Navigating Russia Sanctions: Strategies for Companies to Mitigate Supply Chain Risks
Summary
Virtually every industry is impacted, and Russia’s financial institutions, businesses and prominent individuals are being targeted by ever-widening sanctions and export control restrictions imposed by the United States and global allies. There has also been an increased risk of non-U.S. made items now requiring a license for export to Russia or Belarus due to the expanded FDP rules. Practical Recommendations: Red Flags and Know Your Customer Guidance Export control and sanctions regulators expect companies to conduct thorough risk-based due diligence prior to dealing with counterparties. Thus, companies should ensure they are conducting proper due diligence on all third parties involved in their supply chains—e.g., customers, suppliers, vendors, commercial partners, contractors and employees—to address and mitigate risks. Submitting a VSD is considered a mitigating factor, and, according to BIS, is an excellent indicator of a party’s intent to comply with U.S. export control requirements.