On December 15, 2022, the Office of Foreign Assets Control (“OFAC”) added 18 entities in Russia’s financial services sector to the Specially Designated Nationals and Blocked Persons List (“SDN List”). The US State Department concurrently designated Vladimir Potanin, one of the richest men in Russia.
OFAC designated Public Joint Stock Company Rosbank (“Rosbank”), a bank acquired by Potanin earlier this year. In conjunction with the designation, OFAC also issued three new Russia-related General Licenses (“GL”). GL 58 authorizes all ordinarily incident and necessary transactions required to wind down transactions with Rosbank, or any entity which Rosbank owns, directly or indirectly, 50% or more. GL 58 also allows those transactions until March 15, 2023. GL 59 authorizes the divestment or transfer of Rosbank debt or equity instruments to non-US persons, the clearing and settling of trades involving Rosbank securities that were placed prior to Rosbank’s SDN designation and the wind down of certain securities and derivative transactions involving Rosbank, all until March 15, 2023. Finally, OFAC amended GL 8E to add Rosbank to the list of sanctioned Russian banks that are allowed to process certain energy-related transactions under GL8E.
OFAC also designated 17 subsidiaries of VTB Bank Public Stock Joint Company, which OFAC previously designated in February 2022. The subsidiaries designated include:
- Aktsionernoe Obshchestvo SG-Development, a Russia-based entity engaged in real estate activities.
- Embassy Development Limited, a United Kingdom-based entity engaged in financial activities.
- Estate Management Company Limited, a Russia-based entity engaged in real estate activities.
- ITC Consultants Cyprus Limited, a Cyprus-based entity engaged in management consulting services.
- Joint Stock Company Citybike, a Russia-based travel and personal leisure company that rents consumer goods.
- Joint Stock Company VTB Development, a Russia-based entity engaged in business and management consulting services.
- Kordex Joint Stock Company, a Russia-based entity engaged in business and management consultancy activities.
- Limited Liability Company VTB Commercial Finance, a Russia-based financial institution.
- Limited Liability Company VTB Infrastructure Investments, a Russia-based entity engaged in business support service activities.
- Megacom Limited Liability Company, a Russia-based entity engaged in the construction of buildings.
- Obshchestvo S Ogranichennoi Otvetstvennostyu Dolgovoi Tsentr, a Russia-based entity engaged in business support service activities.
- Obshchestvo S Ogranichennoi Otvetstvennostyu Proekt, a Russia-based entity engaged in real estate activities.
- Obshchestvo S Ogranichennoi Otvetstvennostyu VTB Syryevye Tovary Kholding, a Russia-based entity engaged in non-specialized wholesale trade.
- Ryabinovaya OOO, a Russia-based entity engaged in real estate activities.
- VB-Service Company Limited, a Russia-based entity engaged in real estate activities.
- VTB Leasing Joint Stock Company, a Russia-based entity engaged in financial leasing.
- VTB Real Estate Limited Liability Company, a Russia-based entity engaged in real estate activities.
Husch Blackwell’s Export Controls and Economic Sanctions Team continues to closely monitor all sanctions and export controls developments concerning Russia, Belarus, and Ukraine and will provide further updates as conditions change. Interested readers can also review content covering previous Russia, Belarus and Ukraine sanctions developments at the Husch Blackwell Russia Sanctions Resource Library. Should you have any questions or concerns, please contact Cortney Morgan, Grant Leach, Emily Mikes or Eric Dama of our Export Controls and Economic Sanctions Team.