Swiss sanctions against Russia – Further alignment with the EU – Implementation of the 16th Sanctions Package

1. Introduction

On 14 May 2025, the Swiss Federal Council adopted further sanctions against Russia with a view to mirroring the latest measures imposed by the EU on 24 February 2025. The corresponding amendments to the Ordinance on measures in connection with the situation in Ukraine ("UKRO") entered into force on 15 May 2025.

The Swiss State Secretariat for Economic Affairs ("SECO") simultaneously updated its FAQ guidance to clarify the scope and application of the new and amended provisions, notably to reflect the scope, application and enforcement of the newly adopted Article 24d UKRO.

Redline comparisons and English translations of the UKRO and FAQ are available as follows:

• UKRO (as of 15 May 2025 and a redline against the version of 13 February 2024): here and here, respectively.
• SECO FAQ (as of 15 May 2025 and a redline against the version of 6 February 2025): here and here, respectively.

2. Key elements

The newly adopted amendments intensify existing restrictions, particularly in relation to dual-use goods, software in the energy sector, designated territories and retaliatory proceedings. The following highlights some of the most relevant amendments introduced, notably in relation to service prohibitions, infrastructure restrictions and legal protections:

1. Extension of the territorial scope of the service bans (28e UKRO)

Article 28e UKRO, which already prohibited the provision of certain professional and business services to Russian entities, has been extended to cover service recipients located in the territories listed in Annex 6:

• Crimea and Sevastopol;
• Non-government-controlled areas of Donetsk, Luhansk, Kherson and Zaporizhzhia.

Further, the following service categories were newly added to the list of prohibited services under Article 28e UKRO:

• Construction services (added to paragraph 1bis);
• Accounting services: prohibited in addition to bookkeeping and audit (new paragraph 1sexies);
• Transfers of intellectual property rights or trade secrets, including licensing, access or reuse rights enabling the development, use or manufacture of restricted software (new paragraph 1septies).

The prohibitions apply to both direct and indirect provision of the listed services and software.

There are specific exemptions and derogations, such as for humanitarian activities, certain civil society activities, diplomatic/consular functions, and critical infrastructure, as well as for entities in Russia that are exclusively or jointly controlled by Swiss, EEA or partner country entities.

In this context, Article 28e UKRO provides for reporting obligations. While the reporting obligation under Article 28e (6)–(7) UKRO was introduced prior to this territorial extension (with an initial deadline of 31 July 2024), the scope of the obligation implicitly covers services made available in Annex 6 territories if such services are rendered under an exemption. In the absence of explicit transitional provisions, it is advisable for entities to:

• Treat services to Annex 6 territories after 15 May 2025 as falling under the semi-annual reporting cycle;
• Ensure disclosures specify the geographical link to the non-government-controlled area.

2. Restrictions on Russian infrastructure involvement (Article 24d UKRO; Annex 15c)

A new provision, Article 24d UKRO, introduces a broad prohibition on transactions involving certain Russian ports, locks and airports, as listed in new Annex 15c.

The prohibition is particularly relevant for entities involved in shipping, trade finance, infrastructure financing and logistics operations.

Article 24d (2) and (3) UKRO provide a closed list of exemptions. These include, notably the following:

• Transport of crude oil or refined petroleum products of non-Russian origin and ownership;
• Shipments of essential goods (e.g. pharmaceuticals, food, aluminium, gas);
• Activities in response to maritime emergencies or urgent health/safety needs.

Where a transaction falls under one of the exemptions, Swiss operators are required to inform SECO within two weeks of its conclusion (Article 24d (4) UKRO).

3. Reinforcement of SWIFT prohibitions and anti-circumvention (Article 27a UKRO)

Article 27 UKRO (pre-existing) prohibits the provision of specialized financial messaging services, in particular SWIFT, to banks, companies or entities listed in Annex 14 UKRO, as well as to any bank, company or entity established in the Russian Federation that is more than 50% controlled by entities listed in Annex 14. This measure targets the ability of designated Russian financial institutions to access international financial messaging infrastructure, thereby restricting their participation in global financial markets.

New Article 27a UKRO introduces a direct prohibition on connecting to the financial messaging system of the Central Bank of the Russian Federation or to any equivalent specialized financial messaging services established by the Russian Central Bank. This prohibition is designed to prevent circumvention of the SWIFT ban by blocking access to alternative Russian systems.

Additionally, Article 27a (2) UKRO prohibits participation in any transaction with banks, companies or entities listed in Annex 14a UKRO. This broadens the scope of the restriction to include not only the use of messaging systems but also any transactional engagement with entities designated in Annex 14a UKRO.

The prohibitions do not apply to the receipt of payments due by entities designated in Annex 14a UKRO under contracts executed before 24 March 2024. SECO may also grant derogations for the repayment of export credits or for the execution of contracts concluded before 15 May 2025, provided the beneficiaries are based in Switzerland or an EEA state, and in any event, only until 26 August 2025.

4. Extended right to damages and procedural protection (Article 30f UKRO)

The revised Article 30f UKRO consolidates and expands the legal protections available to Swiss parties subject to retaliatory proceedings abroad. In particular, the updated version introduces:

• Explicit standing for Swiss entities to claim damages not only for direct harm (Article 30f (1) and (2) UKRO) but also for harm suffered by entities they control (Article 30f (2bis) UKRO);
• Expanded scope of liability to include both sanctioned parties and entities exercising control over them (Article 30f (2ter) UKRO);
• A new jurisdictional fallback clause (Article 30f (2quater) UKRO), enabling Swiss courts to assert jurisdiction in the absence of another available forum, provided a sufficient link to Switzerland exists (forum necessitatis).

In addition, Swiss courts remain barred from recognizing or enforcing Russian judgments based on retaliatory legislation, particularly decisions linked to decree No. 302 of the President of the Russian Federation or its equivalents. The safeguards under Article 30f URKO constitute a procedural shield for Swiss individuals and companies complying with sanctions.

3. Reporting obligations – Reminder of key deadlines

[1]     Official SECO templates are published here.

4. Due diligence – Reminder for financial institutions

Financial institutions should remain particularly vigilant to the risk of indirectly facilitating restricted transactions through providing financial services or financing. Indeed, in addition to prohibiting specific commercial activities, Swiss sanctions also restrict the financing of such activities, including the provision of loans, credit facilities, leasing, guarantees and insurance when linked to transactions involving sanctioned entities or sectors, as well as financial services more generally in certain specific cases.

This is particularly relevant when dealing with counterparties in jurisdictions considered to be "friendly" under Russian legislation, where there is an increased risk of sanctions circumvention. Financial institutions should ensure that financial services they provide do not indirectly support transactions that ultimately fall under Swiss sanctions prohibitions.

A notable risk area is the crude oil sector, where transactions involving vessel leasing, shipping or crude oil trading require enhanced due diligence. If a financial institution provides financial services – including payments processing or treasury management – to a client involved in vessel chartering, for example, where vessels may be used to transport Russian crude oil, the financial institution should verify that such financial services do not indirectly facilitate transactions that breach price cap regulations.

The recently introduced prohibition on transactions with Russian high-risk infrastructure (Article 24d UKRO) will require enhanced diligence efforts on transactions with potentially relevant touchpoints to assess compliance with the ban, applicable exemptions, and, as the case may be, notification obligations.

To manage such risks effectively, financial institutions should consider implementing a comprehensive risk management approach, including:

• Enhanced due diligence procedures, ensuring verification of counterparties, beneficial owners and end-users, respectively destination of restricted goods (e.g., oil, luxury goods, etc.) to assess potential exposure to sanctioned transactions.
• Explicit contractual representations and warranties, requiring clients to certify compliance with applicable sanctions regimes, respectively certifications that certain goods will not be sourced from or delivered to Russia or other restricted regions.
• Continuous monitoring of payment flows and transaction structures, particularly in cases where financial services are provided to clients operating in high-risk jurisdictions or where there are indications of re-export or indirect trade financing.
• Internal escalation procedures, ensuring that potential red flags – such as complex trade routes, non-transparent payment structures or counterparties with previous sanctions exposure – are promptly reviewed by compliance teams.

Given the evolving regulatory landscape, financial institutions should regularly review and strengthen their internal risk management frameworks to ensure full compliance with Swiss and international sanctions.

5. Institutional cooperation – OFAC - SECO Memorandum

On 9 May 2025, the SECO and the U.S. Office of Foreign Assets Control ("OFAC") signed a memorandum of understanding ("MOU") setting out their intention to strengthen cooperation in the enforcement of sanctions (available here).

Although not legally binding, the MOU establishes a framework for information sharing and coordination between Swiss and U.S. sanctions enforcement authorities. While it does not create new rights or obligations under Swiss law, the MOU underscores the importance of proactively addressing potential dual-jurisdiction exposure within compliance frameworks.

6. Future developments

Sanctions are amended and adapted on an ongoing basis. Given the importance of the topic and the potentially serious legal and reputational consequences of a breach, it is essential to keep abreast of the latest measures and any guidance issued by the Swiss government. We are monitoring these developments closely.

At this juncture, the introduced restrictions raise a number of interpretation and implementation questions. Some of those questions are expected to be clarified based on EU sanctions guidance and FAQs, if any, whereas other issues will require formal confirmation from SECO. We are working with our clients to clarify the expectations of competent authorities and to find practical solutions for an efficient operational implementation of the sanctions framework.

7. Useful links

Given the fluid nature of the sanctions, we enclose some relevant resources which we trust will be of assistance for monitoring the developments:

​​​​​​​7.1 Swiss Sanctions

UKRO, as of 15 May 2025

• Official publication:
  • UKRO German version
  • UKRO French version
  • Unofficial English translation​​​​​​​
  • Redline against the version of 13 February 2024 (English)

SECO FAQ, as amended on 15 May 2025

• Official publication:
  • German version
  • French version
  • Unofficial English translation
  • Redline against the version of 6 February 2025 (English)

7.2 EU Sanctions

• Consolidated texts of sanctions regulations
  • Consolidated text of Regulation (EU) No 833/2014 (Russia)
  • Consolidated text of Regulation (EU) No 269/2014 (Ukraine territorial integrity)
• Compilation of frequently asked questions regarding EU sanctions available here: link.

Please do not hesitate to contact us in case of any questions.

You may reach out to your usual contact at our firm or direct any sanction-specific queries to our dedicated task force at sanctions@lenzstaehelin.com.