Industries dealing with dual-use goods and advanced technology are especially urged to scrutinize supply chains. Compliance teams should integrate these guidelines into their risk management frameworks to ensure adherence to export controls and sanctions.
The G7 guidance addresses actions to prevent Russian sanctions evasion through deceptive tactics like transshipment and diversion of controlled goods. It includes:
- High-Risk Items:
A Common High Priority List (CHPL) details goods Russia seeks for military use, such as microelectronics and CNC machines.
- Red Flag Indicators:
Signs of sanctions evasion, including sudden changes in trade activity and misclassification of goods.
- Best Practices:
Enhanced due diligence, customer verification, and updating compliance systems to prevent inadvertent aid to Russian evasion efforts.
The guidance affects all parties in the supply chain, from exporters to logistics companies. Those involved in dual-use goods and technology (with both civil and military applications) are particularly at risk. Action steps for such companies are as follows:
- Implement Due Diligence: Screen all parties against sanctions lists, verify the end-users, and conduct regular checks on customers, especially in high-risk regions.
- Monitor for Red Flags: Pay close attention to sudden trade pattern shifts, suspicious transactions, or incomplete documentation.
- Update Compliance Systems: Ensure your organization is up-to-date on regulations and that staff are trained to detect potential sanctions evasion.
Solstico Legal is prepared to assist clients with these steps, as well as with ongoing legal support to navigate the complex web of export controls and sanctions keeping your business compliant and protected.