Brussels Demands EU Members Urgently Stop Illegal Flow of Goods to Russia

Brussels is calling on the governments of EU member states to urgently halt the illegal flow of goods to Russia. In a letter sent to capitals, the European Commission warned of the need for "immediate, coordinated, and decisive action from all of us." This was reported by MyUkraineIs with reference to Politico.

As patience with violators is running thin, EU Finance Commissioner Mairead McGuinness and EU Trade Commissioner Valdis Dombrovskis, who signed the letter, stated that they would soon share "detailed information" about which companies are circumventing sanctions. They announced that they would contact capitals by mid-April to assess the measures taken.

While sanctions are agreed upon at the EU level, compliance is the responsibility of governments, which are monitored by the European Commission. In December, countries approved a new package of restrictions against Russia and are working on the next one.

Sanctioned goods from the EU are delivered to Russia initially through non-EU countries and then re-exported to Russia, as well as through subsidiaries of European companies producing goods outside the bloc, according to the letter. Typically, these are items and technologies that are not weapons but can be used for military purposes and end up on the battlefield.

Centralization of Control The European Commission is exploring the possibility of creating an EU body for sanction enforcement, effectively taking over this task from governments.

According to an official close to the negotiations who spoke on condition of anonymity, this idea is gaining popularity and may be on the agenda of European Commission President Ursula von der Leyen if she is appointed for a second term.

The letter states that exports of banned goods from the EU to non-EU countries increased from €3 billion before the invasion of Ukraine to €5.6 billion by mid-2023. This "extremely alarming" increase compensates for the loss of legal trade in these goods with Russia before the war, the message said.

The letter instructs governments to "hold EU operators accountable for actively undermining EU sanctions" and prevent companies from exploiting loopholes in the sanctions, publishing the "most illustrative" cases and associated penalties.

McGuinness also advises member countries to contact companies involved in the production of sanctioned goods and force them to conduct a more thorough check of their supply chains for compliance with EU sanction rules.

National authorities should share additional information about non-EU companies and individuals who may be involved in exploiting sanction loopholes and must "exercise particular vigilance" regarding exemptions from sanctions that could exacerbate the problem, the letter states.

Huge Challenges The idea of creating a European body for sanction enforcement has been popular in the past: about 10 countries, including Germany, France, Italy, and Spain, supported the idea of creating such a body under Dutch leadership.

Last year, France lobbied for the expansion of the powers of the European Public Prosecutor's Office to cover sanction loopholes.

A senior EU diplomat said there are "huge problems" with implementing sanctions, including their "uneven" distribution from one country to another.

Another EU diplomat stated they support any tool that helps EU countries ensure compliance with sanctions.

A third cautioned against creating an EU-level body, arguing that the European Commission would encroach on the influence of national governments, replacing their authority. Any EU sanctions body should only monitor work at the national level and provide recommendations, said this person.

"We do not think member states will relinquish this competency," they added, suggesting that such a move could have "consequences in other areas."

McGuinness will discuss the letter with national ministers at a sanctions meeting on February 13.

The European Union has started discussions on a new package of sanctions, which it intends to approve by February 24, 2024.

The Ukrainian side, in turn, has called on the EU to focus sanctions on preventing high-tech Western components from falling into the hands of the Russian army.

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