US introduces new sanctions against Russia banning the provision of IT services

On the eve of the G7 summit in Italy, the United States government imposed more than 300 new sanctions against companies that help Russia wage war in Ukraine and evade already imposed sanctions, the US Treasury Department states.

Regarding IT services

Among the new sanctions is a ban on providing IT services to residents and companies in the Russian Federation. However, this does not concern all services. Three directions have been selected:

  • IT consulting and design services;
  • IT support and cloud services for enterprise management software;
  • Project and production software.

The decision will come into force on September 12, 2024. However, the American authorities note that they “strongly support the free flow of information and communications around the world,” so despite the ban, they continue to allow some telecommunications and Internet transactions.

Other sanctions

In total, the country imposed more than 300 new sanctions on more than 300 individuals and companies, including in Asia, the Middle East, Europe, Africa, Central Asia, and the Caribbean. The full list includes more than a hundred Russian companies linked to the military-industrial complex of the Russian Federation.

Thus, authorities warn that foreign financial institutions are also at risk of being sanctioned for conducting or facilitating significant transactions or providing any services to them.

In the US, more than a dozen transnational networks have been targeted for laundering gold for a Russian manufacturer, supporting Russian drone production, and purchasing materials for chemical and biological weapons, anti-UAV equipment, machine tools, industrial equipment, and microelectronics.

Sanctions were imposed on the Moscow Stock Exchange, the SOGAZ insurance company, the Arctic LNG 1 and Arctic LNG 3 projects, as well as Gazprom Invest.

  • According to Reuters, the Moscow Stock Exchange has suspended trading and settlement in dollars and euros. This means that banks, companies, and investors will no longer be able to trade both currencies through a central exchange, which offers advantages in terms of liquidity, clearing, and supervision.
  • Instead, they will have to trade in the over-the-counter market, where deals are made directly between two parties.
  • A representative of a major Russian exporter of goods that is not under sanctions told Reuters: “We don’t care, we have yuan. It is almost impossible to get dollars and euros in Russia.”
  • As Moscow seeks closer trade and political ties with Beijing, the Chinese yuan has overtaken the dollar as the most popular currency on the Moscow exchange.

Five Russian banks are sanctioned: Promsvyazbank, Vnesheconombank, Sberbank, VTB Bank, and VTB Capital Holding. And also their representative offices in other countries, whatever they are called.

Earlier this year, AIN reported on how Russian companies and entrepreneur avoid sanctions by using cryptocurrency, purchasing weapons and drone parts for their war in Ukraine.