Refer to Related Case Documents: E.O. 14066, E.O. 14071 (“Prohibitions on Certain Services as They Relate to the Maritime Transport of Crude Oil of Russian Federation Origin”) (the “crude oil determination”, “Prohibitions on Certain Services as They Relate to the Maritime Transport of Petroleum Products of Russian Federation Origin”, the “petroleum products determination”); General License 55A Authorizing Certain Services Related to Sakhalin-2; General License 56A, Authorizing Certain Services with Respect to the European Union; Council Decision 2014/512/CFSP; Regulation (EU) No 833/2014; Decision (CFSP) 2022/884.
Case Background
The client is Company [Confidential], registered in India, engaged in trading oil and petroleum products, including to European Union countries such as Germany, the Netherlands, and Italy. The request was to obtain a Legal Opinion on the compliance of their oil export operations to continue business activities under the new sanctions and to present it to regulatory authorities in the event of inspections or investigations, confirming the legality of the client’s actions.
Legal Assistance Provided
Our lawyers conducted a detailed analysis of the Price Cap Policy for Crude Oil of Russian Federation Origin and reviewed the activities of Company [Confidential] It was established that Company [Confidential] provides services related to the maritime transport of Russian oil and Russian petroleum products.
There are no shipments to the USA, which fully complies with E.O. 14066 (The import of Russian crude oil; petroleum; petroleum fuels, oils, and products of their distillation; liquefied natural gas; coal; and coal products into the United States is prohibited pursuant to E.O. 14066).
Due to the sanctions regime against Russia and the imposed price cap on Russian oil exports, any commercial activity related to the export of Russian oil requires strict adherence to the established restrictions.
Our lawyers confirmed that Company [Confidential] is allowed to conduct maritime transportation of oil as long as the price of oil or petroleum products does not exceed the established price cap in accordance with sections l(a)(ii), l(b), and 5 of E.O. 14071 (the price cap on Discount to Crude petroleum products of Russian Federation origin shall be $45 per barrel, and the price cap on Premium to Crude petroleum products of Russian Federation origin shall be $100 per barrel). These conditions were also adhered to for other services such as trading, financing, shipping, insurance, vessel registration, and customs clearance.
To ensure compliance, it was recommended that Company [Confidential] collect and retain documents proving adherence to price restrictions, such as invoices and contracts, as well as requests and attestations from clients confirming compliance with the established requirements.
Company [Confidential] was informed and understands that violating these requirements could result in sanctions and penalties from OFAC (except in cases of good faith compliance with safe harbor procedures (31 CFR § 501.601), which protect against liability for unintentional violations).
Our lawyers provided a comprehensive and detailed Legal Opinion on Compliance with Russian Oil Price Cap for Company [Confidential], substantiating the compliance of operations with the established requirements, describing in detail the export operations and mechanisms for adhering to the price cap on Russian oil. An integral part of the Legal Opinion included:
- Evidence of no connections with sanctioned persons and organizations
- A new monitoring and control plan to ensure price cap compliance at every stage of the supply chain
- Other documents and legal strategies, not disclosed to prevent competitive advantage
This ultimately expanded the trading opportunities, ensuring the safe and legal business activities of our client in compliance with OFAC requirements regarding the Price Cap for Crude Oil and Petroleum Products of Russian Federation Origin (G7).
Attention: Any information that could identify the client may have been intentionally altered or concealed. This includes, but is not limited to, the use of pseudonyms, generic terms such as “Client [Confidential]”, changes in job titles, E.O., company names, banking structures, and other data anonymization techniques. These changes and measures are solely aimed at ensuring client confidentiality and do not affect the legal substance and validity of the arguments and claims presented in the documents.
