Mr. Sanctions

August 7, 2026: Burning Question: Has the EU plugged up the holes in the dike?

So, I’m a beta tester for ACSS‘ CSS-EU certification exam, and I’ve been studying. In the midst of it, I came across the following “non-paper” issued by the Dutch government in February 2023 about sanctions enforcement:

non-paper-on-russia-sanctions-circumventionDownload

and I was curious – how much of this actually got promulgated by the EU? So, I asked Claude – here’s the response:

Quick note on dating: the paper’s reference to the 9 February 2023 European Council conclusions places it right around the EU’s 10th sanctions package. Everything below covers what’s happened across the roughly eleven packages adopted since (11th through 21st, the last landing July 23, 2026).

Context

The paper came from the Dutch government in the run-up to what it called “the year of success in countering circumvention.” It made five clusters of asks. Here’s each one, and where it actually stands 3.5 years on.

1. Strengthen the feedback loop between national enforcement and EU-level policy

Proposed: Better cooperation between customs, tax authorities, prosecutors, intelligence services, and statistics agencies at the national level, with that intelligence routed up to Brussels so loopholes in the sanctions text itself could get closed.

What happened: The concrete deliverable here is Directive (EU) 2024/1226, adopted April 24, 2024, which harmonizes the definition of criminal offenses and penalties for sanctions violations across Member States and builds a formal cooperation channel among national authorities, the Commission, Europol, Eurojust, and the European Public Prosecutor’s Office though it stops short of a single EU-level entry point for reporting breaches that span multiple Member States. Transposition was due by May 20, 2025. The Commission opened infringement proceedings against 18 Member States in July 2025 for failing to fully transpose it. As of early 2026, practitioner commentary is still describing EU sanctions enforcement as structurally fragmented, with divergent penalty regimes and investigative approaches across Member States encouraging forum shopping by operators seeking softer enforcement jurisdictions, and a mid-2026 industry survey went so far as to call fragmentation, not designation volume, the defining sanctions challenge of the year, with regulators now moving in different directions rather than the relative coordination seen earlier in the war.

Verdict: Real legislative architecture exists now that didn’t in February 2023. But this is the one proposal area where the paper’s own diagnosis (uneven application among Member States) is, by the EU’s own admission via infringement actions, still an open problem.

2. Strengthen the EU point of contact for circumvention

Proposed: A safe channel for Member States to share circumvention intelligence in Brussels, a platform for common analysis, and explicit use of the incoming Anti-Money Laundering Authority (AMLA, cited at 500 FTE) for this purpose.

What happened: The Sanctions Coordinators Forum, chaired by the EU Sanctions Envoy, has become the closest thing to the coordination venue described. By its seventh meeting in 2026 it was gathering high-level representatives from all Member States plus the US, UK, Canada, Japan, South Korea, Liechtenstein, New Zealand, Norway, and Switzerland, with Ukraine joining for dedicated sessions. That’s broader (and more diplomatic in character) than the narrower Brussels analysis cell the paper described.

AMLA itself did get built, though its link to circumvention specifically is thinner than the paper implied. It was formed June 26, 2024, headquartered in Frankfurt, and took up operations July 1, 2025. It absorbed the European Banking Authority’s AML/CFT mandates on January 1, 2026, and direct supervision of roughly 40 selected high-risk entities is scheduled to begin in 2028. Its core mandate is money laundering and terrorist financing; sanctions-compliance monitoring by obliged entities sits within that broader remit rather than as a dedicated anti-circumvention function, and its staffing trajectory (roughly 430 by end-2027) is smaller than the 500 FTE figure the paper cited.

Verdict: A coordination venue exists and meets regularly, and AMLA exists roughly on schedule. But I couldn’t find evidence of a discrete, named “circumvention information-sharing platform” as such. What exists instead is a layered patchwork: the Forum, the Europol/Eurojust/EPPO channel created by the 2024 Directive, and AMLA on the financial-intelligence side, which is a looser outcome than a single point of contact.

3. Diplomatic outreach

Proposed: A Special Envoy, EU démarches, letters from EU institutions, coordination with G7-plus partners.

What happened: This is the proposal that landed most cleanly, largely because it was already in motion. David O’Sullivan took up the role of International Special Envoy for the Implementation of EU Sanctions in January 2023, essentially contemporaneous with the paper itself. He’s since made the outreach role highly visible: in February 2026 he traveled to Kyrgyzstan and told reporters that trade data showed goods being imported there for the specific purpose of re-export to Russia, singling out radio equipment and machine tools; he’s made joint trips to Kazakhstan and Kyrgyzstan with his UK counterpart; and in June 2026 he told Euronews that China remained a “very big problem” for circumvention, with no sign of it abating.

Verdict: The most fully and durably realized of the five clusters.

4. Expand the EU toolbox

This proposal had several distinct sub-parts, worth taking one at a time.

Guidance for companies: The Commission published practical guidance for EU operators on September 7, 2023, setting out enhanced due-diligence expectations for strategic risk assessment and best practices for screening business partners, transactions, and goods, plus a list of circumvention red flags. It’s been refreshed since in coordination with G7 partners as part of joint industry guidance on preventing sanctions evasion. Realized, and fast.

Contractual end-use obligations: The “no-Russia clause” under Article 12g of Regulation 833/2014 was introduced in the 12th package in December 2023, requiring exporters to contractually prohibit re-export to Russia, and was later extended to Belarus. Realized.

Trade toolbox against a non-cooperative state: The anti-circumvention tool, Article 12f of Regulation 833/2014, was introduced as an “exceptional and last resort measure” in the 11th package in June 2023. It then sat unused for nearly three years. It was first activated in the 20th package, imposing targeted export restrictions on Kyrgyzstan in response to systemic evasion, specifically covering CNC machine tools and telecommunications equipment being diverted to Russia for drone and missile manufacturing. Realized, though the multi-year gap between creation and first use suggests Member States found it politically harder to invoke than the paper anticipated.

Watch list / published suspicions: The closest analog is the Common High Priority List, a jointly maintained EU-US-UK-Japan list of dual-use and advanced-technology items found on the battlefield or critical to Russian weapons production, first published in 2023 and expanded since. That’s a goods list, though, not the entity-level “watch list” or publication of unproven “suspicions” the paper floated as a way to enable due diligence short of formal listing. I didn’t find evidence the EU adopted that softer mechanism; where it had sufficient evidence, it moved straight to formal designation rather than a public warning step.

Verdict: Substantially realized across three of four sub-elements, with the “publish suspicions” idea appearing to be the one that wasn’t taken up.

5. Expand listing capacities

Proposed: Broaden the ability to list third-country persons and entities beyond the narrow original criteria, which required proving a link to circumvention by an EU actor, and cover a wider category of components tied to weapons production.

What happened: The 11th package amended Regulation 269/2014’s listing criteria to add persons and entities that “significantly frustrate” EU sanctions. Since then, successive packages have repeatedly added third-country entities under Annex IV of Regulation 833/2014, language in the Council’s own 2026 texts describes entities “in third countries other than Russia that indirectly contribute to Russia’s military and technological enhancement thereby enabling the circumvention of Union restrictive measures or frustrating their purpose”, which tracks the non-paper’s ask almost verbatim. The 19th package, in late 2025, specifically designated non-Russian operators in the UAE and China producing or supplying military and dual-use goods to Russia, and the EU’s asset-freeze list by that point already included entities established in the UK, China, Hong Kong, the UAE, and Kyrgyzstan.

Verdict: The second most fully realized cluster, with a clear and repeated pattern of use across nearly a dozen packages rather than a one-off change.

Bottom line

Ranked by how faithfully the EU followed through: diplomatic outreach and expanded listing capacity were both substantially delivered and are still actively used today. Toolbox expansion was mostly delivered, guidance, the no-Russia clause, and the anti-circumvention tool are all real and in force, with the softer “publish suspicions” idea being the exception. The feedback-loop proposal produced genuine legislation in Directive 2024/1226, but its central goal (unified application) remains, by the Commission’s own infringement actions, unfinished. And the “point of contact” proposal exists in a more diffuse form (Forum plus Europol/Eurojust/EPPO plus AMLA) than the single Brussels platform the paper described.

Worth flagging something the non-paper didn’t address at all: unanimity. Every package still needs all 27 Council votes, and that friction has visibly shaped recent outcomes, the 20th package had to clear a Hungarian veto threat before adoption, and the 21st package in July 2026 emerged narrower than the Commission’s original June proposal after Member States pushed back on scope. None of the five proposals touch that structural constraint, and it’s arguably the single biggest brake on how fast anti-circumvention policy can move regardless of how well the other five workstreams perform.

Self-check

High confidence, multiple independent sources: O’Sullivan’s appointment and role, the anti-circumvention tool’s creation and first (Kyrgyzstan) use, the no-Russia clause, Directive 2024/1226 and its transposition shortfall, the AMLA timeline, the September 2023 Commission guidance, and the pattern of third-country Annex IV listings.

Lower confidence: I could not confirm or rule out whether the EU seriously considered and rejected a formal “publish suspicions short of listing” mechanism, versus simply never taking it up, my read is an absence of evidence in press and legal-alert coverage, which isn’t the same as proof it doesn’t exist. Similarly, “no discrete circumvention information-sharing platform” is an inference from silence rather than a confirmed negative, worth a targeted follow-up search if it matters for the piece.

Sources

It’s nice to see “asks” become real, don’t you think?

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