On 23 July 2026, the Council of the European Union adopted a regulation amending the EU's Ukraine-related restrictive measures (Regulation (EU) No 269/2014), introducing new derogations, exemptions, and legal remedies for EU operators. The amendments allow competent authorities to authorise the release of frozen funds for insurance indemnities due by listed entities to recipients in the EU, EEA, Switzerland, or partner countries, and permit share transfers or fund releases for put options contractually agreed before 28 February 2022 involving certain listed individuals. The regulation also exempts from asset freezes funds necessary for rail transport by JSC Russian Railways and for the Paks II civil nuclear project in Hungary, while extending the right of EU operators to recover damages from claimants in third-country courts and requiring Member States not to recognise Russian court decisions related to contracts affected by the sanctions.
The document, a legislative act adopted by the Council, updates the 2014 sanctions framework in response to ongoing challenges in enforcement and legal certainty for EU businesses. The new derogations address specific cases: Article 6b(5ea) permits payments for insurance indemnities for materialised risks, while Article 6b(5l) allows transfers related to put options involving individuals listed under entries 674 and 675, provided the resulting shares are frozen and the credit institution is not listed. The exemption for JSC Russian Railways (Article 6g) covers rail transport between Russia and the Union, transit through the Union, between Kaliningrad Oblast and Russia, or within Russia, including related services. The Paks II exemption (Article 6h) applies to entities listed under entries 975, 976, and 977, with Hungary required to notify other Member States and the Commission within two weeks of any activity.
The amendments balance tightening enforcement with providing legal certainty for EU operators. The non-recognition of Russian court decisions (Article 11c) blocks the effect of Russian injunctions under its Arbitration Procedure Code, protecting EU companies from retaliatory litigation. The extended right to recover damages (Article 11a) allows listed persons to seek compensation from claimants in third-country courts if they lack effective access to remedies. However, the exemptions for rail transport and Paks II create potential loopholes, as they allow continued economic activity with sanctioned entities in strategic sectors. The Commission is tasked with monitoring undue benefits that may arise from the measures and proposing remedies.
EU businesses involved in rail transport or the Paks II project benefit from continued operations without asset freeze risks, while insurance companies and financial institutions gain clarity on permissible payments for pre-existing contracts. Sanctioned entities, such as JSC Russian Railways and the Paks II contractors, receive targeted relief, potentially undermining the sanctions' pressure on Russia. EU operators facing litigation in Russian courts gain a legal shield, but the non-recognition clause may provoke further legal disputes in third-country jurisdictions. National competent authorities face increased administrative burden in assessing derogation requests and monitoring compliance.
The regulation enters into force on the day following its publication in the Official Journal. Member States must implement the new rules, and the Commission will assess cases of undue benefits and propose further amendments if necessary. The European Parliament is not directly involved in this Council-only legislative act, but may scrutinise implementation through its committees.