Posted 28/02/2022 by Leah Ferris
On 23 February 2022 the Government first announced new sanctions to be imposed on Russian individuals, organisations and banks in response to Russia’s recent aggression against Ukraine, with further sanctions imposed following Russia’s invasion of Ukraine. This Flagpost discusses existing sanctions which were imposed on Russia in 2014 in response to the Russian Government’s annexation of Crimea and explains how the Government will give effect to the recently announced sanctions (as at 28 February 2022).
Australia’s sanctions laws
Australia implements two types of sanctions: sanctions imposed as a consequence of Australia’s membership of the United Nations (imposed through the Charter of the United Nations Act 1945), and sanctions imposed autonomously by the Australian Government under the Autonomous Sanctions Act 2011 and the Autonomous Sanctions Regulations 2011 (the Regulations).
Autonomous sanctions are punitive measures, imposed by the Government as a foreign policy tool which do not involve the use of armed force. The Department of Foreign Affairs and Trade notes that sanctions can be aimed at bringing a situation of international concern to an end by influencing those responsible, limiting the adverse impacts of a situation, or penalising those responsible.
They can be applied to a foreign government entity, a member of a foreign government entity, or another person or entity outside Australia.
Sanctions measures include:
- restrictions on trade in goods and services
- restrictions on engaging in commercial activities
- targeted financial sanctions (including asset freezes) on designated persons and entities and
- travel bans on certain persons.
Following the passage of the Autonomous Sanctions Amendment (Magnitsky-style and Other Thematic Sanctions) Act 2021 (the 2021 Act), the Government now has the power to impose sanctions to address particular issues (known as thematic sanctions) which include threats to international peace and security; malicious cyber activity; serious violations or serious abuses of human rights; or activities that undermine good governance or the rule of law. While previously sanctions imposed by Australia have been country-focused, these reforms allow the Government to impose sanctions to address a wider range of conduct (for example, human rights abuses), irrespective of where the conduct occurs.
Previous sanctions imposed on Russia
Following Russia’s annexation of the Ukrainian territory of Crimea, then Foreign Minister, Julie Bishop, announced on 19 March 2014 that Australia would impose targeted financial sanctions and travel bans on 12 Russian and Ukrainian individuals. She later announced on 21 May 2014 that these sanctions would be expanded to cover an additional 38 Russian and Ukrainian individuals and 11 entities.
On 12 June 2014, the Government amended the Regulations to allow the Foreign Minister to impose financial and travel sanctions on ‘a person or entity that the Minister is satisfied is responsible for, or complicit in, the threat to the sovereignty and territorial integrity of Ukraine’. The Autonomous Sanctions (Designated Persons and Entities and Declared Persons – Russia and Ukraine) List 2014 (the 2014 List) details the individuals and entities which are currently subject to sanctions.
On 1 September 2014 then Prime Minister Tony Abbott announced that Australia would impose further sanctions on Russia in response to the continuing Russian threat to the sovereignty and territorial integrity of Ukraine. The Government amended the Regulations to prohibit (without prior authorisation from the Foreign Minister):
- the export to Russia of goods and services that are arms and related materiel
- the export to Russia of goods and services for use in oil exploration and production
- the export to Crimea and Sevastopol of goods and services related to infrastructure in the transport, telecommunications, energy, oil, gas, and minerals sectors
- the import from Russia of arms and related material
- the import from Crimea and Sevastopol of any goods that have not been verified by Ukrainian authorities
- commercial dealings that provide certain entities of Russia access to Australian capital markets and
- Australian investment in Crimea and Sevastopol related to infrastructure in the transport, telecommunications, energy, oil, gas, and minerals sectors.
The Autonomous Sanctions (Russia, Crimea and Sevastopol) Specification 2015 provides details on which goods and commercial activities are currently subject to sanctions.
Sanctions imposed in February 2022
All of the recent sanctions announced by the Government will be imposed under the existing country-specific sanctions regime with respect to Russia/Ukraine that was in place prior to the passage of the 2021 Act.
On 24 February 2022 the Government made the Autonomous Sanctions Amendment (Russia) Regulations 2022, which amended the Regulations to broaden the scope of individuals and entities on which Australia can impose targeted financial sanctions and/or travel bans to include:
- a person (or a member of their immediate family) or entity that the Minister is satisfied is, or has been, engaging in an activity or performing a function that is of economic or strategic significance to Russia or
- a current or former Minister or senior official of the Russian Government (or their immediate family members).
The Government has made a number of amendments to the 2014 List to subject individuals and entities to travel bans and financial sanctions:
- On 24 February 2022 the 2014 List was:
- On 25 February 2022 an amendment listed 339 members of the Russian Parliament who voted in favour of recognising the Ukrainian regions of Donetsk and Luhansk as independent republics and eight persons holding senior leadership positions in banks, social media, oil, gas and transport companies, and companies that support the Russian military.
- On 26 February the 2014 List was amended to include key Belarusian individuals and entities who have provided support to Russia.
- On 27 February the 2014 List was amended to include 5 individuals holding senior positions in the Russian Government, including the current President Vladimir Putin and Foreign Minister Sergei Lavrov.
All of these sanctions take effect on the day after the instrument was registered on the Federal Register of Instruments.
On 24 February 2022, the Government also amended the Regulations to extend existing sanctions that apply to Crimea and Sevastopol (outlined above) to the regions of Donetsk and Luhansk. These sanctions will not take effect until 28 March 2022. The Prime Minister has stated that this is required to give ‘opportunities for businesses that have had legitimate operations and business interests in Russia and in the affected territories of Ukraine to be able to make changes to their arrangements’.
While the Prime Minister has acknowledged that the sanctions imposed on trade with Russia are unlikely to have a significant impact given Russia is not a significant trading partner with Australia, he noted that targeting specific individuals and entities will enable the Australian Government to be more effective in ensuring that those who are financing and profiting from Russia’s actions in Ukraine face consequences. However, in the past, Russia has responded to the imposition of sanctions by Western countries through banning imports of certain agricultural products from these countries (the ban with respect to Australia was most recently extended to December 2021).
Whether Russia will extend this ban again, or take other actions against Australia in retaliation for its decision to impose sanctions, remains unknown. While the Prime Minister has previously stated that Australia is taking a staged approach with respect to sanctions, stating ‘we have plenty left in the tank when it comes to further actions we would take if and when the violence is escalated by Russia’, it’s not clear what other options remain.