No-Russia clause (Article 12g)

EU sanctions against Russia prohibit exporting a long list of goods there. But a growing share of these goods reached Russia through third countries, which imported them from Europe and then re-exported them. The eleventh sanctions package, adopted in June 2023, inserted into Regulation (EU) No 833/2014 an Article 12g, applicable to contracts concluded since December 2023. Any EU exporter selling to a customer located outside the Union and certain partner countries goods on specific lists, high-priority items used by the Russian military, firearms, aviation goods, must include in the contract a clause prohibiting re-export to Russia or for use in Russia, and provide adequate remedies for breach. The exporter must then inform the authorities if it learns the clause has been breached. The mechanism turns a commercial contract into a foreign policy tool and places on the exporter a duty of vigilance over its customer. For insurance, it bears on trade credit and cargo insurance, whose cover may be excluded in case of sanctions breach, and on directors' liability, since breaching restrictive measures is now a criminal offense throughout the Union.