A group of member states is pushing to dilute proposals by the European Union (EU) aimed at cracking down on the circumvention of sanctions on Russia through third countries, according to people familiar with the matter, Bloomberg reported.
The bloc’s executive arm, the European Commission, has proposed banning importers from reselling so-called high-priority items—like semiconductors used in weapons or needed to make them—to Russia or for use in Russia, and requiring a sum to be deposited in an escrow account to ensure compliance.
In case of the ban's violations, at least half of this deposit would be sent to a Ukraine trust fund, and the contracts would be terminated.
A "group of big member states" reportedly raised concerns about the legality and feasibility of such a move.
These countries also prefer a more limited scope of clauses and goods covered by this measure and voiced worries of competitive disadvantage for European companies, the sources told Bloomberg.
The EU is currently working on its 12th Russia sanctions package, which may reportedly include export bans on machine parts and other dual-use goods, a ban on the export of Russian diamonds, and measures to reinforce the $60 per barrel price cap on Russian oil.
Both the EU and the US have long sought to curtail Russia's ability to acquire sanctioned dual-use goods with military applications via third-party countries.
More than 80% of Russia's purchases of "high-priority items" are coming from China and Hong Kong, Bloomberg said.
Exports from countries like Kazakhstan, Serbia, Turkey, Armenia, Azerbaijan, and Uzbekistan fell in the second half of 2023 but remain mostly higher than pre-war levels, according to the news outlet.