U.S. Continues to Degrade Russia’s Military-Industrial Base and Target Third-Country Support with Nearly 300 New Sanctions

, and Summarizely AI

May 2, 2024 . 12:09 AM

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U.S. Continues to Degrade Russia’s Military-Industrial Base and Target Third-Country Support with Nearly 300 New Sanctions — WASHINGTON — Today, the Department of the Treasury is taking action to further degrade Russia’s ability to sustain its war machine, continuing a multilateral campaign to limit the Kremlin’s revenue and access to the materiel it needs to prosecute its illegal war against Ukraine. Today’s actions target Russia’s military-industrial base and chemical and biological weapons programs as well as companies and individuals in third countries that help Russia acquire key inputs for weapons or defense-related production.The United States, along with many international partners, is particularly concerned about entities based in the People’s Republic of China (PRC) and other third countries that provide critical inputs to Russia’s military-industrial base. This support enables Russia to continue its war against Ukraine and poses a significant threat to international security. The almost 300 targets being sanctioned by both Treasury and the Department of State include sanctions on dozens of actors that have enabled Russia to acquire desperately needed technology and equipment from abroad. “Treasury has consistently warned that companies will face significant consequences for providing material support for Russia’s war, and the U.S. is imposing them today on almost 300 targets,” said Secretary of the Treasury Janet L. Yellen. “Today’s actions will further disrupt and degrade Russia’s war efforts by going after its military industrial base and the evasion networks that help supply it. Even as we’re throwing sand in the gears of Russia’s war machine, President Biden’s recently-passed National Security Supplemental is providing badly-needed military, economic, and humanitarian support to bolster Ukraine’s courageous resistance. Combined, our support for Ukraine and our relentless targeting of Russia’s military capacity is giving Ukraine a critical leg-up on the battlefield.”In addition to the nearly 200 targets sanctioned by the Department of the Treasury, the Department of State is imposing sanctions on over 80 entities and individuals that are engaged in sanctions evasion and circumvention or are related to Russia’s chemical and biological weapons programs and defense industrial base. The Department of State is also targeting Russia’s revenue generation through its future energy, metals, and mining production and sanctioning additional individuals in connection with the death of opposition leader and anticorruption activist Aleksey Navalny. For more information on State actions, see the Department of State Fact Sheet.The U.S. Department of Justice also filed a forfeiture complaint today against a set of aircraft landing gear for a Boeing 737-800 that was detained in September 2023 at Miami International Airport by U.S. Customs and Border Patrol. The gear was purchased for $1.55 million for the benefit of a Kyrgyz Republic-based transhipper of dual-use items servicing the Russian Federation, in violation of U.S. sanctions on LLC RM Design and Development, which was designated by OFAC in July 2022. SANCTIONS EVASION, CIRCUMVENTION, AND BACKFILLTreasury is committed to disrupting individuals and entities who help facilitate Russia’s acquisition of technology and equipment for its war machine. Treasury and other U.S. government partners have issued extensive guidance and conducted outreach around the world to educate and inform about the risks of doing business with Russia, and Treasury will continue to take unilateral action when necessary to disrupt Russia’s military-industrial supply chains, no matter where they are located. Today’s action includes nearly 60 targets located in Azerbaijan, Belgium, the PRC, Russia, Slovakia, Türkiye, and the United Arab Emirates (UAE), that enable Russia to acquire desperately-needed technology and equipment from abroad. For more information on these targets, please see Annex 1. RUSSIA’S MILITARY-INDUSTRIAL BASE Russia’s military-industrial base relies on a vast ecosystem of entities that enable and support the production, maintenance, transportation, and sustainment of materiel used by Russia’s military. Today’s action takes aim at more than 100 entities operating or that have operated in the technology, defense and related materiel, manufacturing, or transportation sectors of the Russian Federation economy. For more information on these targets, please see Annex 2.Foreign financial institutions that conduct or facilitate significant transactions, or provide any service, involving Russia’s military-industrial base—including any person designated pursuant to E.O. 14024 for operating or having operated in the technology, defense and related materiel, construction, aerospace, or manufacturing sectors of the Russian Federation economy—run the risk of being sanctioned by OFAC. Russia’s military-industrial base may also include individuals and entities that support the sale, supply, or transfer of certain items or classes of items. OFAC has issued Guidance for Foreign Financial Institutions on OFAC Sanctions Authorities Targeting Support to Russia’s Military-Industrial Base.RUSSIA’S ACQUISITION OF EXPLOSIVES PRECURSORSRussia relies on external suppliers for cotton cellulose and its highly flammable byproduct, nitrocellulose, which are key explosives precursors that Russia needs to keep producing gunpowder, rocket propellants, and other explosives. Today’s action targets major Russian importers of cotton cellulose, nitrocellulose, and key inputs to nitrocellulose such as cotton pulp, as well as two PRC-based suppliers sending these substances to Russia. For more information on these targets, please see Annex 3.RUSSIA’S CHEMICAL AND BIOLOGICAL WEAPONS PROGRAM PROCUREMENTTreasury is also targeting three Russia-based entities and two individuals involved in procuring items for military institutes involved in Russia’s chemical and biological weapons programs. In coordination, the Department of State is separately designating three Russian government entities associated with Russia’s chemical and biological weapons programs and four Russian companies contributing to such entities. These actions are being taken concurrent with the Department of State’s imposition of Chemical and Biological Weapons Control and Warfare Elimination Act of 1991 (the CBW Act) sanctions on Russia over its use of the chemical weapon chloropicrin against Ukrainian troops.For more information on these targets, please see Annex 4.EXPANSION OF RUSSIA’S NATURAL GAS INFRASTRUCTUREGuided by commitments made in February by President Biden and G7 leaders to take steps to limit Russia’s future energy revenues and impede Russia’s development of future energy projects, today Treasury is targeting two Russia-based entities involved in natural gas-related construction projects, Neftegazstroy and Aktsionernoe Obshchestvo Vnipigazdobycha. These entities were designated pursuant to E.O. 14024 for operating or having operated in the construction sector of the Russian Federation economy. ANNEX 1: SANCTIONS EVASION, CIRCUMVENTION, AND BACKFILLRussian Unmanned Aerial Vehicle Procurement NetworkTulun International Holding Limited (Tulun International) is a Hong Kong-based procurement intermediary that represented itself as the end-user of, but ultimately resold, Global Navigation Satellite Systems (GNSS) boards that were installed in Russian one-way attack unmanned aerial vehicles (UAVs) used by Russian military forces to attack Ukrainian targets, and shortly thereafter recovered in October and November 2023.Russia-based Limited Liability Company Ultran Electronic Components (Ultran EK) procures microelectronics, including items that have been recovered from Orlan-10 UAVs used against Ukrainian forces. Ultran EK imported 71 shipments of electronic integrated circuits into Russia between June 8, 2022 and September 26, 2023, including electronic integrated circuits with UAV applications such as field programmable gate arrays.After Russia’s February 2022 full-scale invasion of Ukraine, Ultran EK began to rely on Hong Kong-based RG Solutions Limited (RG Solutions) for microelectronics. RG Solutions exported 104 shipments of electronic integrated circuits between January 1, 2023 and December 25, 2023, including electronic integrated circuits with UAV applications such as field programmable gate arrays. RG Solutions engaged in wire transfer activity that indicated the trading of electronic components with military applications to Russia. RG Solutions engaged in payments referencing invoices, transport services, microcircuits, compressor spare parts, freight, and contracts.Hong Kong-based Finder Technology Limited (Finder Technology) exported 293 shipments of electronic integrated circuits between January 3, 2023 and December 29, 2023, including electronic integrated circuits with UAV applications such as field programmable gate arrays. Finder Technology acted as an intermediary for Russia-based Joint Stock Company Compel (Compel) and exported microelectronics to Compel, prior to and following its July 20, 2023 designation by the Department of the Treasury pursuant to E.O. 14024 for operating or having operated in the electronics sector of the Russian Federation economy. PRC-based Juhang Aviation Technology Shenzhen Co, Ltd. (Juhang Aviation) exported 94 shipments of export-controlled items with UAV and other military applications, including items in Tier 1, Tier 2, and Tier 4 of the Department of Commerce Common High Priority List, to Russia-based TSK Vektor OOO (TSK Vektor) between August 5, 2022 and December 31, 2023. Items exported to TSK Vektor by Juhang Aviation included items for UAV production such as propellers, signal jammers, sensors, and UAV engines. TSK Vektor was designated by the Department of the Treasury pursuant to E.O. 14024 on December 12, 2023, for providing material support to IEMZ Kupol, which produces one-way attack UAVs for the Russian Ministry of Defense and was designated by the U.S. Department of the Treasury pursuant to E.O. 1…

The United States Department of the Treasury has announced new sanctions targeting Russia's military-industrial base and chemical and biological weapons programs. The sanctions also include companies and individuals in third countries that help Russia acquire key inputs for weapons or defense-related production. The U.S. is particularly concerned about entities based in the People’s Republic of China and other third countries that provide critical inputs to Russia’s military-industrial base. The Department of State is also imposing sanctions on over 80 entities and individuals that are engaged in sanctions evasion and circumvention or are related to Russia’s chemical and biological weapons programs and defense industrial base. The U.S. Department of Justice has also filed a forfeiture complaint against a set of aircraft landing gear for a Boeing 737-800 that was detained in September 2023 at Miami International Airport by U.S. Customs and Border Patrol. The gear was purchased for $1.55 million for the benefit of a Kyrgyz Republic-based transhipper of dual-use items servicing the Russian Federation, in violation of U.S. sanctions on LLC RM Design and Development, which was designated by OFAC in July 2022. Treasury is committed to disrupting individuals and entities who help facilitate Russia’s acquisition of technology and equipment for its war machine. The U.S. is imposing sanctions on almost 300 targets, including nearly 60 targets located in Azerbaijan, Belgium, the PRC, Russia, Slovakia, Türkiye, and the United Arab Emirates. The sanctions also target Russia’s acquisition of explosives precursors, chemical and biological weapons program procurement, and expansion of Russia’s natural gas infrastructure. The U.S. is also targeting entities involved in Russia's military-industrial base and its acquisition of technology and equipment. These actions are part of a multilateral campaign to limit Russia’s revenue and access to the materiel it needs to prosecute its illegal war against Ukraine.

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