Financial Sanctions

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Energy Lessons from the Ukraine Crisis

It is a cliché that wars are fought over energy access.  It is just as trite to point out the illegality of military action to secure energy resources for oneself or to deny energy access to adversaries.  As sanctions against Russia and against Ukrainian separatist regions come into focus, energy access again comes front and center.  Germany’s halt to the certification of the Nord Stream 2 pipeline is perhaps emblematic in this respect.  It attempts to strike at Russian interests by means of limiting energy revenue.  That being said, as has been pointed out, halting Nord Stream 2 does little to stop gas flows through Nord Stream 1 – Germany thus continues to take gas from Russia even as it hopes to sanction Russia by potentially stranding $11 billion in investments in the Nord Stream 2 project. Much will be written about what sanctions to use, if sanctions are an appropriate foreign policy tool, and whether they are at all effective at curbing behavior.  Suffice it to say that if the vision…

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Secondary Sanctions: A Weapon out of Control? Part III: Looking beyond the WTO – possible avenues to raise a Judicial Challenge against Secondary Sanctions

Judicial remedies at the domestic and international level In our two previous posts we examined the legality of secondary sanctions in light of customary law on the exercise of State jurisdiction, on the one end (here), and conventional law, specifically the IMF Articles of Agreement, on the other hand (here). Having established that, depending…

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Secondary Sanctions: A Weapon Out of Control? Part II: The legality of secondary sanctions under conventional law and the IMF’s tacit approval procedure for payment restrictions inspired by security concerns

The legality of so-called ‘non-UN’ or ‘autonomous’ sanctions has been amply debated in recent years. Discussion has arisen, for instance, on their compliance with the principle of non-intervention (see here), or their potential qualification as ‘third-party countermeasures’ (see e.g. here and here). The legal challenges are further compounded when…

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Secondary Sanctions: A Weapon Out of Control? Part I: Permissibility of the sanctions under the law of jurisdiction

Lately, the US has increasingly been ‘weaponizing’ economic sanctions to push through a foreign policy agenda. Making use of the centrality of the US in the global economy, it has forced foreign states and their firms to choose between halting trade with US sanctions targets or forfeiting access to the lucrative US market. In addition, the US…

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UK Extraterritorial Financial Sanctions: Too Much, Too Little, Too Late?

The US practice of the extraterritorial application of sanctions was criticised for years as, at best, the illegitimate abuse of its particular position in the world’s economy. Despite its fully comparable position in international finance, the United Kingdom was shielded from such criticism predominantly thanks to the transfer of respective decision-making to Brussels. The nature and scope of…

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