• This circular supplements Circular 6/14 issued on 16th July 2014 on amendments to Regulation 692/2014 concerning restrictions on the import into the Union of goods originating in Crimea or  Sevastopol
• All other clubs in the International Group have issued a similar circular.

TO THE MEMBERS

Dear Sirs,

COUNCIL REGULATION (EU) No 825/2014 of 30th July 2014 concerning restrictions on the import into the Union of goods originating in Crimea or Sevastopol, in response to the illegal annexation of Crimea and Sevastopol ("the Regulation")

In response to the annexation of Crimea and Sevastopol by Russia, the European Union published Regulation 692/2014 of 23rd June 2014, introducing trade sanctions in respect of goods originating in Crimea or Sevastopol and on the provision, directly or indirectly, of financing or financial assistance, as well as insurance and reinsurance, related to the import of such goods.

On 30th July the European Union published Regulation 825/2014 amending Regulation 692/2014. This circular therefore supplements circular 6/14 issued on 16th July 2014. The most notable amendments add further to the prohibitions in Article 2, which we have noted below.

Article 2 of the Regulation provides that it is prohibited:

• To import into the European Union goods originating in Crimea or Sevastopol.
• To provide, directly or indirectly, financing or financial assistance as well as insurance and reinsurance related to the import of goods originating in Crimea or Sevastopol.
• To sell, supply or transfer designated key equipment and technology¹ for infrastructure projects in the transport, telecommunications and energy sectors in Crimea or Sevastopol.
• To sell, supply or transfer key equipment and technology for the exploitation² of oil, gas and mineral resources³ in Crimea or Sevastopol.
• To provide technical and financial assistance related to the above activities.
• To sell, supply, transfer, export, directly or indirectly, key equipment and technology listed in Annex III to any natural or legal person, entity or body in Crimea or Sevastopol or for use in Crimea or Sevastopol

Contracts entered into before 30th July 2014 (including ancillary contracts) must be executed by 28th October 2014.

Goods" are defined as originating in Crimea or Sevastopol which are wholly obtained in Crimea or in Sevastopol or which have undergone their last substantial transformation there.

Article 3 of Regulation 692/2014 of 23rd June 2014 provides for the execution of trade contracts until 26th September 2014 in respect of such contracts concluded before 25th June 2014 or of ancillary contracts necessary for their execution. Article 3 also requires persons, entities or bodies seeking to perform the contract to provide a minimum of 10 days advance notice to their EU Member State Competent Authority. Furthermore goods made available to the Ukrainian authorities and entitled to "preferential origin" status in accordance with Regulation (EU) No 978/2012 and Regulation (EU) No 374/2014 or the EU-Ukraine Association Agreement may also be exempt.

Article 6 of Regulation 692/2014 of 23rd June 2014, as amended prohibits the payment of claims in respect of contracts or transactions which are prohibited by the Regulation if they are made by designated persons, entities or bodies listed in Council Regulation 269/2014; persons, entities or bodies acting on behalf of designated entities; persons, entities or bodies who have been found by a competent authority to have infringed the prohibitions in Regulation 692/2014; or if claims relate to the import of goods originating in Crimea or Sevastopol.

Article 10 of Regulation 692/2014 of 23rd June 2014, as amended provides that it shall apply:

• Within the territory of the European Union.
• On board any vessel under the jurisdiction of an EU Member State.
• To all nationals of any EU Member State wherever located.
• To any legal person, entity or body, which is incorporated or constituted under the law of an EU Member State.
• To any legal person, entity or body in respect of any business in whole or in part within the European Union.

It is unlawful for European flagged or managed vessels to perform trade prohibited by EU regulations and P&I clubs domiciled in the European Union cannot provide P&I insurance to any vessel of whatever nationality engaged in such trade. The prohibitions will also apply to non-EU domiciled Members and Clubs to the extent that the prohibited activity and/or insurance provided constitutes business done in whole or in part of the EU. All International Group Club rules contain exclusions in relation to claims arising from trades for which it is unlawful to provide insurance by reason of sanctions.

Regulation 825/2014 entered force on 31st July 2014.

All other clubs in the International Group have issued a similar notice.

Yours faithfully,

THE MANAGERS

Nigel Carden

Email: nigel.carden@thomasmiller.com

Tel: +44 20 7204 2147

.The EU's list of designated goods can be found in Annex III of the Regulation.

"exploitation" means exploration, prospection, extraction, refining and management of oil, gas, and mineral resources and provision of related geological services but does not include maintenance to ensure safety of existing infrastructure

The list of designated mineral resources can be found in Annex II of the Regulation.