Export to Russia Breaking news! The United States has recently imposed sanctions on VTB Bank Shanghai Branch!

But according to the latest news, on June 12, 2024, local time in the United States, the U.S. State Department and the Treasury Department OFAC issued an announcement to impose sanctions on more than 300 individuals and entities, involving overseas branches of Russian financial institutions, including VTB Shanghai and VTB Hong Kong.

Last December, Biden signed an executive order giving the U.S. Treasury the power to impose secondary sanctions on foreign financial institutions if it is found that foreign financial institutions act for or on behalf of any of the approximately 1,200 entities that the U.S. government considers to be Russian defense departments.

Because of this executive order, banks in third countries will be reluctant to deal with high-risk Russian customers. This is actually a significant expansion of the secondary sanctions plan against Russia. About 2/3 of the new sanctions list this time are entities, including companies related to information technology and aviation, vehicle manufacturers and machine manufacturers, etc., to prevent foreign companies from assisting Russia in circumventing Western sanctions.

After several rounds of sanctions, the number of sanctioned entities in Russia has increased to more than 4,500. It is worth noting that according to the executive order, anyone included in the SDN list may be subject to additional export restrictions imposed by the Bureau of Industry and Security (BIS) of the U.S. Department of Commerce.

According to feedback from foreign traders, the recent transfer of funds from VTB Shanghai to ICBC in China has not been affected. However, once the sanctions are issued, it will actually block the business transactions between Chinese banks and VTB. "There is no problem with using VTB to collect foreign exchange because it does not go through the SWIFT system, but now we are worried that the received payment cannot be transferred to domestic banks." This is what foreign traders are currently worried about. Foreign traders exporting to Russia must pay attention to changes and keep an eye on progress.

Moscow Exchange issues announcement to counter US! No more US dollars or euros!

On the evening of June 12, local time, the Moscow Exchange issued an announcement stating that due to the sanctions, the exchange will no longer use the US dollar and the euro for foreign exchange and precious metal transactions from June 13. In addition, financial instruments settled in US dollars and euros will no longer be traded in the stock market, money market and standardized derivative financial instrument market.

The announcement stated that forward market transactions will not be affected and will be traded according to previous rules.

The Russian Central Bank issued an announcement on the same day stating that over-the-counter transactions in US dollars and euros will not be affected and can proceed as usual. The central bank will use bank statements and information from over-the-counter trading platforms to determine the official exchange rate of the US dollar and the euro against the ruble.

The Russian Central Bank emphasized that companies and individuals can continue to buy and sell US dollars and euros through various banks in Russia, and the US dollar and euro funds in personal and corporate accounts and deposits are safe.

The US Treasury Department announced a new package of sanctions against Russia on the 12th, targeting institutions that make up the Russian financial system and the "transnational network" that provides raw materials to Russian gold producers to support Russian weapons manufacturing. Among them, the Moscow Stock Exchange and its subordinate National Settlement and Depository Company and the National Clearing Center are on the list of sanctions.

In response to the latest U.S. sanctions, Russian Ambassador to the U.S. Anatoly Antonov said on the same day: "We will not force ourselves to become a partner of the United States. If the Americans are ready, Russia is willing to engage in honest and equal dialogue. However, we will also respond fully and decisively to the confrontation imposed on us."