Five-step sanctions compliance model

Complying with sanctions requires more than just checking a list of restricted companies. We have developed a five-step sanctions compliance model to help you measure your sanction-related risk and protect your business from illegal engagements with sanctioned companies or individuals.

We recommend starting with screening and deciding on the following action based on the findings.

Step 1: Self-diagnostics

1. Does your company have links with entities directly or indirectly owned by individuals or entities with ties to Russia and Belarus?
2. Do any individual investors in your company have ties to Russia or Belarus?
3. Does your company have any employees, assets or operations in Russia or Belarus?
4. Does your company export or provide goods or services to Russia, Belarus or the Russian-occupied territories?
5. Does your company sell goods subject to the export controls introduced by the new sanctions (sensitive technologies including semiconductors, telecommunication, lasers, sensors, navigation, avionics, maritime technologies, dual-use goods, machinery, etc.)?
6. Does your company buy goods subject to import controls (wood, cement, rubber, potash, etc)?
7. Does your company have plans to expand operations or attract customers in Russia or Belarus?
8. Does your company have dealings with contractors, re-sellers, agents, suppliers, developers or other third parties with ties to Russia or Belarus?

If you answered “yes” to at least one of those questions, we suggest you carry out an assessment of your company’s compliance with sanctions regulations and business partner screening.

We invite you to read about the next steps or contact our Sanctions compliance team.

Step 2: Screening

We can offer fast checks of your contracting parties, using official databases and our partners’ software. Screening results will identify the names of any of your cooperation partners which are already sanctioned (by the EU or some other countries/regions) or which might be subject to sanctions, and which consequently require extra attention.

For service provision, the client has to submit a list of legal entities that need to be checked. The outcome of this is a simple report with the screening results “passed” or “red flags” – the latter meaning that further investigation is required. Screening starts and ends with an advisory discussion with our senior experts, in order to scope out and understand the findings.

Step 3: Investigation and risk identification

If in the previous step “red flags” have been identified, we offer as a further step deeper investigation and analysis for each of the relevant companies – we will provide information on the group/ownership structure, a list of management board/supervisory board/CEO, and an indication of UBO if available, etc.

Investigation and risk identification may also extend to sectoral and territorial restrictions. Depending on the company’s business, we may also assess whether other sanctions apply.

The outcome of the process is a report with recommendations on how to act.

Step 4: Consultation on findings and implementation

Our lawyers will provide individual consultation based on the issues identified in the previous phases. We will help your business to understand what to do next – how to continue with or terminate a contract and what additional requirements the company needs to follow if cooperation is continued with Russian or Belarusian companies that are not sanctioned.

Step 5: Policy and procedure set-up

To enable continuous sanctions management at your company, we can offer to draft a policy that will help you to proactively identify and manage sanctions-related risks, including contract template adjustments, a procedure for sanctions identification, procedural checklists, etc.

We can either assist you with individual steps or offer a full five-step package.