EU sanctions package on Russia stalls due to German opposition

According to Deutsche Presse-Agentur, Berlin is pushing to either limit the responsibility of subsidiaries to certain goods or remove them entirely from the package.

The European Union’s attempt to implement a new round of sanctions against Russia has hit a roadblock, according to reports from Reuters citing EU diplomats. The proposed package, which was set to be discussed, was unexpectedly removed from the meeting agenda at the last moment due to Germany’s opposition.

The sanctions package aimed to further tighten restrictions on Russia, including a ban on the transit of Russian liquefied natural gas and measures to combat sanctions evasion. A key point of contention was a plan to hold EU operators liable for violations by their subsidiaries and partners in third countries.

Germany’s resistance stems from concerns that the proposed regulations could negatively impact German companies. According to Deutsche Presse-Agentur, Berlin is pushing to either limit the responsibility of subsidiaries to certain goods or remove them entirely from the package.

This setback comes at a crucial time, as EU members had hoped to approve the sanctions ahead of the Ukraine peace conference scheduled for June 15-16 in Switzerland. The conference is expected to draw delegates from around 90 countries, although notable absentees include Russia, China, and Saudi Arabia. Moscow has criticized the event, suggesting that Western powers would use it to dictate an ultimatum.

The EU has already imposed significant sanctions on Russia, with over 2,100 entities and individuals currently blacklisted in response to Russia’s military operations in Ukraine. In contrast, the United States proceeded with a new round of restrictions this week, targeting the Moscow Stock Exchange (MOEX), major banks, and Russia’s IT sector.

The impact of these sanctions was felt immediately, with MOEX suspending trading in US dollars and euros on Thursday. However, Kremlin spokesman Dmitry Peskov expressed confidence in the Russian central bank’s ability to ensure the stability of all markets.

This impasse in the EU’s sanctions policy highlights the complex balancing act between applying pressure on Russia and protecting domestic economic interests. It also underscores the challenges of maintaining a unified approach within the bloc on issues related to the ongoing conflict in Ukraine.

As negotiations continue, the international community will be watching closely to see if the EU can overcome this hurdle and move forward with its planned sanctions, or if further compromises will be necessary to achieve consensus among member states.