March 4, 2022 Update: This post was updated after BIS published new export controls on oil and gas equipment and Entity List sanctions on firms related to the Russian defense industry.
Today, the United States announced another round of significant sanctions and export control restrictions on Russia and Belarus in response to the deteriorating situation in Ukraine. Today’s actions subject Belarus to the same harsh export control restrictions that were imposed on Russia last week and effectively close U.S. airspace to Russian aircraft. The White House also announced that United States would impose new restrictions on exports of oil and gas equipment to Russia and blocking sanctions on Russian defense companies. We expect the Commerce and Treasury Departments to implement those restrictions in the coming days.
U.S. Belarus Export Controls
In coordination with the European Union, the U.S. Commerce Department announced amendments to the Export Administration Regulations today that subject Belarus to the same sweeping export control restrictions as those imposed on Russia last week.
The new rules effectively prohibit the export, re-export, or transfer of a broad range of dual-use items to Belarus, including all items listed in Categories 3 through 9 of the Commerce Control List, the U.S. dual use control list. With limited exception, the U.S. government will review license applications related to these exports subject to a presumption of denial, which means that licenses will rarely be granted. The rules also impose broad restrictions on exports of items to Military End Users and Uses in Belarus and added add two Belarusian entities to the Entity List as “military end users,” broadly prohibiting the transfer of items subject to the EAR to the listed parties.
Today’s amendments also extend the “Foreign Direct Product Rule” (FDPR) to apply exports to Belarus and Belarusian Military End Users, expanding the scope of items manufactured outside the United States that are now subject to U.S. export control and licensing requirements.
Additional information on the nature of these expanded controls is available in our prior post on Russia, available here.
Oil & Gas Equipment Restrictions
The White House announced that the United States would adopt new export controls on oil and gas extraction equipment shipped to Russia. The new controls are designed to limit the ability of Russia to support its refining capacity over the long term. Additional information about the oil and gas export controls is available here. The EU also recently imposed similar restrictions on an array of items used for oil refining.
The White House also announced that 22 Russian defense-related entities would be added the List of Specially Designated Nationals (SDN List), including companies that manufacture “combat aircraft, infantry fighting vehicles, electronic warfare systems, missiles, and unmanned aerial vehicles for Russia’s military.” As of this writing, the SDN List had not yet been updated with these entities.
On March 4, 2022, BIS added 91 entries to its Entity List, effectively prohibiting exports of items “subject to the EAR” to the listed parties. The entities, which are located in Belize, Russia, Singapore, and the United Kingdom, were sanctioned for their involvement or support of Russian security, military, and defense efforts.
In coordination with U.S. allies, the United States also announced the closure of U.S. airspace to Russian aircraft. The new measures ban aircraft certified, operated, registered or controlled by any person connected with Russia from the United States. Accordingly, the Department of Transportation issued a notice today revoking Russian passenger and cargo airlines’ ability to operate to and from U.S. destinations and refusing entry of Russian-operated aircraft into U.S. airspace.