As Russia continues its criminal war against Ukraine, Europe should urgently deploy all the tools at its disposal to dismantle the Russia-linked state capture networks that have facilitated the Kremlin’s corrosive influence on international economic and political affairs.
On September 17, 2024, the Hudson Institute in Washington D.C. hosted a discussion on Europe’s lackluster sanctions enforcement mechanisms, the patchwork of weak anti–money laundering and criminal prosecution frameworks, and diverse networks of enablers who seek gains from transactional diplomacy and how each have emboldened the Kremlin to strengthen its maximalist war aims. Russia has also expanded its economic and political influence beyond Europe to create an authoritarian, anti-Western coalition in the Global South.
To empower frontline countries and mitigate authoritarian influence, the European Union needs to create institutional architecture focused on strategic decoupling from Russian energy dependence, cut Western technology and weapons supplies to Russia, and counteract the illicit financing channels that perpetuate the Kremlin’s war.
Ruslan Stefanov, Program Director at the Center for the Study of Democracy,opened the discussion by pointing out that we need to act bolder and swifter because we see time and again that the sanctions that have been imposed on Russia are being circumvented. The EU has created many institutions over the past two years and we need to put them in faster fruition as soon as possible.
Martin Vladimirov, Director of the Energy and Climate Program at the Center for the Study of Democracy,and Isaac Levi, Europe-Russia policy and energy analysis at Centre for Research on Energy and Clean Air (CREA),presented the latest research on sanctions evasion and the loopholes that Russia uses to import petroleum products and gas in the EU and the USA. Countries such as Turkey, China and India that do not impose sanctions on Russia refine crude materials into oil products, mostly gasoline and diesel and those fuels are later sent back to sanctioning countries. In the first half of 2024 alone countries from G7+ have imported almost $2 bn of Russian oil products from Turkish refineries, which are heavily reliant on discounted Russian crude.
Laura Kövesi, European Chief Prosecutor, pointed out that administrative sanctions need to be better enforced. The EPPO is the most powerful investigation and prosecution tool currently available in the EU when it comes to cross-border financial criminality and the circumvention of EU sanctions corresponds to this typology. This is why the new European Commission needs to pick up on an old Franco-German initiative and propose to enlarge the scope of the EPPO’s competence to the circumvention of EU restrictive measures.
