UK waives sanctions on Russian bank — Analysis

British authorities are allowing payments to a Russian financial institution to safeguard Europe’s gas supply

The United Kingdom has granted a license for continued payments to Russia’s Gazprombank for more than a month, despite sanctions imposed on the firm and dozens of other Russian banks last month.

London’s Office of Financial Sanctions Implementation (OFSI) issued the sanctions waiver on Thursday for “the purpose of making gas available for use in the European Union,” noting that the license expires on May 31.

The license covers contracts signed before Thursday with Gazprombank or its subsidiaries. “the opening and closing of bank accounts”As long as the EU is able to receive gas from outside, it’s acceptable. 

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Following a flurry of other financial penalties in the wake of Moscow’s attack on Ukraine, the UK government imposed sanctions on Gazprombank late last month, also targeting other major financial firms such as Alfa Bank. However, Treasury referenced a 2019 law which allowed exemptions to penalties for Russia in some circumstances when announcing its latest waiver. 

While Russia has been penalized for its actions, many European nations still depend on Russian energy sources. There is some hesitation to support embargoes of gas, oil, and coal.

Gazprombank, which is one of the most important Russian banks by assets, works mainly in the investment and corporate sectors. The United StatesAnd a series of allies slapped penalties on the bank in February, imposing debt and equity restrictions after Russia attacked Ukraine, part of a coordinated effort to “isolate” and “cripple” Russia’s economy.

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