World ECR | G7 releases first joint guidance on Russia

The U.S. State Department announced on September 24 that the Group of Seven (G7) countries had issued the first-ever joint industry guidance aimed at “preventing the evasion of export controls and sanctions imposed on Russia.”

The updated guidance outlines the following priority areas:

• Items with a higher risk of being transferred to Russia;
• Red flag indicators of potential export controls and/or sanctions evasion; and
• Industry best practices for addressing these red flags and enhancing due diligence.

The goal of the guidance is to protect common high-priority list items from misappropriation, prevent reputational damage and mitigate liability risks, while supporting the continued success of coordinated export controls and sanctions, the BIS said in a press release.

The guidance provides industry with strategies for identifying and mitigating risks associated with export control violations. It emphasizes the importance of due diligence and a strong compliance program to detect and prevent illegal activity.

BIS said it “encourages industries to implement enhanced screening processes and improve information sharing among G7 members.”

This guidance document includes:

1. List of items with a higher risk of being transferred to Russia,

2. Updated red flag indicators of potential export controls and/or sanctions evasion,

3. Industry best practices for addressing these red flags, and

4. Screening tools and resources to assist with due diligence.

Highlights include the use of advanced technology to track and trace shipments, continuous monitoring and reporting of suspicious activity to the appropriate authorities.

The BIS said in its press release that the guidance is an important tool for industries to ensure they do not inadvertently evade export controls and sanctions.

Matthew Axelrod, assistant secretary for export enforcement at the U.S. Department of Commerce, said “the top priority for G7 members is to prevent Russia from obtaining the parts and components it needs for its deadly missiles and drones.” He said: “However, the G7’s counter-diversion efforts cannot succeed without the cooperation of industry, which is why today we are publishing the first-ever guidance document designed to provide G7 industry with Information needed to identify and respond to Russia’s evolving evasion tactics.”