The EU Must Start Combating Sanctions Evasion at Home

The issue of sanctions evasion has emerged as a critical challenge in the European Union's efforts to curtail Russia's war machine. Josep Borrell, the EU's High Representative for Foreign Affairs and Security Policy, has emphasized that the fight against sanctions evasion must begin within the EU itself. Borrell’s remarks, delivered at a press conference in Luxembourg following the EU Foreign Affairs Council meeting, bring to light the fact that despite sanctions, Russia continues to acquire electronic components for its military, many of which originate from European countries.

"Sanctions evasion allows Russia to sustain its war effort," Borrell stated, drawing attention to the loopholes that enable Russia to access Western technology. These components often find their way into Russian weapons and military equipment, despite stringent sanctions in place. Borrell called for EU member states to enhance control over the export activities of companies producing sensitive electronic components, suggesting that the root of the issue lies closer to home than many might assume. Instead of focusing solely on third countries, the EU must strengthen internal mechanisms to prevent these materials from reaching Russia.

Borrell's words underscore the EU's responsibility in addressing the problem: "When you perform an autopsy on Russian weapons, you find Western electronic components inside." This stark reminder points to the ongoing leakage of critical technologies into Russia's military supply chain, despite the EU's sanctions regime. Borrell stressed the need for more robust measures to combat this evasion, particularly by enhancing oversight of companies that export these critical elements to non-EU countries.

Strengthening EU's Sanctions Enforcement

During the Foreign Affairs Council, ministers discussed ways to fortify the sanctions already imposed on Russia. David O'Sullivan, the EU's Special Representative for Sanctions, presented proposals to improve the effectiveness of the sanctions regime. A primary concern remains Russia’s ability to continue exporting oil despite the price caps and trade restrictions imposed by the EU.

One of the most pressing issues highlighted was the role of Russia’s so-called "shadow fleet." This fleet has enabled Russia to bypass sanctions and continue exporting hydrocarbons, particularly oil, at prices above the EU-imposed ceilings. O'Sullivan urged ministers to consider additional measures to counteract these tactics, reinforcing the EU's commitment to halting Russia's ability to fund its war through oil exports.

"More sanctions are needed against Russia's shadow fleet and against its capacity to export hydrocarbons," Borrell stressed, reinforcing the need for further actions to close these loopholes. This push for additional sanctions aims to prevent Russia from sidestepping the restrictions that are already in place.

EU's New Sanctions Against Hybrid Warfare

The EU has also moved to address other forms of aggression by Russia, particularly hybrid warfare. Last week, the EU adopted a new legal framework for sanctions targeting hybrid actions by Russia. These sanctions are aimed not only at military activities but also at disinformation campaigns, cyberattacks, and other destabilizing efforts directed at EU member states and partners.

This expanded sanctions regime reflects the EU's recognition of the multifaceted nature of Russia's aggression. While military conflicts are the most visible, hybrid warfare tactics such as spreading disinformation and engaging in cyberattacks have become an integral part of Russia’s strategy to weaken its adversaries. By expanding sanctions to target these activities, the EU is taking a more comprehensive approach to countering Russian aggression.

In a significant move on October 14, the EU imposed sanctions for the first time on entities involved in supplying ballistic missiles from Iran to Russia. These sanctions target seven individuals and seven institutions in Iran, marking a new phase in the EU’s efforts to disrupt the supply chains that enable Russia to continue its military operations.

Sanctions Evasion: A Global Issue with European Roots

The issue of sanctions evasion extends far beyond the borders of the EU. According to the Kyiv Research Institute of Forensic Expertise of the Ministry of Justice of Ukraine, Russian missiles and drones used in attacks on Ukrainian cities contain components from over 20 different countries. A significant portion of these components, particularly the electronic parts, are produced in Western countries, including the United States, Germany, and the United Kingdom. While these components were not originally intended for military use, Russia has found ways to repurpose them for its weapons production.

This global trade in electronic components underscores the complexity of enforcing sanctions in an interconnected world. Although the sanctions imposed by the EU and its Western allies are designed to limit Russia’s access to critical technologies, the ease with which these components are diverted through third countries or re-exported after slight modifications poses a significant challenge.

In 2023 alone, Russia managed to import over $1 billion worth of chips used in weapon production, circumventing Western sanctions. Since the beginning of its full-scale invasion of Ukraine, Russia has fired more than 8,000 missiles of various types at Ukrainian targets. Many of these missiles were produced using Western components that found their way into Russia's military-industrial complex despite the sanctions.

Strengthening Internal Controls to Prevent Evasion

Given the widespread evidence of sanctions evasion, the call for stronger internal controls within the EU is timely. The focus on domestic enforcement reflects an understanding that preventing the flow of critical technologies to Russia requires more than just external pressure on third countries. It also demands a rigorous examination of the EU's own companies and export practices.

Borrell’s remarks reflect a growing consensus that the fight against sanctions evasion must begin at home. By tightening export controls and enhancing oversight of companies involved in producing sensitive technologies, the EU can better prevent these materials from reaching Russia through indirect channels.

While much of the focus has been on third countries like China and Turkey, which have been accused of facilitating Russia's access to sanctioned goods, the reality is that many of the components used in Russian weapons originate in the EU itself. Strengthening internal controls will not only enhance the effectiveness of the EU's sanctions but also set an example for other countries to follow.

The Role of Third Countries in Sanctions Evasion

Although Borrell emphasized the need for the EU to start combating sanctions evasion at home, third countries also play a crucial role in enabling Russia to continue acquiring critical technologies. Many of the components used in Russian weapons are exported to intermediary countries before being re-exported to Russia, making it difficult to trace their origins.

Countries such as China, Turkey, and India have been highlighted as potential intermediaries in this process. By purchasing European-made electronic components and then selling them to Russia, these countries help Russia circumvent the EU's sanctions. While these countries may not be directly involved in supporting Russia’s war effort, their role in enabling sanctions evasion cannot be ignored.

To address this issue, the EU has been working closely with third countries to ensure that they do not become conduits for sanctioned goods. However, enforcing these agreements has proven difficult, as many of these countries have economic incentives to maintain trade relations with Russia.

A Path Forward: Enhancing Global Cooperation

To effectively combat sanctions evasion, the EU must not only strengthen its own internal controls but also work with its global partners to close the gaps in the sanctions regime. This requires greater cooperation with countries outside the EU to ensure that sanctioned goods do not reach Russia through indirect channels.

One possible solution is the creation of a global coalition to monitor and enforce sanctions more effectively. Such a coalition could include not only EU member states but also other major economies such as the United States, Japan, and South Korea. By pooling resources and intelligence, this coalition could help identify and shut down the networks that facilitate sanctions evasion.

In addition to monitoring sanctions compliance, the EU could also consider offering incentives to third countries to discourage them from engaging in trade with Russia. By providing economic alternatives, the EU could reduce the financial incentives for countries like China and Turkey to continue exporting goods to Russia.

Conclusion

Sanctions evasion is a complex issue that requires a multifaceted approach. While the EU has made significant progress in combating this problem, much more needs to be done to ensure that Russia cannot continue to access Western technologies for its military operations. As Josep Borrell pointed out, the fight against sanctions evasion must start at home, with the EU strengthening its internal controls to prevent sensitive technologies from reaching Russia.

At the same time, the EU must work closely with its global partners to close the loopholes that allow Russia to circumvent sanctions. By enhancing global cooperation and offering economic incentives to third countries, the EU can ensure that its sanctions regime remains effective in limiting Russia’s ability to sustain its war machine.

In the end, the success of the EU’s sanctions policy will depend on its ability to adapt to the changing nature of global trade and technology. Only by taking a proactive approach to combating sanctions evasion can the EU hope to achieve its goal of stopping Russia’s aggression and restoring peace in Ukraine.