On 23 July 2026, the Council of the European Union (the “Council”) adopted its 21^st sanctions package against Russia. The package aims to put additional pressure on the Russian economy in response to Russia’s aggression against Ukraine, in particular the recent brutal military strikes deliberately targeting civilian infrastructure, including energy, water and health facilities, cultural and religious sites, and causing severe hardship for the civilian population.

With each round of sanctions, we squeeze Russia’s economy and its capacity to prolong its illegal war. Our 21st package includes the highest number of listings in four years. [...] Russia will only negotiate to end its illegal war and stop killing civilians if it is pressured to do so. Sanctions add to this pressure. - Kaja Kallas, High Representative for Foreign Affairs and Security Policy and chair of the Foreign Affairs Council

This Insight discusses the sanctions adopted against Russia and mirroring sanctions against Belarus. These sanctions were adopted through 3 Common Foreign and Security Policy (“CFSP”) Decisions, 3 Council Regulations, and 2 Council Implementing Regulations. Separately, on 13 July 2026, the Council has adopted, 10 days prior to the 21^st package, sanctions against four Russian entities and nine individuals involved in cyber-attacks targeting the EU and its Member States, listing them under the regimes addressing Russia’s destabilising activities and cyberattacks threatening the EU.

Key Takeaways

• Largest designation round since February 2022: 48 individuals and 170 entities added, dominated by 94 banks/financial institutions and 56 listings targeting the military-industrial complex (including 37 in the drone supply chain).
• 33 additional Russian banks and 17 non-EU financial/crypto entities added to transaction-ban annexes, with limited wind-down derogations for account closure available only within a 3-month window.
• New transaction bans target oil refineries and traders: including Kulevi Oil Refinery in Georgia (effective 25 January 2027) and five oil traders, alongside a new derogation permitting NCAs to authorise the import, purchase, or transfer of Russian oil cargos seized or confiscated by Member State authorities (opening a route to state seizure and resale of Russian crude) and a temporary suspension of the oil price cap's automatic adjustment mechanism through 14 July 2027.
• Transport infrastructure restrictions expand: new LNG tanker ownership-transfer notification obligations (with a possible future sale ban), extension of the port/lock and airport transaction ban to two additional Russian ports/locks (Olya and Vysotsk) and four Russian airports (Sheremetyevo, Ulyanovsk-Vostochny, Rostov-on-Don Platov, and Mineralnye Vody), and a new exemption preserving JSC Russian Railways' funds and economic resources where necessary for rail transport between Russia and the EU, in transit through the EU, or between Kaliningrad and mainland Russia.
• Crypto sector faces new structural restrictions: a framework transaction ban targeting non-cooperative third-country crypto platforms (Annex LVII, currently empty but expected to be populated) and an extension of the Russian/Belarusian ownership-and-governance ban to virtually all crypto-asset services as of 25 August 2026.
• New tools strengthen legal protection for EU operators: expanded rights to recover damages before EU courts for third-country claims affecting sanctioned transactions, and new mechanisms allowing EU courts to refuse recognition of, and block enforcement of, Russian court judgments issued under the Russian Arbitration Procedure Code.

Individual Restrictive Measures

New designations – On 23 July 2026, the Council added 48 individuals and 170 entities to its restricted parties list through Council Regulation 2026/1843 and Council Regulation 2026/1817. These listings comprise the largest single designation round action since February 2022 and notably include:

• 94 banks and major financial institutions, as well as a prominent figure in Russia's banking establishment;
• Four persons and entities linked to the A7 cross-border financial and cryptocurrency network;
• 56 listings targeting the Russian military-industrial complex, including 37 entities directly involved in the production and supply chain of long-range drones;
• Eight entities and one individual supporting Russia's shadow fleet;
• 18 entities and one individual active in the oil sector, including three Russian refineries and a major Belarusian oil refinery, OJSC Mozyr Oil Refinery;
• Seven major actors in the gold sector, a leading diamond company, and several entities operating in the mining and metallurgy sectors;
• Individuals involved in Russian war propaganda and disinformation.

New insurance-related derogation for certain designated entities – The national competent authorities (“NCAs”) can now authorise payments due by the persons listed under Article 3(1)(k) of Regulation 269/2014 or by an insurance provider, provided that such payments:

• Are to be made to non-designated entities established in the EU, a member country of the European Economic Area (“EEA”), Switzerland or partner countries (Annex VIII of Regulation 833/2014) or to nationals or residents of those jurisdictions; and
• Constitute an indemnity or insurance benefit resulting from the materialisation of a covered risk for which those designated persons are liable.

New derogations specific to Petr Olegovich Aven and Mikhail Maratovich Fridman – NCAs may now authorise:

• The transfer of equity instruments by EU banks to EU entities that are, prior to such transfer, minority-owned by Mr. Aven or Fridman, provided (i) that such transfer is carried out on the basis of a put option right agreed and exercised prior to 28 February 2022 and (ii) that any shares or participations of those individuals are frozen; and
• The release of frozen funds or economic resources or the making available of certain funds or economic resources of Mr. Aven or Fridman, including those held in Alfa-Bank JSC and AlfaStrakhovanie Group, and of any entity they own or control provided that:
• This transaction is carried out for the sole purpose of satisfying the payment obligation owed to an EU credit institution established pursuant to a put option right agreed and exercised prior to 28 February 2022; and
• The funds and economic resources are transferred directly to the non-listed EU bank.

New exemption specific for JSC Russian Railways – The asset-freeze restrictions do not apply to funds and economic resources of JSC Russian Railways necessary for the transport of goods and passengers by rail between Russia and the EU, in transit through the EU, between the Kaliningrad Oblast and mainland Russia, or within Russia or to those necessary for the operation, maintenance and security of such railway activities. Although JSC Russian Railways is not expressly listed under Regulation 269/2014, its Director General and Chairman of the Executive Board, Oleg Valentinovich Belozerov, was designated as part of the 21^st sanctions package.

New exemption specific for the Paks II nuclear project – The asset-freeze restrictions do not apply to the funds or economic resources of three newly designated entities (UK UZTM KARTEX LLC, Uralmashplant JSC and G. Korobkov IZ-KARTEX LLC) or to the making available of funds or economic resources available to them provided that they are necessary with regard to the Paks II nuclear power plant project.

• Notification Obligation: Entities relying on this exemption must notify the Hungarian NCA within two weeks of reliance on the exemption.

Sectoral Sanctions

Energy Sector

Crude Oil and Petroleum Products

• Temporary suspension of the automatic adjustment of the oil price cap mechanism – To limit Russia’s profits despite the exceptional situation caused by the closure of the Strait of Hormuz, the EU suspended the automatic adjustment of the oil price cap mechanism through 14 July 2027 (unless specifically amended because of exceptional developments).

New derogations from the restrictions on crude oil and petroleum products

• Derogation for Russian oil cargos seized or confiscated by Member States – NCAs may now authorise, under certain conditions, the import, purchase, transfer, temporary storage and/or placement (as the case may be) under the free-zone procedure in the EU of Russian crude oil or petroleum products (listed in Annex XXV of Regulation 833/2014) that have been seized or confiscated by an authority of a Member State in the course of national administrative or judicial proceedings provided such products remain under the effective control of such authorities or an entity acting on behalf of such authorities.
• Derogation for the supply of petroleum products to certain outermost regions and overseas countries and territories – NCAs may now authorise importers not to provide evidence of the country of origin of the crude oil used for the refining of petroleum products in a third country provided that:
• Such products are intended to supply the outermost regions and overseas countries and territories associated with the EU;
• Due to the specific constraints, there is a proven risk of a disruption or serious disturbance to the supply of petroleum products; and
• No alternative source is available to ensure the continuity of supply under economically and logistically viable conditions.
• New transaction ban targeting certain refineries (Part D of Annex XLVII) – As of 25 January 2027 (subject to the conclusions of the Commission’s report to the Council by 25 October 2026), it is prohibited to engage in any transaction with the listed refineries (as of this date, only Kulevi Oil Refinery in Georgia).
• Additional oil traders subject to the transaction ban (Part C of Annex XLV) – As of 13 August 2026, it is prohibited to engage in any transaction with five oil traders ((i) Vistula Delta Global FZE, (ii) Estrella Integrated FZE, (iii) Linglong Trading Group FZE, (iv) Arcadia International FZE, and (v) Nexus Oil Trading FZCO), listed for frustrating crude oil and petroleum products and related services prohibitions.

LNG

Restrictions on the sale of LNG tankers (falling under CN code ex 8901 20)

• New notification obligation for transfer of ownership of LNG tankers – EU operators are now required to notify immediately their NCA of any transfer of ownership to any third country of LNG tankers.
• Possible introduction of new restrictions on the sale of LNG tankers – Based on the information received through these notifications, the Council shall review by 25 October 2026 whether and when a new prohibition on the sale of these tankers to individuals or entities in Russia or for use in Russia should enter into force. Once this prohibition enters into force, EU operators transferring ownership of these tankers to any third country will be required to:
• Identify and assess the risk of their diversion to Russia and take appropriate measures to mitigate this risk;
• Contractually prohibit any resale or transfer of these tankers to any individual or entity in Russia or for use in this country and notably require third-country acquirers to replicate this prohibition in any further resale or transfer.

The recital 20 of Regulation 2026/1848 clarifies that EU sellers of LNG tankers should not be liable for a buyer’s subsequent breach of the end-use commitments, provided that (i) they acted in good faith and (ii) had no information suggesting an intent to circumvent these restrictions.

• New temporary exemption for the transport of Russian LNG (falling under CN code 2711 11 00) specific to the Sakhalin-2 Project – The transport by vessel to Japan and to the Republic of Korea of LNG originating in the Sakhalin-2 Project or the provision of related technical assistance, brokering services, financing or financial assistance is now allowed until 31 March 2028.
• New temporary wind-down exemption for transfers of Russian LNG (falling under CN code 2711 11 00) destined for third countries and related purchases – The transfers and related purchases of Russian LNG destined for third countries are allowed until 25 July 2027 (reviewed yearly by the Council), provided they are carried out under contracts concluded before 24 February 2022, with a duration exceeding one year and no amendments made after that date (subject to limited permitted amendments).
• Such exemption only applies in a given year up to the yearly volume of LNG originating in or exported from Russia in 2025 and transferred by an EU operator under the contracts specified above.
• Reporting Obligation – EU operators must report historic volumes to their NCAs before 25 August 2026 and certain information for each shipment from this date and every three months.
• Extension of the prohibition to provide LNG terminal services – The prohibition to provide LNG terminal services has been extended to all entities which are more than 50% owned or controlled by a Russian individual or entity (previously only EU entities).

Vessels contributing to Russia’s energy revenues (Annex XLII)

• New designation criteria – The Council can now list vessels (i) providing bunkering and tug services to other listed vessels and (ii) carrying out ship-to-ship transfers with these vessels.
• New vessels listed – Additional 41 vessels are subject to a port access ban and a ban on the provision of a range of services, bringing the total number of the vessels subject to these bans to 673.

Export/Import-Related Restrictions

Export ban on dual-use (Annex I of Regulation 2021/821) and advanced technology items (Annex VII of Regulation 833/2014 and Annex Va of Regulation 765/2006)

• New advanced technology items listed (Annex VII of Regulation 833/2014 and Annex Va of Regulation 765/2006) – The prohibition on the export of advanced goods and technology has been further strengthened to cover additional items (e.g., nickel powders and metal, alloys of nickel, beryllium powders, self-adhesive films, tapes and strips, aviation items specific to unmanned aerial vehicles) (see the complete list below).
• New entities subject to enhanced restrictions in relation to dual-use and advanced technology items – The Council added:
• 51 new entities to Annex IV of Regulation 833/2014, some of which are located in third countries (China, including Hong Kong, India, Kazakhstan, Kyrgyzstan, Türkiye, and the United Arab Emirates);
• Four new entities to Annex V of Regulation 765/2006.

Import ban on goods generating significant revenues for Russia (Annex XXI of Regulation 833/2014) and those allowing Belarus to diversify its sources of revenue (Annex XXVII of Regulation 765/2006)

• Delisting of tanned sable – The entry for CN code 4302 was amended to exclude tanned sable.
• New listed items – 25 additional items (e.g., copper ores, nickel ores, lead ores, precious-metals ores, unwrought zinc, alkaline-earth metals, certain inorganic chemicals) are now subject to import-related restrictions (see the complete list below).
• Wind-down exemption allowing the execution until 25 October 2026 of contracts concluded before 24 July 2026 for the newly listed goods. Under Belarus sanctions regulation, this exemption applies only to certain goods.
• Extension of the Hungary-specific temporary exemption – The temporary exemption allowing the import to Hungary of acyclic hydrocarbons (falling under CN code 2901 10 00) was extended until 31 December 2026 (previously until 25 July 2026).

Export ban on goods which could contribute to the enhancement of Russian industrial capacities (Annex XXIII of Regulation 833/2014)

• Extension of the derogation for personal household use – This derogation has been extended to household and commercial fans falling under CN code 8414 51.
• Extension of the derogations for the export intended for civil electronic communications network – The derogations allowing the export of certain controlled items which was previously limited to civilian non-publicly available electronic communications networks was now extended to all civilian electronic communications networks. An identical amendment was introduced under the Belarus sanctions regulation.

Financial Sector

Crypto-Assets

• New transaction ban targeting certain crypto-asset services providers and platforms – It is now prohibited to engage in any transaction with crypto-asset entities and platforms established in a third country listed in Annex LVII (currently empty), which should include third countries identified by the Council as having systematically and persistently failed to prevent the provision of crypto-asset services, or to prevent platforms exchanging or transferring crypto-assets, in frustration of the provisions of this Regulation or of Regulation 269/2014.
• Exemption – This ban does not apply to transactions made by EU nationals who are and were residents of a country listed in Annex LVII before the relevant date indicated in that Annex.
• Extension of the prohibition to allow Russian / Belarusian individuals to own, control or hold posts in EU crypto companies – As from 25 August 2026, it is prohibited to allow Russian / Belarusian nationals and residents to own, control or hold posts in the governing bodies of EU entities providing “any other crypto-asset services” as defined in Regulation 2023/1114.
• These services include: (i) providing custody and administration of crypto-assets on behalf of clients; (ii) operation of a trading platform for crypto-assets; (iii) exchange of crypto-assets for funds; (iv) exchange of crypto-assets for other crypto-assets; (v) execution of orders for crypto-assets on behalf of clients; (vi) placing of crypto-assets; (vii) reception and transmission of orders for crypto-assets on behalf of clients; (viii) providing advice on crypto-assets; (ix) providing portfolio management on crypto-assets; (x) providing transfer services for crypto-assets on behalf of clients.

Transaction Ban on Banks (Annexes XIV, XLIV and XLV of Regulation 833/2014)

• New banks subject to transaction bans as of 13 or 23 August 2026 –
• 33 new Russian banks have been included in Annex XIV;
• One Kyrgyz credit and financial institution has been included in Annex XLIV (Yelo Bank (Azerbaijan) has been delisted);
• 17 non-EU credit and financial institutions providing crypto-assets services or payments services have been included in Annex XLV.
• New specific derogation for CJSC Alfa-Bank (Belarus) – NCA are now allowed to authorise transactions with CJSC Alfa-Bank (Belarus) that are necessary for the payment of a consideration due to an EU bank carried out on the basis of a put option right contractually agreed and executed before 28 February 2022.
• New derogation for the withdrawal of funds or the closing of accounts held at certain banks subject to transaction bans (Annexes XLIV and XLV) – NCAs are now allowed to authorise transactions necessary for the withdrawal of funds or the closing of account owned or held by citizens or residents of the EU, the EEA or Switzerland held at banks which were subject to the transaction ban on or after 24 July 2026, provided that:
• Such transactions are necessary to terminate operations, contracts or other agreements concluded with these banks;
• The authorisation is requested no later than 3 months after the date of the entry into force of the transaction ban;
• The funds are transferred to an EU bank or EU-owned or controlled bank.
• Extension of the exemption from the prohibition to sell certain transferable securities to Belarusian nationals and residents to cover EEA and Swiss nationals and residents (previously only nationals and residents of the Member States).

Other

• New derogation from the prohibition to accept donations, economic benefits or support from the Government of Russia of Russian public entities – NCAs can now authorise the acceptance of donations, economic benefits or support by (i) the European X-Ray Free-Electron Laser Facility (EuXFEL), (ii) the Facility for Antiproton and Ion Research in Europe (FAIR) and (iii) the European Synchrotron Radiation Facility (ESRF), if based on international agreements with the Government of Russia.
• Extension of the validity for temporary exemptions and derogations for the wind-down of activities and the divestment from Russia – The Council has extended to 31 December 2027 (instead of previously 31 December 2026) the temporary exemption and derogations from (i) the ban on transaction with entities listed in Annex XIX of Regulation 833/2014, (ii) the prohibition to satisfy claims, (iii) certain transactions involving items subject to import-/export-related restrictions and (iv) the services ban that are necessary the divestment from Russia, the wind-down of business activities in Russia or the divestment from certain joint ventures.
• Additional ports and locks subject to the transaction ban (Annex XLVII of Regulation 833/2014) – The transaction ban has been extended to two additional Russian ports and locks (Olya and Vysotsk) and four airports in Russia (Sheremetyevo Airport, Ulyanovsk-Vostochny Airport, Rostov-on-Don Platov Airport and Mineralnye Vody Airport).
• New exemption from the services ban on tourism activities in Russia – This exemption applies to the provision of a computerised reservation system as defined in Regulation 80/2009.

Legal Protection for EU Operators

• Extension of the possibility to recover damages before EU courts – EU operators are now also entitled to recover, in judicial proceedings before EU courts, any damages incurred as a consequence of claims lodged with courts in third countries in connection with any transaction the performance of which has been affected by Regulation 833/2014, Regulation 269/2014 or Regulation 765/2006 by any individual or entity third country (other than Russia, Belarus and partner countries listed in Annex VIII of Regulation 833/2014 and Vba of Regulation 765/2006):
• Providing goods, technology and services prohibited under Regulation 833/2014 or Regulation 765/2006 to (i) entities listed in any of the Annexes to these regulations (and entities owned by them for Regulation 833/2014), (ii) any other Russian/Belarus individual or entity or (iii) any individual or entity acting through them or on their behalf; or
• Making available funds or economic resources to the persons designated under Regulation 269/2014 or those acting through them or on their behalf.
  
  
• New protection against litigation initiated before Russian courts – EU courts and the Member States are now allowed:
  
  
• Not to recognise any court or administrative decision pursuant to Article 248.1 or Article 248.2 of the Russian Arbitration Procedure Code or equivalent Russian legislation or given by a Russian court or authority, holding EU operators liable, whether in contract or in tort or on any other legal basis, or giving effect to any claim, right or alleged obligation against such person, in connection with any contract or transaction the performance of which has been affected by Regulation 833/2014 or Regulation 269/2014;
• To issue court orders ordering to not seek to enforce, recognise, or rely upon any injunction, order, relief, judgment or other court decision, in any jurisdiction, that was or might be obtained in legal proceedings initiated before a Russian court pursuant to Article 248.1 or Article 248.2 of the Russian Arbitration Procedure Code or equivalent Russian legislation.

Looking Ahead

With the 21st package, the EU maintains momentum in its sanctions strategy addressing Russia's war of aggression against Ukraine and its enablers in third countries. EU sanctions continue to expand beyond direct responses to military aggression to address circumvention, evasion, and hybrid threats more broadly. EU operators should continue to monitor these developments closely and perform adequate risk-based due diligence, particularly where their counterparties, supply chains, or contractual counterparts touch jurisdictions increasingly exposed to secondary designation risk.

The package's new measures on litigation and judgment recognition, which extend EU operators' ability to recover damages before EU courts and shield them from adverse Russian court decisions, further underscore the growing risk of conflict between EU sanctions and third-country legal and regulatory responses.

On 24 July 2026, China's Ministry of Commerce adopted counter export-control measures in direct response to the inclusion of Chinese and Hong Kong entities on the EU's 21st package sanctions list, adding 14 EU entities — including Italian, German, Dutch, French, Polish, Czech, Bulgarian, and Lithuanian companies in the defence and maritime sectors — to its own export-control list. Chinese exporters are now barred from supplying dual-use items to these entities, overseas organisations and individuals may not transfer or provide them with PRC-origin dual-use items, and any ongoing transactions involving them must cease immediately. Separately, in a representative case published by the Supreme People's Court on 24 June 2026, China's Anti-Foreign Sanctions Law was applied in a judicial decision for the first time, with the court holding that unilateral foreign sanctions against a Chinese person cannot justify non-performance of contractual obligations.

Taken together with the EU's own steps to shield operators from Russian court decisions, these developments illustrate a broader pattern. EU sanctions compliance is increasingly a multi-jurisdictional exercise, and EU operators with contractual counterparties, supply chains, or affiliates touching China, Russia, or other third countries with active counter-sanctions regimes should review sanctions clauses in existing contracts, assess the enforceability of those clauses in the relevant third-country courts, and build conflict-of-laws contingencies into new agreements to mitigate these new risks.

New Advanced Technology Items (Annex VII of Regulation 833/2014 and Annex Va of Regulation 765/2006)

New Listed Items (Annex XXI of Regulation 833/2014 and Annex XXVII of Regulation 765/2006)