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Business with Russia – what happens now?

The sanctions imposed by Switzerland against Russia are greatly restricting business activities, although there is not a complete embargo. Companies themselves must check whether it is still possible to export and transport products, and whether they can still be paid for. And finally, there is also the question of whether doing business with Russia could damage the company’s reputation.

The sanctions imposed by Switzerland against Russia have been in force since 4 March 2022 and are having wide-reaching consequences for business activities in Russia. In addition, the sanction rulings of other countries such as the USA, the UK and Japan could also be relevant to Swiss companies.

There is currently a great deal of uncertainty among companies that do business with Russia. Although Switzerland has not imposed a comprehensive trade embargo, the exportation of goods and services to Russia is severely restricted. Since 4 March 2022, it has no longer been possible to deliver the following products to Russia:

  • Goods that can be used for both military and civilian purposes (dual-use). The ban on exports applies regardless of what the goods are used for, or who the end user is.
  • Goods and technologies that may contribute to the military and technological strengthening of Russia or to the development of the defence and security sector. Neither can any technical assistance be provided, or financial support arranged or made available in this connection. Accordingly, it is forbidden to provide services of any kind.
  • Goods and technologies intended for the Russian aeronautics and aerospace industries.  No technical assistance such as repairs, remote maintenance, etc. may be provided, or financial support arranged or made available.
  • Goods and technologies that can be used to refine oil.

Important information: All export licences issued by SECO before 4 March 2022 are no longer valid. New licences must be obtained that are assessed on the basis of the law on criminal sanctions rather than on the basis of the Goods Control Act.

What do exporters have to consider?

  1. Anyone wishing to export goods and services to Russia must check themselves whether this is possible. Specifically, the company must carefully go through the lists in the annexes to the Ordinance on Measures in connection with the Situation in Ukraine and check whether or not their product is listed as sanctioned.
  2. The exporter must also check whether the Russian customer is on the sanctions list. If this is the case, the goods cannot be delivered. It is possible to search by name using the search for subjects of sanctions on the SECO website.
  3. Anyone who has business relations with the USA, the UK or Japan must also ensure that any business with Russia does not violate their sanctions rulings. If this is the case, business transactions with Russian customers may result in consequences.
  4. If it is possible to export goods under sanctions law, their transportation must be organized. This presents an additional hurdle, as many forwarding companies are no longer delivering to Russia.
  5. Not least, companies must ensure that the goods delivered can also be paid for. Financial flows are currently severely restricted, and many banks are refusing to carry out financial transactions with Russia in general.
  6. Ultimately, transactions with Russian customers currently pose a significant reputational risk. The terrible images are likely to increase over the coming weeks, along with rising pressure from the media and society on companies that can still deliver to Russia.

The geopolitical situation has changed dramatically within a matter of days, and a further escalation is possible. It is thus clear that the sanctions provisions will continue to change. The version currently applicable to Switzerland is published on the SECO website. Swissmem's member companies can contact our experts directly if they have any questions. Please use the following e-mail address: ukrainekriegnoSpam@swissmem.ch

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Subject-matter experts on the Ukraine war
+41 44 384 41 11 +41 44 384 41 11 ukrainekrieg@swissmem.ch

Last update: 14.03.2022