20th Sanctions Package Overcomes Orbán Hurdle – EU Steps Up Anti-Circumvention Measures Against Russia

After protracted negotiations and nearly two months of political stalemate, the Council of the European Union ("EU") adopted the 20th sanctions package against Russia on 23 April 2026. The package, which the Commission had already presented on 6 February 2026, was originally intended to enter into force on 24 February 2026, the fourth anniversary of Russia's war of aggression against Ukraine. Adoption initially failed due to the unanimity requirement in the Council, as a result of repeated vetoes by Hungary and Slovakia in connection with the dispute over the repair and recommissioning of the Druzhba oil pipeline through Ukraine. Only after completion of the repairs and the clearance of oil transit was the path cleared both for the EUR 90 billion EU loan to Ukraine and for the new sanctions package. With this package, the Union aims to further restrict Russiaís economic and financial wiggle room and to close loopholes enabling circumvention. In particular, the package targets Russiaís energy revenues, shadow fleet structures, financial and crypto services, and third-country actors involved in sanctions circumvention, thereby increasing pressure on Russia to engage in serious negotiations.

This newsletter highlights the key new measures:

1. Expansion of goods-related sanctions

By extending Annexes VII and XXIII of Regulation (EU) No. 833/2014 ("Regulation 833/2014"), additional goods have been made subject to export restrictions pursuant to Articles 2a and 3k of Regulation 833/2014. The goods newly included in Annex XXIII notably comprise: chemical intermediates (CN codes 2931, ex 2932), explosive-related products (CN code 3603), natural and synthetic rubber and rubber products (CN codes 4001, 4007, ex 4015, 4016, 4017), industrial abrasives (CN code 6805), metal fasteners and cast articles (CN codes 7318, 7325), tool components made of cermets (CN code 8209), welding and build-up materials of metals (CN code 8311), and certain high-performance tractors (CN code 8701 95 90). An old-contract (grandfathering) clause applies until 25 July 2026 for the performance of contracts concluded before 24 April 2026. In addition, Annex VIIA has been expanded to include additional energetic materials, certain lubricants, fluids and additives, and Annex VIIB has been extended to cover specific glassware (CN code 7017); no grandfathering clause applies to these additions.

Furthermore, by extending Annex XXI, the package introduces new import bans on goods from Russia, in particular mineral raw materials, chemicals, metals and semi-finished metal products.

2. New restrictions on services

The service-related restrictions under Article 5n(1) of Regulation 833/2014 have been expanded to include "managed security services." A "managed security service" means a service provided for a third party that consists of, or supports, activities related to cybersecurity risk management, such as incident response, penetration testing, security audits and consultancy - including expert consultancy - for technical support. The prohibition applies from 25 May 2026. General Licence No. 42 issued by the German Federal Office for Economic Affairs and Export Control (BAFA), which generally authorises certain services otherwise restricted under Article 5n for residents, does not currently extend to the newly listed ìmanaged security servicesî.

3. Expansion of personal sanctions

37 individuals and 80 entities have been newly added to Annex I of Regulation (EU) No. 269/2014. A comprehensive asset freeze and prohibition on making funds or economic resources available applies to the listed persons, organisations and entities. Most of them are actors from the military sector and the defence industry. In addition, 60 further companies, many of which are established outside Russia, have been added to Annex IV of Regulation 833/2014. No dual?use goods or goods listed in Annex VII of Regulation 833/2014 may be supplied to companies listed in Annex IV.

4. Combating sanctions circumvention

A key focus of the 20th sanctions package is the fight against circumvention practices. For the first time, the EU anti-circumvention instrument pursuant to Article 12f of Regulation 833/2014 is actively applied by populating Annex XXXIII. The sale, supply, provision and export of militarily sensitive goods under CN codes 8457 10 (machining centres for working metal) and 8517 62 (apparatus for the reception, conversion, transmission and regeneration of voice, images or other data) to the Kyrgyz Republic are now prohibited. This follows the Unionís finding of a significant increase in corresponding trade flows from the EU via Kyrgyzstan to Russia since the entry into force of the Russia sanctions, indicating systematic circumvention. Moreover, additional third-country companies have been made subject to transaction bans due to their involvement in sanctions circumvention. For the first time, a transaction ban has also been imposed on a port and a lock in Indonesia (Karim oil terminal).

5. Extended financial and crypto restrictions

The sanctions package expands transaction bans to additional credit and financial institutions, in particular those based in third countries, and further tightens restrictive measures in the crypto sector by expanding the range of crypto-assets blocked for transactions.

6. Oil and gas sector

The package introduces additional restrictions in the Russian oil and gas sector. The import restrictions under Article 3m of Regulation 833/2014 are extended to cover natural gas condensates under CN subheading 2709 00 10, and the restrictions pursuant to Article 3q relating to the sale of tankers are broadened. New service prohibitions relating to LNG tankers and icebreakers are laid down in Article 3sa of Regulation 833/2014, and additional vessels identified as part of the Russian "shadow fleet" are made subject to the restrictions under Article 3s of Regulation 833/2014.

7. Extension of the No-Claims-Clause

The No-Claims-Clause under Article 11(1) of Regulation 833/2014 is extended to the satisfaction of claims by natural persons of a third country who are not Russian nationals, and by legal persons, organisations or entities established in a third country other than Russia - with the exception of the partner countries listed in Annex VIII of Regulation 833/2014.

8. Outlook

The 20th sanctions package was formally adopted by the Council of the European Union on 23 April 2026. The corresponding amending regulations to Regulation (EU) No. 833/2014 and Regulation (EU) No. 269/2014 entered into force on 24 April 2026. Certain measures apply only at a later date, and grandfathering clauses apply. In parallel, the Council has adopted a substantively corresponding sanctions package against Belarus, which is also expected to enter into force shortly.