UK Gov't Ends Russian Access To Professional Services

Law360, London (May 4, 2022, 4:32 PM BST) -- The government said on Wednesday that it will sever Russian access to profitable professional services in Britain as it ratchets up sanctions against the country for its war in Ukraine.

Britain's foreign secretary, Liz Truss, said it was "morally bankrupt" to continue doing business with Russia and has banned the country from using lucrative U.K. management consulting, accounting and public relations services — all of which are critical to the Russian economy, the government said.

The measures will mean businesses in Russia will no longer profit from these services, which account for 10% of Russian imports in these sectors, according to the government.

"Cutting Russia's access to British services will put more pressure on the Kremlin and ultimately help ensure Putin fails in Ukraine," Truss said.

Moscow relies heavily on Western services companies to produce and export manufactured goods, the government said. It added that cutting businesses from these markets will continue to dent profits for Moscow and exposes the dwindling economic opportunities left for Putin.

Business secretary Kwasi Kwarteng added that the move further tightens the screw on Russia as Western forces continue to explore all non-military based actions. "Our professional services exports are extraordinarily valuable to many countries, which is exactly why we're locking Russia out," Kwarteng added.

The ban on professional services was announced as 63 new sanctions were slapped on media figures and publications with ties to the Kremlin, as the government attempts to snuff out Putin's online propaganda efforts.

Search engines, social media companies and app store providers must now make every effort to block content from two blacklisted Russian state-backed companies – RT, the television network, and news agency Sputnik.

The government said it aims to end the social media tactics used by the Kremlin after British-funded research exposed the "shadowy" actions of fake social media profiles used to spread misinformation.

Correspondents from Russian state-owned broadcasters have also been sanctioned by Whitehall for allegedly spreading disinformation and wrongly characterizing the war as a military operation. The government has also imposed asset freezes and travel bans on individuals and organizations linked to the misinformation campaign.

Britain's latest round of sanctions follows the draft proposals outlined by the head of the European Commission on Wednesday.

President Ursula von der Leyen announced plans to phase out all Russian oil imports by the end of the year, as well as removing three major banks — including Sberbank, Russia's largest — from the SWIFT system used for global bank transfers.

The EU's proposals mark a decisive shift in direction for the commission, which had resisted oil sanctions because many of its member states rely on Russian fuel.

--Editing by Ed Harris.

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