SUMMARY The European Union (EU) has expanded its sanctions lists in response to Russia's war against Ukraine. It has imposed sanctions on several individuals and entities involved in the unlawful deportation and forced transfer of Ukrainian children to Russia.The Court of Justice of the European Union (CJEU) has clarified that assets placed in a trust must be frozen if the sanctioned person retains the ability to control or benefit from those assets.24 new criminal proceedings have been initiated in Latvia for violations of international sanctions.During Q2, the Financial Intelligence Unit of Latvia (FIU Latvia) received 359 suspicious transaction reports regarding suspected sanctions violations or attempted sanctions violations.Latvian courts concluded four criminal cases involving sanctions violations, imposing fines and ordering liquidation of a legal entity.The Customs Board of the State Revenue Service (SRS) initiated 52 administrative offence proceedings.FIU Latvia has published updated guidelines "Assessment of control of designated public officials".   Strengthening of Sanctions On 11 May, the Council of the EU adopted sanctions against an additional 16 individuals and seven entities involved in the unlawful deportation and forced transfer of Ukrainian children to Russia. According to the EU, the sanctions target persons and institutions involved in the systematic, unlawful deportation and forced transfer of Ukrainian children, the so-called militarised “re-education”, and unlawful adoption practices. The sanctions apply to Russian officials and politicians, children's centres, youth organisations, and other entities facilitating the integration of Ukrainian children into the Russian system. On 15 June, the Council of the EU adopted a decision to expand the EU's sanctions lists against Russia. The changes include additions to the lists of natural and legal persons subject to targeted financial sanctions in connection with Russia’s illegal war in Ukraine, Russia’s hybrid threat activities, and human rights violations. Notably, these additions to the sanctions list were adopted outside the EU’s broader sanctions package.   Key Judgments of the Court of Justice of the European Union On 21 May, the CJEU delivered a judgment interpreting the obligation to freeze assets under targeted financial sanctions in relation to funds and economic resources transferred by a sanctioned person into a trust. The CJEU ruled that assets transferred into a trust may be regarded as owned or controlled by the sanctioned person ns if that person retains powers enabling them to use, benefit from, dispose of, or otherwise exercise influence over those assets, including the ability to influence decisions made by the trustee in relation to them. On 11 June, the CJEU dismissed the appeal filed by Russia's National Settlement Depository (NSD) seeking its removal from the EU sanctions list. The CJEU held that an entity's significant role in Russia's financial system and its contribution to the functioning of the Russian state's financial system may constitute sufficient grounds for its inclusion on the EU sanctions list. The Court further clarified that it is not necessary to demonstrate that the entity directly financed Russia's military aggression or specific actions aimed at destabilising Ukraine. Rather, it is sufficient to establish that the entity provides material or financial support to the Russian Government or plays a significant role in the relevant sector. As a result, the CJEU dismissed the appeal and upheld the General Court's judgment confirming that the inclusion of Russia's NSD on the EU sanctions list was justified and should be maintained.   FIU Key Developments During Q2, FIU Latvia received 359 suspicious transaction reports indicating suspected sanctions violations or attempted sanctions violations. As in Q1, the most common cases in Q2 involved the potential transfer of sanctioned goods to Russia through third countries, the provision of prohibited services to legal entities established in Russia, accounts held with banks included on sanctions lists, and the transportation of cash to Russia. A total of 84 analytical reports concerning potential sanctions violations were submitted to law enforcement authorities and other institutions. FIU Latvia continues to update the “Frequently Asked Questions” (FAQ) section of its website regarding implementation of sanctions by clarifying existing explanations and adding new information. The updated FAQ section provides explanations on making payments after the end of transitional periods, the application of import bans and transit through the EU, the application of General License, the interpretation of contracts concluded before the imposition of sanctions, trade in goods imported before the imposition of sanctions, as well as restrictions on the provision of management services to legal entities registered in Russia and Belarus. FIU Latvia has published updated guidelines "Assessment of control of designated public officials". The guidelines have been supplemented in accordance with the definitions included in EU sanctions legislation of “owning a legal person, entity or body” and “controlling a legal person, entity or body”. Although EU institutions had previously provided guidance on the criteria to be considered when assessing ownership and control for the purposes of applying sanctions, these criteria have now been legally established in Regulation (EU) No 269/2014. FIU Latvia’s approach to the assessment of control remains unchanged. At the end of Q2 of 2026, the following assets owned or controlled by persons included on sanctions lists were frozen in Latvian financial institutions and state registers: Funds – EUR 151.9 millionReal estate – 103Vehicles – 66Tractors/self-propelled machinery – 11Watercraft – 1Herd – 1Trademarks – 12 The list of sanctioned persons whose assets have been frozen in Latvia is available here. Criminal Proceedings Statistics in Latvia During Q2 of 2026: 24 new criminal proceedings were initiated for international sanctions violations;criminal prosecution was initiated in seven criminal proceedings;charges were brought against nine natural persons;five criminal proceedings were referred to court.   In Latvian Courts During Q2 of 2026, Latvian courts examined four criminal cases concerning sanctions violations. Judgments in two of these cases have entered into force. In one case, a fine of EUR 10’100 was imposed on a natural person, while two legal persons were subject to coercive measures – one was ordered to be liquidated, and the other was ordered to pay EUR 17’900. In the second case, a decision to terminate criminal proceedings entered into force based on amendments to paragraph one of Section 84 of the Criminal Law, which entered into force on 10 June 2025 and provide for criminal liability in cases where the value of goods is not less than EUR 10’000. In two further cases, the judgments had not yet entered into force by the end of the quarter –one natural person was subject to probation supervision for four years, while the other was sentenced to community service.   Highlights from the Customs Board During Q2 of 2026, the Customs Board of the SRS initiated 52 administrative offence proceedings concerning sanctions violations. To prevent the movement of sanctioned goods across the EU external border, during the second quarter of 2026, the Customs Board refused to apply the declared customs procedures to 185 consignments. As a result, the export of 157 consignments of sanctioned goods from the EU and the import of 28 consignments into Latvia from Russia and Belarus were prevented. Most frequently, the refused exports concerned consignments containing spare parts for various devices and machinery, electrical equipment and parts thereof, as well as vehicle spare parts. Several cases were also prevented where attempts were made to export goods declared under an incorrect Combined Nomenclature (CN) code and whose supply to third countries is not possible because they are prohibited from being moved in transit through the territories of Russia and Belarus. Such goods included, for example, vehicle spare parts, iron or steel structures and parts thereof, as well as lubricants. In addition, during the second quarter of this year, 101 cases were identified involving attempts to export cash from the EU in violation of sanctions prohibitions. As a result of postal consignment controls, one violation was prevented, while in 51 cases violations by natural persons were identified involving attempts to move sanctioned goods across the border. Overall, during Q2 of this year, the Customs Board prevented 338 potential violations of EU sanctions against Russia and Belarus while carrying out customs control measures. From 25 to 29 May, a pilot mission of the European Union Customs Alliance for Borders (EUCAB) took place at the Terehova Customs Control Point in the field of customs officials’ mobility and exchange. Latvia is the first EU Member State where this new EUCAB initiative has been implemented in practice, ensuring the full organisational process and successful implementation of the mission at the Terehova Customs Control Point.   Example of a sanctions violation: use of a third country to deliver goods to Russia On 29 April, a suspected attempt to violate EU sanctions was prevented at the Terehova Customs Control Point. A freight vehicle operated by a carrier registered in Lithuania arrived heading towards Russia, and the driver submitted documents for customs control concerning goods (tumble dryers and their accessories) declared for export to Mongolia. A German company was indicated as the exporter in the customs declaration. During the inspection, a second set of documents was found containing different information, including the recipient of the goods in Russia and a higher value of the goods. During an in-depth examination, torn documents bearing the carrier’s stamp were also found, and it was established that some of the declared goods were not actually present in the cargo compartment. During the inspection, suspicions arose that the actual recipient of the goods was a Russian company, meaning that the EU export restrictions may apply to part of the consignment. The materials have been submitted for assessment of whether to initiate criminal proceedings.   About the Quarterly Publication FIU Latvia publishes a quarterly summary of the most significant sanctions developments and statistics to provide the public with regular and transparent information on the application and compliance with sanctions in Latvia. The summary has been prepared using information available to FIU Latvia, as well as data provided by the Prosecutor General’s Office, the Court Administration, and the Customs Board of the State Revenue Service.

The European Union (EU) has reached an agreement on the 21st package of sanctions against Russia. The new sanctions package targets the country's energy sector, one of its most significant sources of revenue, and introduces additional restrictive measures against the financial sector. The objective of these sanctions is to further reduce Russia's ability to finance its military aggression against Ukraine. Key elements of the 21st sanctions package Targeted financial sanctions Annex I to Council Regulation (EU) No 269/2014 has been amended to include: 48 natural persons 168 legal entities Inclusion in Annex entails an obligation to freeze all funds and economic resources belonging to, owned, held, or controlled by these persons, entities, or bodies. In addition, it is prohibited to directly or indirectly make funds or economic resources available to or for the benefit of these persons, entities, or bodies. Energy sector More than 40 additional shadow fleet vessels listed Suspension of the amendment of the Russian crude oil price cap To reduce Russia's revenues from oil exports, the new sanctions package suspends the price cap adjustment mechanism until 14 July 2027, maintaining the oil price cap at its current level. The price cap is currently set at USD 44.10 per barrel. Under the previous EU sanctions framework, the price cap for Russian oil was subject to regular review based on the average global market price of oil. These amendments eliminate the risk that, due to geopolitical developments and sharp fluctuations in oil prices, the EU price cap applicable to Russian-origin crude oil and petroleum products could increase. This price cap determines the maximum price at which EU persons may provide technical assistance and other services related to the maritime transport of such oil and petroleum products. Ban on transactions with designated oil refineries, ports, locks and airports The 21st sanctions package adds one more third-country oil refinery to the list of designated entities. The refinery processes or blends petroleum products or mineral products of Russian origin. The list has also been expanded to include specific Russian ports, locks and airports with which transactions are prohibited. Financial sector Stricter restrictions on third-country crypto-asset service providers to prevent sanctions circumvention A transaction ban has already been imposed on engaging in any transactions with legal entities based outside the EU that provide crypto-asset services or payment services to persons who are included on sanctions lists or who otherwise significantly impede the achievement of the sanction’s objectives set forth in the regulations. In this list multiple financial institutions have been added, broadening the transaction ban. The 21st sanctions package introduces a new annex which may in the future include any legal entities from third countries that provide crypto-asset services and whose activities are used to circumvent EU sanctions or violate prohibitions established in the field of crypto-assets. This annex will include entities that have systematically and persistently failed to prevent the provision of crypto-asset services thereby frustrating the provisions of sanctions regulations. Although no persons have been listed in the annex at this stage, the introduction of this mechanism sends a clear signal to third-country crypto-asset service providers that they may become subject to EU sanctions if they are involved in transactions that violate the EU sanctions regime. Expanded list of credit institutions subject to the transaction ban The list of credit institutions subject to the transaction ban has been expanded by an additional 33 credit institutions. As a result, the total number of credit institutions with which transactions are prohibited now exceeds 100. One credit institution from Kyrgyzstan has been added to the list of third-country banks using the Central Bank of Russia's Financial Messaging System (SPFS). In addition, more than 20 financial institutions providing crypto-asset services that significantly undermine the objectives of the EU sanctions have been added to the list. It is now prohibited to engage in transactions or otherwise conduct business with these financial institutions. Other sectoral sanctions The EU expands sanctions against persons supporting Russia's defence and security sector The EU has imposed sanctions on 51 legal entities which are a part of Russia’s military and industrial complex or supporting it in its war of aggression against Ukraine, on whom and on which tighter export restrictions are imposed regarding dual-use goods and technology, as well as regarding goods and technology which might contribute to the technological enhancement of Russia’s defence and security sector.The list includes legal persons established both in Russia and in third countries. Expanded list of goods and technologies subject to export and transit restrictions By adopting the 21st sanctions package, the list to include goods and technologies that could contribute to the enhancement of Russia’s military and technological capabilities or the development of its defence and security sectors has been supplemented. The goods and technologies included on this list are not only subject to export ban to Russia, but it is also prohibited to transport the items in transit through Russian territory. The export ban will apply to certain aviation-related products intended for use in unmanned aerial vehicles (UAVs), jamming and interception systems, as well as launch systems. Sanctions against Belarus In view of Belarus's involvement in Russia's war against Ukraine, the EU has also adopted new restrictive measures against Belarus. Some of these measures have been aligned with the new restrictions imposed on Russia. The adopted measures include listing additional persons who contribute to enhancing the military and technological capabilities of Belarus or Russia. In addition, the export ban has been expanded to cover specific goods, including certain aviation-related products intended for use in unmanned aerial vehicles (UAVs). More information on the new sanctions package in the Official Journal of the EU. Since April 2024, FIU Latvia has been the national competent authority for sanctions implementation in Latvia, working with Latvian and international partners to strengthen the effectiveness of sanctions.

The Financial Intelligence Unit of Latvia (FIU Latvia) has updated its guidelines, "Assessment of control of designated public officials." The guidelines explain how to assess the control criterion in situations where control over a legal person, public authority, or state-owned enterprise that is not itself subject to sanctions may be exercised by a public official designated under financial sanctions. Targeted financial sanctions apply not only to persons directly designated in sanctions lists, but also to legal persons, entities or bodies that are owned or controlled by designated persons. Consequently, assessing the control criterion is one of the most complex aspects of implementing targeted financial sanctions in practice, and a consistent approach to such assessments is essential for ensuring the effective implementation of sanctions and legal certainty. Due to Latvia's geographical location and historical economic ties, persons in Latvia may encounter public authorities and state-owned enterprises of Russia and Belarus. Therefore, the purpose of the guidelines is to promote consistent sanctions implementation practices and legal certainty by explaining the FIU's approach to assessing control in situations where a designated public official may exercise it. The second updated version has been prepared to align the guidelines with amendments to Council Regulation (EU) No 269/2014, introducing definitions of "owning a legal person, entity or body" and "controlling a legal person, entity or body" in Article 1 of the Regulation. Although the institutions of the European Union had previously clarified the criteria to be considered when assessing ownership and control for sanctions purposes, these amendments harmonise and expressly incorporate those legal concepts into Regulation (EU) No 269/2014. Consequently, the FIU's approach to assessing control has not changed in substance. "Assessment of control of designated public officials." Since April 2024, FIU Latvia has been the national competent authority for sanctions implementation in Latvia, working with Latvian and international partners to strengthen the effectiveness of sanctions.