BOFIT Viikkokatsaus / BOFIT Weekly Review 2017/31

The "Countering America's Adversaries Through Sanctions Act" tightens some of existing sanctions on Russia, creates the possibility for imposing new sanctions and makes it harder for the US president to lift or ease them. Europeans reacted most to the act's threatened extension to projects involving the maintenance, expansion and construction of Russia's oil & gas export pipelines. The new law could affect e.g. several major gas pipelines including the Power of Siberia, NordStream2 and TurkishStream, and hence might impact also the operations of some major European energy companies.

Monitoring for compliance with economic sanctions is difficult and sometimes subject to discussion. Recent examples include the case of the oil giant Exxon that has stated it would appeal its two-million-dollar fine, which was levied after Rosneft made a deal with Exxon in 2014. The US Treasury Department claims the deal violated the sanctions regime in force at the time. Similarly, the German Siemens conceded that its joint venture partner in St. Petersburg violated sanctions imposed by the EU by sending gas turbines to a power plant project in Crimea.

After Congress passed the bill, Russia announced it was limiting the number of US embassy personnel in Russia to 445 people and denying access of personnel at the US embassy to their summer estate outside Moscow. The measures are at least partly responses to measures announced by the US in December 2016 that forced Russia to surrender two major estates near New York and outside Washington DC.

Show weekly Review 2017/30 Show weekly Review 2017/32