Will the UK follow the EU’s 21st Russia sanctions package?

Summary

The European Commission announced the EU's 21st Russia sanctions package on 9th June 2026, proposing transaction bans on 35 banks and 11 crypto platforms, a first-ever import ban on Russian fish, and a freeze of the oil price cap at $44.10 per barrel. As of 19th June 2026, the package has not been formally adopted; EU member states must vote unanimously before any measure enters EU law. Importantly, even if the sanctions package is adopted, the UK is under no legal obligation to implement or copy it. The gap between the EU proposal and UK designation exposes clients whose payment routes pass through correspondent banks in Kazakhstan, Kyrgyzstan, or the Gulf.

• The EU's 21st sanctions package was proposed on 9th June 2026 and, as of 19th June 2026, has not been formally adopted; EU leaders have called for swift adoption, with individual listings debated at the 15th June 2026 Foreign Affairs Council.
• The package proposes transaction bans on 35 banks (31 Russian and four in third countries) and 11 crypto platforms, asset freezes on close to 90 banks in total, and a new power to impose a full crypto-asset services ban on third-country jurisdictions that facilitate sanctions evasion.
• The UK designated 18 crypto and financial entities on 26th May 2026 under the Russia (Sanctions) (EU Exit) Regulations 2019, including Eurasian Savings Bank of Kyrgyzstan and HTX, but has not yet mirrored the 21st package's broader bank transaction bans.
• The UK operates a separate sanctions framework under the Sanctions and Anti-Money Laundering Act 2018 and designates independently; UK measures have followed comparable EU measures within weeks to months, but the gap varies and carries no guarantee of alignment.
• Clients using correspondent banking routes through Central Asian or Gulf intermediaries face a live exposure window: EU-designated entities are already prohibited from any transaction with an EU nexus, and UK designation of the same entities can follow at any time without prior notice.

Introduction

On 9th June 2026, European Commission President Ursula von der Leyen announced the EU’s 21st Russia sanctions package, describing the measures as focused on ‘energy, financial services and crypto, trade, and this time, for the very first time, fisheries.’ This forms part of our wider guide to UK Russia sanctions: what businesses need to know. The package is the largest single financial sector action proposed against Russia since the full-scale invasion of Ukraine began in February 2022, covering asset freezes on close to 90 banks and transaction bans on over 30 banks and third-country entities.

For businesses and individuals in England and Wales, two questions follow immediately: whether and when the UK will mirror the new crypto and banking restrictions, and what a period of divergence means for transactions passing through correspondent banks in Central Asia or the Gulf. The answers differ, and both matter before formal EU adoption.

What does the EU’s 21st package actually propose?

The EU’s 21st sanctions package proposes transaction bans on 35 banks, including 31 in Russia and four in third countries, alongside transaction bans on 11 crypto platforms accused of helping Russia bypass existing EU restrictions. The package also introduces, for the first time, a legal power to ban crypto-asset services from entire third-country jurisdictions that host platforms used to circumvent EU sanctions, rather than requiring the designation of individual entities.

As President von der Leyen stated on 9th June 2026: ‘For the first time, we will introduce the possibility of a full third-country ban for crypto-asset services. It will act as a strong deterrent for countries hosting platforms that help Russia evade our sanctions.’ That statement marked a shift in the EU’s enforcement approach, moving from entity-by-entity designation toward jurisdiction-level exclusion.

The package also proposes asset freezes on close to 90 banks in total, the addition of 30 vessels to the Russian shadow fleet list (bringing the sanctioned total above 660), the first-ever EU import restrictions on Russian fish products, including a complete ban on cod, and a freeze of the oil price cap at $44.10 per barrel until January 2027. The oil price cap freeze is designed to prevent the automatic market-linked adjustment mechanism from operating during a period of price volatility. The package also targets 20 entities in third countries, banks, crypto platforms, and oil traders, in Kazakhstan, Kyrgyzstan, China, Turkey, the UAE, and India, that the Commission alleges have facilitated the circumvention of existing restrictions.

As of 19th June 2026, the package requires unanimous agreement across all 27 EU member states before any measure enters EU law. EU leaders meeting on 19th June 2026 called for rapid adoption. At the 15th June 2026 Foreign Affairs Council, individual entity listings and the entry ban on former Russian military personnel were under consideration. Still, the broader financial and trade measures, including the bank transaction bans and the crypto jurisdiction power, had not been formally passed at that date.

How does the UK sanctions framework differ from the EU’s?

The Sanctions and Anti-Money Laundering Act 2018 gives the Secretary of State and HM Treasury broad powers to impose financial, trade, and immigration sanctions against Russia. Those powers are exercised through the Russia (Sanctions) (EU Exit) Regulations 2019, which have been amended repeatedly since February 2022. The UK left the EU sanctions framework at 11pm on 31st December 2020; EU measures have not applied automatically in the United Kingdom since that date.

Designation decisions are made case by case by the Foreign, Commonwealth and Development Office (FCDO), with financial sanctions administered and enforced by the Office of Financial Sanctions Implementation (OFSI) under HM Treasury. The FCDO does not mirror EU measures automatically or on a fixed timetable. The UK designated PJSC Transneft in February 2026, before comparable EU action followed. In other instances, the UK has followed the EU within weeks. The Russia (Sanctions) (EU Exit) (Amendment) Regulations 2026, which came into force on 20th May 2026, adopted new LNG transport prohibitions and third-country processed oil bans that broadly tracked EU measures but were drafted and timed independently.

The key instrument for banking restriction in the UK regime is Regulation 17A of the Russia (Sanctions) (EU Exit) Regulations 2019. As OFSI stated in its December 2023 guidance update on correspondent banking restrictions, Regulation 17A prohibits UK credit or financial institutions from processing payments routed from or via a designated bank, even where the account holders sending and receiving the funds are not themselves designated. On 26th May 2026, the UK applied Regulation 17A for the first time to cryptoasset exchanges, designating 18 entities, including HTX (formerly Huobi), EXMO Exchange Limited, Bitpapa IC FZC LLC (registered in Ajman, UAE), and Eurasian Savings Bank of Kyrgyzstan. Any UK virtual asset service provider that processes funds previously routed via a designated exchange breaches the prohibition, even where the sending and receiving parties are not named on the UK Sanctions List.

On 16th June 2026, the UK added 70 new Russia sanctions to the UK Sanctions List, comprising 43 newly designated persons and entities and 27 newly specified ships. The package was an independent UK action announced by the Foreign, Commonwealth and Development Office; it was not a response to the EU’s proposed 21st sanctions package.

The package targeted Russia’s shadow fleet directly, sanctioning more than 20 oil tankers and LNG carriers, including vessels linked to the Arctic LNG 2 project, the first time the UK had designated LNG carriers connected to this venture. Third-country military procurement networks were also targeted, with suppliers in China, Turkey, and Thailand among those designated.

What does the divergence window mean for clients with third-country payment routes?

For clients in England and Wales whose payment routes pass through correspondent banks in Kazakhstan, Kyrgyzstan, or the Gulf, the gap between the EU’s adoption of the 21st package and the equivalent UK designation creates a specific, time-limited exposure that requires active management. The EU’s 21st package proposes extending transaction bans to 20 third-country entities, including banks, crypto platforms, and oil traders in Central Asia and the Gulf.

Once the EU formally adopts the 21st package, any transaction with an EU nexus, processed in euros, cleared through an EU correspondent bank, or involving an EU-incorporated entity anywhere in the payment chain, becomes immediately prohibited if the counterparty bank is listed. The UK prohibition does not apply until OFSI acts. A client cannot rely on re-routing away from EU-connected channels and treating the UK designation gap as cover: Regulation 17A of the Russia (Sanctions) (EU Exit) Regulations 2019 catches payments that pass through any UK institution, and the UK government monitors EU designations for potential mirroring. Foreign Secretary Yvette Cooper stated on 26th May 2026 that the UK ‘is adapting and strengthening our approach to target the evolving tactics Russia is using to evade restrictions.’

The exposure for clients using Gulf-registered intermediaries is equally concrete. The EU’s 21st package proposes to list entities in the UAE. Bitpapa IC FZC LLC, registered in Ajman, UAE, was designated by the UK on 26th May 2026. The Russia (Sanctions) (EU Exit) (Amendment) Regulations 2026 also introduced a prohibition on importing oil products processed in third countries from Russian crude. This measure directly affects the payment routes for Gulf refineries. Clients whose payment or trade flows pass through UAE-based financial intermediaries servicing Russian entities should review each counterparty against both the current UK Sanctions List and the EU consolidated list, and should not assume that the absence of a UK designation provides lasting protection.

The EU’s 21st package introduces, for the first time, the legal basis for a full sectoral ban on crypto services from third-country jurisdictions, rather than entity-by-entity designation. If adopted, that power could be used to cut off EU-market access to any crypto service provider registered in a jurisdiction the Commission considers a circumvention hub, without requiring individual listing of each platform. The Russia (Sanctions) (EU Exit) Regulations 2019 contain no equivalent sectoral jurisdiction-level power. Whether the UK will legislate to create one is unknown, but EU adoption of that provision would increase parliamentary and OFSI pressure to act.

Talk to Eldwick Law

If you need advice on how UK Russian sanctions affect your business, payment routes, or contracts, including reviewing correspondent banking relationships, applying for OFSI licences, or assessing exposure under both UK and EU measures, our sanctions team can advise you. We act for businesses of all sizes across England and Wales.