Updated 'No Re-Export to Russia' Requirement
On 24 June 2024, the EU Council announced the 14th package of sanctions against Russia.
As mentioned in our previous briefing (Aviation: Guidance on 'No Re-Export to Russia' clauses), the 12th package of sanctions against Russia introduced Article 12g into Council Regulation (EU) No 833/2014, requiring EU exporters to contractually prohibit the re-exportation to Russia and the re-exportation for use in Russia of certain goods when exporting, selling, supplying or transferring those goods from the EU to certain third countries (the No Russia Clause). From an Aviation perspective, in-scope goods include aircraft, engines and other aircraft parts. "Supplying" in this context includes the leasing or subleasing of aircraft or engines.
The 14th package of sanctions has amended Article 12g – the following changes will be of interest to our Aviation clients:
- A new exemption for public contracts: contracts entered into with public authorities in third countries or with international organisations do not need to include a No Russia Clause, but EU exporters must inform their national competent authority within 2 weeks of concluding a contract that benefits from this exemption.
- The deadline to incorporate a No Russia Clause in agreements concluded before 19 December 2023 has been extended from 20 December 2024 to 1 January 2025.
Article 12g has also been amended to carve out contracts relating to certain machinery from the requirement to include a No Russia Clause.
The European Commission has updated its Guidance on Article 12g to reflect these changes.
New 'No Re-Export to Belarus' Requirement
Separately, on 29 June 2024, the EU Council announced further sanctions targeting Belarus, again amending Council Regulation (EC) No 765/2006 (by Council Regulation (EU) 2024/1865) to further mirror several of the restrictive measures already in place against Russia.
Of note for our Aviation clients is the newly inserted Article 8g which requires EU-based exporters to include a 'No Belarus clause' in contracts for the export of specific types of goods from the EU to certain third countries (contractually prohibiting the re-exportation to Belarus, and the re-exportation for use in Belarus, of those goods). Article 8g largely reflects the recently amended Article 12g referred to above, save that it only applies to new contracts entered into on or after 1 July 2024 (i.e. there is no requirement to insert a form of 'No Belarus clause' into contracts concluded prior to 1 July 2024).
Similar to steps taken after the introduction of Article 12g, clients should familiarise themselves with the amended sanctions frameworks in respect of both Russia and Belarus to ensure ongoing compliance. In addition to the existing requirements to include a No Russia Clause, from 1 July 2024 onwards relevant contracts should also include a 'No Belarus clause'.
This article contains a general summary of developments and is not a complete or definitive statement of the law. Specific legal advice should be obtained where appropriate.