Gard, which usually gains tonnage at renewal, is reported to be taking the toughest line in resisting significant reductions and may pay a price in tonnage terms as a result.
They will likely remain relatively extensive in the year ahead. Companies will have to continue to comply with a complex and extensive regime, which was significantly extended once again just before Christmas. This article provides 1 an overview of the measures currently in place and 2 some additional guidance on practical problems businesses may face in seeking to comply with these measures.
A Complex Regime The EU sanctions architecture against Russia is currently built upon three separate elements, making this a complex set of rules with potentially far-reaching consequences for businesses. As of Januaryindividuals and 28 entities were subject to an EU asset freeze and a prohibition on EU third parties to make available funds and economic resources to these individuals and entities.
It is noteworthy that this element to the EU sanctions regime on Russia was significantly extended on Dec. In particular, in-house legal teams need to be able to ensure compliance with the latest set of rules almost instantly. As an example, Germany grants companies a mere two-day grace period within which to implement EU restrictive measures.
Indeed, businesses today are expected to have in place sophisticated compliance programs. This expectation stems not just from public authorities. Investors regularly make their investment conditional upon robust compliance standards being in place. Equally, lenders may require their creditors to ensure trade compliance measures are set up at third-party target companies.
The moment a company discovers it has commercial dealings with a sanctioned counterparty, this throws up a number of issues. For instance, how should commercial agreements with blacklisted counterparties be treated?
These provisions are typically available in the relevant EU regulations. But even where a company wishes to cease dealings in order to comply with sanctions, this may trigger another issue: Can companies terminate their contractual obligations because of EU sanctions imposed upon their counterparty?
Groupama Transport ,[ 25] a widely drafted force majeur clause may entitle an innocent party to cease performing its preexisting contractual obligations due to the potential of breaching sanctions if the contract were to be performed.
Under English law, no force majeur provision will be implied in the absence of specific contractual provisions. Thus, companies should ensure such clauses are expressly included in the contract and are carefully drafted to provide for the type of risks that could arise out of political instability, including the imposition of sanctions.
Under English law, a company in contractual relations with a designated entity may also consider whether its contract has been frustrated, and is therefore capable of being terminated, because performance of contractual obligations has been rendered impossible due to supervening illegality.
This doctrine, though, is not applied lightly.
Recent English case law Melli Bank v. Companies should therefore be mindful that they may have to exhaust alternative options to secure contractual performance prior to seeking to rely on frustration as a basis to terminate a contract.
In particular, companies may need to establish whether they could benefit from a derogation and obtain a license from the relevant national competent authority. Based on recent remarks by the European Parliament and Mogherini, the EU sanctions regime against Russia looks set to remain in place for the foreseeable future.
European companies conducting business with Russian or Crimean counterparties will have to ensure that an adequate internal compliance infrastructure is in place, while continuing to monitor any future developments carefully.
That said, this requirement may also present compliance teams with an opportunity to review internal procedures more broadly and emphasize the importance of this area internally. The opinions expressed are those of the author s and do not necessarily reflect the views of the firm, its clients, or Portfolio Media Inc.
This article is for general information purposes and is not intended to be and should not be taken as legal advice. EU Council, Guidelines on implementation and evaluation of restrictive measures sanctions in the framework of the EU Common Foreign and Security Policy — new elements, April 30,available at http: What Swiss businesses have to consider, available at http: Rosneft, Transneft, and Gazprom Neft.
Counter-Terrorism Actavailable at http:TEHRAN: The Chief Executive of the State-run entity Islamic Republic of Iran Shipping Lines (IRISL) announced recently that Foreign funds worth $ million for purchasing ships by the IRISL have been finalized. The Steamship Mutual 03 Underwriting Association (Bermuda) Limited Directors Directors O.
H. Fritzner, (Chairman) A. Abraha, Ethiopian Shipping Lines C. J. Ahrenkiel, Ahrenkiel Consulting Services M. Bayley, Royal Caribbean International (appointed 27th October ) S-M. Edye, Sloman Neptun Schiffahrts AG. Islamic Republic of Iran Shipping Lines -v- Steamship Mutual and HM Treasury  EWHC (Comm) Christopher Butcher QC – Oil Pollution – Counter Terrorism Act; Financial Restrictions (Iran) Order – Effect of Club cover for Liability and Frustration of Contract.
1 Islamic Republic of Iran Shipping Lines v Steamship Mutual Underwriting Association (Bermuda) Limited  EWHC (Comm) 2 International Convention on Civil Liability for Bunker Oil Pollution Damages Islamic Republic of Iran Shipping Lines v. Steamship Mutual Underwriting Association (Bermuda) Ltd __ - Commercial Court 26 October **.
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