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U.S. sanctions companies, people over Russia actions in Ukraine
December 20, 2016 / 6:46 PM / a year ago

U.S. sanctions companies, people over Russia actions in Ukraine

WASHINGTON (Reuters) - The United States on Tuesday targeted more Russian businessmen and companies over Russia’s annexation of Crimea and the conflict in Ukraine, slapping them with U.S. sanctions in a move Moscow criticized as hostile.

FILE PHOTO: Russian President Vladimir Putin delivers a speech during his annual state of the nation address at the Kremlin in Moscow, Russia, December 1, 2016. REUTERS/Maxim Shemetov/File Photo

The measures come a month before U.S. President Barack Obama hands over power to President-elect Donald Trump, who has praised Russian President Vladimir Putin and said it would be good if the two countries could get along.

Trump’s nominee for U.S. Secretary of State, Exxon Mobil Corp (XOM.N) Chief Executive Officer Rex Tillerson, has opposed U.S. sanctions on Russia, which awarded him a friendship medal in 2013.

The United States introduced sanctions on Russia after it annexed the Crimean peninsula from Ukraine in 2014 and expanded them over its support for separatist rebels in the East of the country.

But it is unclear if the United States will maintain the sanctions on Russia under Trump, who could lift the executive orders that authorise the measures.

In a statement, the U.S. Treasury named seven Russian businessmen, six of whom it said were executives at Bank Rossiya or its affiliates ABR Management and Sobinbank. The U.S. Treasury has called Bank Rossiya “the personal bank for officials of the Russian Federation” and had previously sanctioned it and the two affiliates.

One of the men named on Tuesday was Kirill Kovalchuk, whom Russian media have identified as a nephew of Yuri Kovalchuk, a major shareholder in Bank Rossiya. The United States sanctioned Yuri Kovalchuk in 2014, saying he was a close adviser to Putin and his personal banker.

The U.S. Treasury also sanctioned several companies and government enterprises for operating in Crimea, including two Russian firms it said were helping to build a multi-billion dollar bridge to link the Russian mainland with the peninsula, a project important to Putin.

The U.S. actions bar American individuals or companies from dealing with the sanctioned people or companies.

Treasury also named 26 subsidiaries of Russian Agricultural Bank and gas producer Novatek (NVTK.MM), both of which had already been sanctioned in 2014. U.S. sanctions on those companies are relatively narrow and prohibit Americans from dealing in certain kinds of debt with them.

Novatek is Russia’s largest non-state gas producer. Its chief executive and major shareholder is Leonid Mikhelson, one of Russia’s richest men.

Russia’s Deputy Foreign Minister Sergei Ryabkov told TASS news agency that the sanctions were hostile acts by the outgoing Obama administration and Russia would expand its sanctions lists against the United States in response.

“We retain the right to choose the time, place and form of our responsive actions in a way that suits us,” Ryabkov told TASS.

RUSSIA HOPES FOR EASING OF SANCTIONS UNDER TRUMP

U.S. State Department spokesman John Kirby in a news briefing on Tuesday denied suggestions that the timing of the measures was related to the transition next month.

    “This decision by the Treasury Department had nothing to do with the time on the clock,” Kirby said. “It had everything to do with Russia’s activities and support for the separatists in Ukraine and for their occupation of Crimea.”

    The U.S. move comes a day after the European Union formally extended its economic sanctions on Russia’s defence, energy and financial sectors until mid-2017, a move E.U. leaders agreed to last week.

    Trump’s election - and the mutual praise between him and Putin - has stoked hopes in Russia that Western sanctions might be eased or lifted under his presidency, potentially spurring investment in Russia’s flat-lining economy.

    A reversal by Trump of existing sanctions, or a softer U.S. stance on enforcing them, could also weaken European sanctions resolve.

    Valentina Matviyenko, the speaker of the Federation Council, the upper house of parliament, told a news conference on Tuesday that Trump’s forthcoming arrival in the White House promised to create the conditions for better U.S.-Russia relations.

    Commenting on what she referred to as “anti-Russian sanctions,” Matviyenko, a close ally of Putin, said she was sure that Western sanctions would be eased or lifted altogether in 2017.

    Trump may face opposition to easing restrictions on doing business with Russia by the U.S. Congress, which has shown it has little patience for the Kremlin’s military adventures.

    Both Republicans and Democrats have expressed concerns about Tillerson’s ties to Russia, and many Republicans, in contrast to Trump, view Putin as a calculating, untrustworthy foe.

    Additional reporting by Alexander Winning and Andrew Osborn in Moscow; Editing by Lisa Shumaker and Cynthia Osterman

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