Implement Executive Order 13662 against
Russian Financial Institutions and Two Energy Firms.
also Target Eight Defense Technology Entities, Three Separatists, One Entity
Complicit in the Misappropriation of Ukrainian State Assets, and Four Russian
– In response to Russia’s continued attempts to destabilize eastern Ukraine and
its ongoing occupation of Crimea, the U.S. Department of the Treasury today
imposed a broad-based package of sanctions on entities in the financial
services, energy, and arms or related materiel sectors of Russia, and on those
undermining Ukraine’s sovereignty or misappropriating Ukrainian property.
imposed sanctions that prohibit U.S. persons from providing new financing
to two major Russian financial institutions (Gazprombank OAO and VEB) and
two Russian energy firms (OAO Novatek and Rosneft), limiting their access
to U.S. capital markets;
designated eight Russian arms firms, which are responsible for the
production of a range of materiel that includes small arms, mortar shells,
designated the “Luhansk People’s Republic” and the “Donetsk People’s
Republic,” which have asserted governmental authority over parts of
Ukraine without the authorization of the Government of Ukraine; and
Aleksandr Borodai, the self-declared “prime minister” of the Donetsk
People’s Republic, for threatening the peace, security, stability,
sovereignty, and territorial integrity of Ukraine;
designated Feodosiya Enterprises, a key shipping facility in the Crimean
peninsula, because it is complicit in the misappropriation of state assets
of Ukraine; and
- Treasury designated four Russian government officials,
including Sergey Beseda, a senior Russian Federal Security Service
actions do more than build upon previous steps to impose costs on separatists
and the Russian government. By imposing sanctions on entities within the
financial services and energy sectors, Treasury has increased the cost of
economic isolation for key Russian firms that value their access to medium- and
long-term U.S. sources of financing. By designating firms in the
arms or related materiel sector, Treasury has cut these firms off from the U.S.
financial system and the U.S. economy.
has continued to destabilize Ukraine and provide support for the separatists,
despite its statements to the contrary,” said Under Secretary for Terrorism and
Financial Intelligence David S. Cohen. “Because Russia has failed to meet
the basic standards of international conduct, we are acting today to open
Russia’s financial services and energy sectors to sanctions and limit the
access of two key Russian banks and two key energy firms to U.S. sources of
financing, and to impose blocking sanctions against eight arms firms and a set
of senior Russian officials.”
of the Financial Services Sector of Russia and the Prohibition of Certain Types
of Activities with Two Russian Banks Pursuant to E.O. 13662
Treasury Secretary Jacob J. Lew determined that persons operating within
Russia’s financial services sector may now be subject to targeted
sanctions. Following Secretary Lew’s determination, Treasury imposed
measures prohibiting U.S. persons and persons within the United States from
transacting in, providing financing for, or otherwise dealing in new debt of
longer than 90 days maturity or new equity for Gazprombank OAO and VEB, their property,
or their interests in property. As a practical matter, this step will
close the medium- and long-term U.S. dollar lending window to these banks, and
will impose additional significant costs on the Russian Government for its
continued activities in Ukraine.
have not blocked the property or interests in property of these banks, nor have
we prohibited transactions with them beyond these specific restrictions.
However, the scope of the prohibited transaction types and the number of
financial institutions may be expanded under E.O. 13662 if we decide to do so.
Gazprombank OAO is a Russian
financial institution, which was originally established to provide financial
services to companies in Russia’s energy industry, but has expanded to provide
services to more than 45,000 companies and 3 million private individuals.
Gazprombank OAO has more than 40 branches across Russia, and a number of
international subsidiaries. Gazprombank OAO specializes in the private
banking and corporate financing services.
VEB is a Russian
state-owned financial institution that acts as a development bank and payment
agent for the Russian government. It was formed June 8, 2007, pursuant to
Russian federal law and is the legal successor to Vnesheconombank of the USSR,
which was a specialized Russian state bank. VEB’s supervisory board is
chaired by the Russian prime minister, and the chairman of the bank is
appointed by the Russian president. VEB acts as an agent for the Russian
Government for the purposes of accounting, servicing, and repaying the
sovereign debts of the former USSR and Russia; accounting, servicing, and
repaying government loans issued by the former USSR and Russia to foreign
borrowers; collecting debts from legal entities of Russia and municipal governments;
providing and executing state guarantees of Russia and monitoring projects
implemented by Russia with involvement of international financial institutions.
Identification of the Energy Sector
of Russia and the Prohibition of Certain Types of Activities with Two Russian
Energy Firms Pursuant to E.O. 13662
Secretary Lew determined that persons operating within Russia’s energy sector
may now be subject to targeted sanctions. Following Secretary Lew’s
determination, Treasury imposed measures that prohibit U.S. persons and persons
within the United States from transacting in, providing financing for, or
otherwise dealing in new debt of longer than 90 days maturity for Russian
energy firms OAO Novatek and Rosneft, their property, or their interests in
property. As with the financial institutions, we have not blocked the
property or interests in property of these companies, nor prohibited
transactions with them beyond these specific restrictions. However, the
scope of the prohibited transaction types and the number of energy companies
may be expanded under the authorities of E.O. 13662, if the Russian government
does not take steps to de-escalate the situation in Ukraine.
OAO Novatek is Russia’s
largest independent natural gas producer.
Rosneft is Russia’s
largest petroleum company and third largest gas producer. Treasury
designated Rosneft’s President and Chairman of the Board, Igor Sechin, on April
28, 2014, pursuant to E.O. 13661.
Imposition of Sanctions on Eight
Firms Pursuant to E.O. 13661 for Operating in the Arms or Related Materiel
Sector in the Russian Federation
today has also designated and blocked the assets of Almaz-Antey, Federal State
Unitary Enterprise State Research and Production Enterprise Bazalt, JSC Concern
Sozvezdie, JSC MIC NPO Mashinostroyenia, Kalashnikov Concern, KBP Instrument
Design Bureau, Radio-Electronic Technologies, and Uralvagonzavod pursuant to
E.O. 13661 for operating in the arms or related materiel sector in the Russian
Federation. The designated firms are responsible for the production of a
range of materiel, from small arms to mortar shells to tanks. As a
result of today’s action under E.O. 13661, any assets of the entities designated
that are within U.S. jurisdiction must be frozen. In addition,
transactions by U.S. persons or within the United States involving the entities
designated today under E.O. 13661 are generally prohibited.
surface-to-air missile systems currently used by the Russian military.
Federal State Unitary Enterprise
State Research and Production Enterprise Bazalt (“Bazalt”) is
involved in the design and construction of air launched ordnance, rocket
propelled grenades, and armored fighting vehicle ammunition. Bazalt’s
manufacturing interests include aerial bombs, mortar shells, grenades,
anti-tank and anti-saboteur grenade launchers, and projectiles of all types and
JSC Concern Sozvezdie develops and
produces high-tech control and communication systems, radio electronic warfare
and special equipment for military forces. JSC Concern Sozvezdie focuses
on three primary lines of production: military-oriented production,
dual-purpose products, and dual-purpose products and professional communication
and control systems. JSC Concern Sozvezdie’s main activities include
producing and developing materiel including automated control systems and
communication systems for the tactical sector, automated control systems and
communication systems for anti-missile defense and air defense systems,
and automated communication systems and electronic warfare tools. The
company produces systems and devices related to electronic warfare, such as small
manpack and portable jammers. The products are designed to disrupt enemy
army operations, to reduce staff and equipment loss, and to improve the
operation of armed forces by radio jamming of enemy weapon control systems
based on radio frequencies.
JSC MIC NPO Mashinostroyenia is a leading
Russian rocketry company responsible for defense programs involving cruise
missile complexes capable of surface, underwater, and ground platform-based
launches. JSC MIC NPO Mashinostroyenia’s involvement in Russia’s
strategic nuclear forces includes the manufacture of intercontinental ballistic
rockets and the development of space systems, spacecraft, and automatic and
manned orbital stations in support of Russia’s Ministry of Defense.
produces a number of military weapons, including multiple grades and versions
of assault rifles, grenade launchers, sniper rifles, military shotguns, and
aircraft cannons. Kalashnikov Concern is the largest firearms producer in
Russia and is a subsidiary of Russia’s State Corporation of Russian
KBP Instrument Design Bureau is a research
and production center that creates precision-guided weapons. KBP
Instrument Design Bureau develops antitank missile systems and assault
armaments, weapon systems for main battle tanks and lightly armored vehicles,
guided artillery projectiles and guided missile systems, short-range air
defense systems, gun armament and associated ammunition, combat small arms, and
Radio-Electronic Technologies designs and
produces electronic warfare equipment including weapons-control systems,
friend-or-foe identification (IFF) systems, avionics, operational and tactical
systems, electronic warfare and intelligence equipment, special measuring
instrumentation, and plugs, electric connectors, and cable products.
Uralvagonzavod is a Russian
government-owned company that builds a variety of military equipment, including
Sanctions on Two Entities and One Individual Pursuant to E.O. 13660
following two entities and one individual are being designated and blocked
today pursuant to E.O. 13660 for threatening the peace, security, stability,
sovereignty, or territorial integrity of Ukraine.
Treasury Department has determined that the Luhansk People’s Republic
(LPR) has asserted governmental authority over a part or region of Ukraine
without the authorization of the Government of Ukraine. The self-proclaimed LPR
has asserted governmental authority through a number of actions, including
issuing a declaration of martial law; banning the sale of corporate rights,
production facilities, companies, and other assets; controlling the border
guard checkpoints of Izvarino, Dolzhanskoye, and Krasnyi Partizansk on the
Ukrainian-Russian border; and, shooting down a Ukrainian military transport jet
as it attempted to land in Luhansk. The LPR also elected a leader and passed
its own constitution on May 11, 2014.
Treasury Department has also determined the Donetsk People’s Republic to
have asserted governmental authority over a part or region of Ukraine without
the authorization of the Government of Ukraine. The militia in the
self-proclaimed Donetsk People’s Republic is defying the peaceful settlement
regime, continues combat operations, and has seized and occupies regional
government buildings, using them as its headquarters and firing
positions. Igor Strelkov, the leader of the militia of the Donetsk
People’s Republic, rejected Ukrainian President Petro Poroshenko’s peace plan.
Aleksandr Borodai is the
self-declared “prime minister” of the “Donetsk People’s Republic” in Ukraine
and has vowed to expel Ukraine’s army from his new domain and resist any bid to
recapture the city. Borodai was in Crimea as an advisor to Sergei
Aksyonov, the separatist prime minister who oversaw the territory’s purported
annexation by Russia. Treasury designated Aksyonov pursuant to E.O. 13660
on March 17, 2014.
Imposition of Sanctions on Crimean
Entity Pursuant to E.O. 13660
following Crimea-based entity is being designated pursuant
to E.O. 13660 for being complicit in the misappropriation of state assets of
Feodosiya Enterprise operates a key shipping facility in the
Crimean peninsula for oil imports and exports. Prior to Russia’s purported
annexation of Crimea, Feodosiya Enterprise had
been controlled by the Ukrainian state-controlled gas company Naftogaz.
On March 25, 2014, the separatist self-styled “Crimean Parliament” nationalized
Feodosiya Enterprise and
decreed that the self-styled “Crimean Ministry of Fuel and Energy” would be the
governing body of Feodosiya Enterprise.
The separatist “Minister of Fuel and Energy” asserting authority in
occupied Crimea has confirmed that, as of April 15, 2014, separatist
authorities in Crimea were provided with fuel by Russian oil companies using
the storage facility operated by Feodosiya
Imposition of Sanctions on Four
Individuals Pursuant to E.O. 13661
following four individuals are being designated today pursuant to E.O. 13661
for their status as Russian government officials.
Sergey Besesda heads Russia’s
Federal Security Service (FSB)’s Fifth Service, also known as the Service for
Operational Information and International Communications.
Oleg Savelyev is Russia’s
Minister for Crimean Affairs. In this capacity, Savelyev is responsible for the
integration of occupied Crimea into the Russian Federation following Russia’s
purported annexation of Crimea from Ukraine.
Sergei Neverov is the Deputy
Chairman of the State Duma of the Russian Federation. Neverov is responsible
for initiating legislation to integrate the purportedly annexed Ukrainian
region of Crimea into the Russian Federation.
Igor Shchegolev is an Aide to
the President of the Russian Federation.
a result of today’s actions under E.O. 13660 and E.O. 13661, any assets of the
entities or individuals designated that are within U.S. jurisdiction must be
frozen. Additionally, transactions by U.S. persons or within the United
States involving the entities or individuals designated today under E.O. 13660
or E.O. 13661 are generally prohibited.
identifying information on the individuals and entities named in this release,
please click here.