(as of March 15, 2022)
1. Sanctions Against Russia
On February 24, 2022, the Korean government promptly expressed its intention to join the efforts of the international community for peaceful resolution of the situation in Ukraine by implementing new sanctions and export controls against Russia. Ever since, the Korean government has introduced a series of financial sanctions against Russia. So far, Korea’s sanctions against Russia can be summarized as follows:
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Suspension of financial transactions with 11 Russian entities and their subsidiaries
- Sberbank, VEB, PSB, VTB, Otkritie, Sovcom, Novikom, and their subsidiaries (subject to the same grace periods and exceptions recognized under relevant general licenses in the US)
- The Central Bank of the Russian Federation (“CBR”), the National Wealth Fund of the Russian Federation (“NWF”), the Russian Direct Investment Fund (“RDIF”), and Bank Rossiya (effective from March 8) -
Suspension of trading in the primary or secondary market of Russian government bonds newly issued on or after March 2
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Exclusion of seven Russian banks (Bank Rossiya, VEB, PSB, VTB, Otkritie, Sovcom, and Novikom) from the SWIFT system, effective from 8 a.m. on March 13 (KT)
Recently, a Korean news article mentioned that the Korean government has unofficially decided not to join energy sanctions imposed by the US and other allies (e.g., import ban on Russian oil and liquefied natural gas), but the government has not announced its official position yet.
2. Export Controls on Russia
On February 28, 2022, the Korean government decided to take export control measures against Russia that are substantially similar to those imposed by the international community and the US. On March 6, the Korean government announced similar export control measures on Belarus, which Korea found effectively supported the Russia invasion of Ukraine. So far, the government has implemented or plans to implement the following export control measures:
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(Tightened review of items subject to multilateral export controls) Ban on export of strategic items to Russia and Belarus, in view of “maintenance of international peace and security” and “military and diplomatic sensitivity of importing countries” (effective from February 28 and March 7, respectively)
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(Addition to the list of Parties of Concern) Designation of 49 Russian entities and 2 Belarusian entities that were newly added to the US Entity List as Parties of Concern (effective from March 4 and March 7, respectively)
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(Export controls on certain non-strategic goods) The government encouraged companies to voluntarily apply for situational licenses (i.e., licenses under catch-all controls) for 57 Export Control Classification Numbers (“ECCNs”) subject to the US export controls against Russia announced on February 24 and is preparing for amendment of relevant laws for export control of those non-strategic items, utilizing the situational license system.
Meanwhile, the Ministry of Trade, Industry, and Energy (the “MOTIE”) and the US Department of Commerce announced via a joint statement on March 7 that as Korea officially joined the international cooperation against the Russian invasion of Ukraine, Korea was added to a list of exempted countries from the new Russia/Belarus-specific Foreign Direct Product Rules (“FDPR”), one of the new export control measures of the US.
- Please note that although Korea is exempted from the new Russia/Belarus FDPR and Russia/Belarus-Military End User (“MEU”) FDPR, other US export control measures are still applied.
The Korean government is yet to announce the amendment of relevant laws and regulations to adopt the export controls implemented by the international community and the US.
