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US Imposes Sanctions On Russian Railroad Operator

The U.S. Treasury Department's Office of Foreign Assets Control (OFAC) has announced sanctions against Moscow-based Grand Service Express for operating a passenger rail service between the Russian mainland and Crimean Peninsula.

Benzinga · 01/30/2020 14:24

The U.S. Treasury Department's Office of Foreign Assets Control (OFAC) has announced sanctions against Moscow-based Grand Service Express for operating a passenger rail service between the Russian mainland and Crimean Peninsula.

The agency said on Wednesday it added the Russian railroad, as well as CEO Alexander Ganov, to the Specially Designated Nationals and Blocked Persons (SDN) List for supporting Russia's occupation of the Crimean Peninsula.

U.S. persons and companies are generally prohibited from conducting business with individuals or entities on the SDN List. Additionally, any entities owned 50% or more in the aggregate by these listed individuals are blocked.

Grand Service Express began offering service to the Crimea via the Kerch Strait Bridge in late December, a violation of OFAC's Ukraine/Russia-Related Sanctions program.

The Russian railroad's action also reinforces the July 25, 2018, Crimea Declaration, which states the U.S. neither recognizes Russia's annexation of Crimea nor its use of force in Donetsk and Luhansk in eastern Ukraine. Russian troops officially entered Crimea and drove out Ukrainian military forces on March 1, 2014.

Since taking office, the Trump administration has increased U.S. economic sanctions against both Russian industries and businessmen under authority of the Countering America's Adversaries Through Sanctions Act (CAATSA).

Besides Grand Service Express and its CEO, OFAC added seven government officials who represent the Russian-controlled Republic of Crimea to the SDN List. They include Yuri Gotsanyuk, prime minister; Mikhail Razvozhaev, acting governor of Sevastopol; Vladimir Nemtsev, legislative assembly chairman; Sergei Danilenko, Sevastopol Election Commission chairman; Lidia Basova, Sevastopol Election Commission deputy chairman; Ekaterina Pyrkova, Sevastopol Election Commission secretary; and Ekaterina Altabaeva, member of the Federation Council of the Russian Federation representing Sevastopol.

The European Union and Canada also added the seven Russian government officials to their respective control lists for their interference in Crimean politics.

"The coordinated U.S., EU, and Canadian designations limit the ability of these illegitimate officials to do business internationally and highlights the strength of the transatlantic alliance in standing up to Russia's continued aggression," Treasury Secretary Steven Mnuchin said in a statement on Wednesday.

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