Swiss sanctions against Russia – Further alignment with the EU 15th Sanctions Package

1. Introduction

On 12 February 2025, the Swiss Federal Council adopted further sanctions against Russia with a view to mirroring the latest measures imposed by the EU on 16 December 2024. The corresponding amendments to the Ordinance on measures in connection with the situation in Ukraine ("UKRO") entered into force on 13 February 2025.

This follows previous sanctions update from 23 December 2024, when Switzerland aligned its financial sanctions lists with the EU by imposing additional asset freezes and travel bans on 54 individuals and 30 entities involved in Russia's military aggression against Ukraine. At that time, 52 new vessels were also targeted notably due to their role in transporting Russian crude oil, petroleum products and goods and technology used in the Russian defence and security sectors.

In addition, on 16 January and, then, on 6 February 2025, the Swiss State Secretariat for Economic Affairs ("SECO") updated its "frequently asked questions" ("FAQ") document. The latest updates do not introduce material changes but instead refine certain formulations to clarify the application of existing sanctions provisions.

A free English translation of UKRO as of 13 February 2025 and a redline against the version of 2024 are available, respectively here and here. A free English translation of the SECO FAQ document as of 6 February 2025 and a redline against the version of 27 August 2024 are available, respectively here and here.

2. New restrictions on legal proceedings and court rulings involving Russian companies

In 2020, Russia amended its Arbitrazh Procedural Code ("APC") and introduced Article 248 APC. The purpose of this provision is to safeguard Russia's interests and ensure that all disputes involving Russian companies are decided by its domestic courts. In particular, Article 248 APC provides that:

• Russian courts shall have exclusive jurisdiction over disputes where the proceedings involve sanctioned Russian entities and/or where the dispute itself arises out of sanctions imposed on Russian entities or individuals (Article 248.1 APC). This also applies in cases where the parties have a prior agreement that disputes should be resolved in a forum outside of Russia (Article 248.1(4) APC).
• Russian parties affected by sanctions may apply to Russian courts for anti-suit injunctions against foreign courts and arbitral tribunals (Article 248.2 APC).
• In case of non-compliance with anti-suit injunctions, fines up to the amount in dispute may be imposed under the Russian Criminal Code.

In order to protect the rights of Swiss companies and shield them from potential financial damage, Switzerland has adopted the following restrictive measures in response:

• Injunctions, orders, measures, judgments or other judicial decisions issued pursuant to Article 248 APC or deriving from it or from an equivalent provision of Russian legislation shall not be recognised, implemented or enforced in Switzerland (Article 29d(1) UKRO).
• Requests for criminal assistance in connection with an alleged violation of any such injunction, order, measure, judgment or other judicial decision shall not be enforced in Switzerland (Article 29d(2) UKRO).
• Penalties or other sanctions imposed under the Russian Criminal Code in connection with an alleged violation of an injunction, order, measure, judgment or other court decision as explained above shall not be recognized or enforced (Article 29d(3) UKRO).

These measures provide comfort for Swiss parties who have initiated court or arbitration proceedings against Russian entities. However, certain situations which are not covered by these new measures remain uncertain:

• Enforcement of arbitral awards issued by an arbitral tribunal seated in Russia: In cases where an arbitration agreement provides for arbitration seated in Russia, there is a risk that an arbitral award may be issued that does not follow Swiss sanctions and which orders the performance of certain obligations in disregard of said sanctions. Such an award may in principle be recognized and enforced in other jurisdictions under the Convention on the Recognition and Enforcement of Foreign Arbitral Awards ("New York Convention"). However, recognition and enforcement of awards contravening sanctions may be refused as being contrary to public policy (Article V(2)(b) New York Convention).
• Enforcement of Russian penalties / sanctions for non-compliance with anti-suit injunctions outside of Switzerland: Swiss parties need to be aware of the possibility that decisions imposing penalties / sanctions for non-compliance with anti-suit injunctions may be enforced outside Switzerland or the EU, where assets are located.

3. Extension of divestment deadlines

New provisions extend the deadline for divestment-related exemptions until 31 December 2025, allowing Swiss entities to finalize their withdrawal from Russian markets in a structured manner.

The new deadline applies in four key areas:

• Goods, technologies and intellectual property rights (Articles 30a UKRO)
  • Sale, delivery, transit or transport of restricted goods and technologies listed in Annexes 1, 3, 4, 5, 16, 18, 19 and 23.
  • Associated intellectual property rights and trade secrets necessary for divestment from affected markets.
  • Import, transit and transport of specific goods listed in Annexes 17 and 20, subject to SECO conditions.
• Services and software prohibited under Article 28e UKRO (Article 30c UKRO).
• Transactions with Russian state-owned companies prohibited under Article 24a (1) UKRO (Article 30b UKRO).
• Prohibition on honouring certain financial claims under Article 30 UKRO (Article 30c^bis UKRO).

These exemptions require prior SECO approval and are only available where strictly necessary for asset divestment or liquidation of activities in Russia.

4. Due diligence – Reminder for financial institutions

Financial institutions should remain particularly vigilant to the risk of indirectly facilitating restricted transactions through providing financial services or financing. Indeed, in addition to prohibiting specific commercial activities, Swiss sanctions also restrict the financing of such activities, including the provision of loans, credit facilities, leasing, guarantees and insurance when linked to transactions involving sanctioned entities or sectors, as well as financial services more generally in certain specific cases.

This is particularly relevant when dealing with counterparties in jurisdictions considered to be "friendly" under Russian legislation, where there is an increased risk of sanctions circumvention. Financial institutions should ensure that financial services they provide do not indirectly support transactions that ultimately fall under Swiss sanctions prohibitions.

A notable risk area is the crude oil sector, where transactions involving vessel leasing, shipping or crude oil trading require enhanced due diligence. If a financial institution provides financial services – including payments processing or treasury management – to a client involved in vessel chartering, for example, where vessels may be used to transport Russian crude oil, the financial institution should verify that such financial services do not indirectly facilitate transactions that breach price cap regulations.

In such situations, financial institutions should consider implementing a comprehensive risk management approach, including:

• Enhanced due diligence procedures, ensuring verification of counterparties, beneficial owners and end-users, respectively destination of restricted goods (e.g., oil, luxury goods, etc.) to assess potential exposure to sanctioned transactions.
• Explicit contractual representations and warranties, requiring clients to certify compliance with applicable sanctions regimes, respectively certifications that certain goods will not be sourced from or delivered to Russia or other restricted regions.
• Continuous monitoring of payment flows and transaction structures, particularly in cases where financial services are provided to clients operating in high-risk jurisdictions or where there are indications of re-export or indirect trade financing.
• Internal escalation procedures, ensuring that potential red flags – such as complex trade routes, non-transparent payment structures or counterparties with previous sanctions exposure – are promptly reviewed by compliance teams.

Given the evolving regulatory landscape, financial institutions should regularly review and strengthen their internal risk management frameworks to ensure full compliance with Swiss and international sanctions.

5. Future developments

Sanctions are amended and adapted on an ongoing basis. Given the importance of the topic and the potentially serious legal and reputational consequences of a breach, it is essential to keep abreast of the latest measures and any guidance issued by the Swiss government. We are monitoring these developments closely.

At this juncture, the introduced restrictions raise a number of interpretation and implementation questions. Some of those questions are expected to be clarified based on EU sanctions guidance and FAQs, if any, whereas other issues will require formal confirmation from SECO. We are working with our clients to clarify the expectations of competent authorities and to find practical solutions for an efficient operational implementation of the sanctions framework.

6. Useful links

Given the fluid nature of the sanctions, we enclose some relevant resources which we trust will be of assistance for monitoring the developments:

6.1 Swiss Sanctions

UKRO, as of 13 February 2025

• Official publication:
  • UKRO German version
  • UKRO French version
  • Unofficial English translation
  • Redline against the version of 17 October 2024 (English)

SECO FAQ, as amended on 6 February 2025

• Official publication:
  • German version
  • French version
  • Unofficial English translation
  • Redline against the version of 27 August 2024 (English)

6.2 EU Sanctions

• Consolidated texts of sanctions regulations
  • Consolidated text of Regulation (EU) No 833/2014 (Russia)
  • Consolidated text of Regulation (EU) No 269/2014 (Ukraine territorial integrity)

Compilation of frequently asked questions regarding EU sanctions available here: link.

Please do not hesitate to contact us in case of any questions.

You may reach out to your usual contact at our firm or direct any sanction-specific queries to our dedicated task force at sanctions@lenzstaehelin.com.

Legal Note: The information contained in this Smart Insight newsletter is of general nature and does not constitute legal advice.