Page 62 - RusRPTAug24

scheme proposed by Russia. This is in response to the participation of the National Settlement Depository (NSD), which fell under sanctions after the Russian invasion. The restrictions state that no funds or economic resources can be provided to NSD either directly or indirectly. The asset exchange scheme permits Russian and foreign investors to propose exchanges of Western securities currently frozen in NSD accounts within EU central securities depositories for assets being held in Russia from unfriendly investors stored in type C accounts, the directorate explains. Negotiations on the asset swaps between Russian and foreign investors were planned to be held on August 12. Russian investors offered to exchange blocked assets valued at more than ₽35bn ($412M).
The US is preparing to confiscate Russian money: Financial institutions are required to report any Russian assets. The US Treasury Department has required institutions that own Russian state assets to inform about them as part of implementing the Law on Restoring Economic Prosperity and Opportunities for Ukrainians. Therefore, all financial institutions that hold Russian sovereign assets and know or should know about them must report them no later than August 2, 2024. A law passed by Congress in April 2024 requires that all frozen Russian sovereign assets remain frozen until Russia's war against Ukraine ends and Russia pays full compensation to Ukraine or participates in an international mechanism to do so. Financial institutions must report any Russian assets to the US Department of the Treasury’s Office of Foreign Assets Control. These are specific provisions set out in the US lawOn Restoration of Economic Prosperity and Opportunities for Ukraine, which provide for the confiscation of Russian assets for their transfer to Kyiv.
The EU sanctions have had little impact on the Russian economy so far, but they could harm the union in the future, Handelsblatt reports , citing a study by four economic research institutes commissioned by the German Ministry of Economics. The article notes that the Russian economy is showing active growth and experts expressed hope that the sanctions policy could act as a "slow poison." But "if we evaluate soberly, the sanctions policy of the West turned out to be ineffective," since it should have worked quickly, and not stretched out over a long period of time. In the long term, Russia will be able to participate in world trade again, regardless of the West's wishes, writes Handelsblatt. The "slow poison" of sanctions could ultimately harm Western countries themselves, for example through rising oil and gas prices. The freezing of Russian assets, the proceeds of which will be used to help Ukraine, raises concerns among other countries that they could also become the target of such sanctions.
Europe will increase pressure on the Russian shadow fleet, but Moscow is preparing for restrictions on LNG. 44 European countries have agreed on the introduction of measures against the Russian Federation's so-called shadow fleet, which is used to circumvent international restrictions. The joint "call to action" aims to disrupt the fleet of about 600 vessels the Russian Federation uses to transport approximately 1.7mn barrels of oil per day. "We have sent a clear message to those who support Putin's attempts to avoid sanctions: we will not allow the Russian shadow fleet to pass freely through European waters and endanger our security," the British government said. At the same time, the FT writes that frantic demand has led to an increase in prices for old tankers, as secret buyers suspected of ties to Moscow have
62 RUSSIA Country Report August 2024 www.intellinews.com