Trade Compliance

GHY discusses changes to international trade regulations and explores cutting-edge compliance strategies.

Russian Trade Sanctions Against Western Countries

Posted August 12, 2014

Retaliating to the escalating sanctions against Russia’s banking and energy sector imposed by the West over the confrontation in Ukraine, on August 6, Russian President Vladimir Putin signed a decree limiting the import of agricultural, raw and food products from the United States, the European Union and other countries. The following day, Russian Prime Minister Dmitri Medvedev announced that Russia would ban all beef, pork, fish, fruit, vegetables and dairy products from the EU, the U.S., Canada, Australia and Norway for a period of one year.
Russian Eagle
The specific categories of items whose import has been banned are: Beef; pork; poultry (chicken, duck, goose, turkey, guinea fowl); salted meat, meat in brine, dried meat and smoked meat; fish, crustaceans and other marine/freshwater invertebrates; milk and dairy products; vegetables, edible root vegetables and other tubers; fruit and nuts; sausages and analogous meat products, meat or blood sub-products, processed food products based on them; processed products, including cheese and curd with vegetable fat base; and food products containing dairy and vegetable fats.

The Russian measures do not contain any “grandfathering” provision allowing for the performance of pre-existing obligations and were introduced with immediate effect in relation to all affected imports. Canadian and U.S. exporters will therefore need to identify whether performance of their contractual obligations remains possible in view of the new measures. According to the Canadian Meat Council, up to $50 million in frozen pork products may already have been in transit to Russia when the new ban was imposed.

Agriculture and Agri-Food Canada, in collaboration with the Canadian Food Inspection Agency and other federal government departments is currently assessing the impact of the embargo on Canadian agricultural and seafood exports to Russia. Canada’s agricultural exports to Russia amount to more than $500 million annually. It is the fourth largest market for Canadian pork and sold about $260 million of product there last year. Russia is also the second largest export market for U.S. chicken. Last year, America exported roughly 267,000 metric tons of chicken, worth about $309 million.