Ukraine imposes sanctions against all banking and financial institutions of Russia

On Wednesday, 22 February, President Volodymyr Zelenskyy submitted to the Verkhovna Rada [Ukraine’s parliament – ed.] a resolution approving the National Security and Defence Council of Ukraine's decision to apply sectoral economic sanctions against Russian financial institutions.

Source: The text of the document was published on the Verkhovna Rada's website.

The National Security and Defence Council of Ukraine decided to apply special sectoral economic sanctions for a period of 50 years to all banks registered and located in the Russian Federation, including:

• the Central Bank of Russia;
• non-bank credit organisations;
• operators of payment systems;
• professional stock market participants;
• insurance companies;
• investment funds;
• other financial institutions that are registered and provide services in Russia.

They include 10 points – in particular, the suspension of transactions with assets belonging to Russian financial institutions; the prohibition of establishing business relations, including correspondence; prohibition of concluding agreements and making investments in favour of financial institutions of the Russian Federation.

The purchase of securities and other financial instruments issued by Russian financial institutions is also prohibited, except for alienation (including free of charge) of securities in favour of the state of Ukraine.

The sanctions also provide for the suspension of economic and financial obligations in favour of the financial institutions of the Russian Federation, and the suspension of service of electronic means of payment (transfers, making calculations, and issuing cash) issued by these financial institutions.

The decree also provides for the cancellation of registration and prohibition of new registrations  of the international payment system by the National Bank, as long as these registrations come from a financial institution of the Russian Federation, and its participants. It also concerns a participant of the financial institution of the Russian Federation in the international payment system, the operator of which is a resident of Ukraine.

It is also forbidden for individuals and legal entities to take actions that lead to the violation and avoidance of the imposed restrictions.

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