Sittings · Document
Follow up to the European Parliament non-legislative resolution on EU actions against the Russian shadow fleets and ensuring a full enforcement of sanctions against Russia
Resolution tabled pursuant to Rule 136(2) of the European Parliament's Rules of procedure
Reference numbers: 2024/2885(RSP) / RC10-0161/2024 / P10_TA(2024)0036
Date of adoption of the resolution: 14 November 2024
Competent Parliamentary Committee: Committee on Foreign Affairs (AFET)
Brief analysis/ assessment of the resolution and requests made in it:
The resolution recalls the European Parliament’s support for the EU sanctions regime in response to Russia’s war of aggression against Ukraine and expresses great concerns over Russia’s ability to collect revenue from its energy exports to finance the war. It recognises that the EU has adopted unprecedented sanctions against Russia to diminish its revenues such as a ban on the purchase, import and transfer of Russian seaborne crude oil and certain petroleum products, the Oil Price Cap with G7+ partners and the targeting of specific vessels subject to a port and services ban. The resolution focuses particularly on the issue of sanctions circumvention by Russia especially through its growing reliance on a ‘shadow fleet’ of vessels of mostly old and unfit oil tankers which facilitate the evasion of sanctions and poses serious environmental, maritime safety and security risks.
The resolution draws attention to ‘shadow fleet’ vessels, which often sail without industry standard insurance, change their names and flag registrations, manipulate their tracking systems, conduct dangerous ship-to-ship transfers of Russian crude oil and oil products in Union territorial waters, and are suspected of engaging in hybrid operations. It also stresses the risks to economic resources of Member States since an oil spill from ‘shadow fleet’ vessels could result in major clean-up costs for coastal countries and their taxpayers.
The resolution calls for more actions against the shadow fleet, namely by establishing a list of all shadow fleet vessels and designating these vessels, as well as their owners, operators, managers, accounts banks and insurance companies. It calls for a prohibition for Western vessels to transport Russian oil and for the systematic sanctioning of vessels sailing through EU waters without adequate insurance. To restrict their activity, the European Parliament proposes to ban ship-to-ship transfers of Russian oil in EU waters, to restrict vessel sales to countries facilitating trade with Russia and for the seizing of illegal cargo.
To ensure the stricter enforcement of maritime safety regulations, the resolution calls for the enhanced monitoring and inspection of vessels. It highlights that the EU and its Member States should use the tools already available to them to tackle the risks posed by these vessels to prevent uninsured vessels from sailing though EU waters and docking at EU ports, such as obliging vessels to report all ship-to-ship transfers to flag states, verify insurance coverage and compliance with International Maritime Organisation standards and inspect vessels. The European Parliament also calls upon the European Maritime Safety Agency to enhance the support to Member States in monitoring suspicious ships. The resolution highlights the need for Member States to strengthen their administrative and surveillance capacities for effective enforcement.
To diminish Russian revenues, the resolution calls for more EU sanctions on Russian energy goods, such as a complete ban of Russian fossil fuel imports into the EU and a ban on re-exported Russian refined oil products, as well as restrictions on oil and liquified natural gas (LNG) tankers transporting Russian goods. It calls on G7 countries to more effectively enforce the oil price cap imposed on seaborne Russian oil and to substantially decrease it.
The resolution calls for broader international coordination with partner countries also recognising the importance of outreach to flag states. The resolution urges the European External Action Service (EEAS) and the EU Sanctions Envoy to reach out to the governments of countries whose flag registers or management companies are providing services to the shadow fleet. The European Parliament also calls upon the EU to re-assess its bilateral cooperation with countries which continue to help Russia to circumvent EU sanctions.
More generally, the resolution calls for the EU and its Member States to reinforce and centralise, at EU level, the oversight of sanctions implementation and sanctions circumvention monitoring and to intensify efforts to curb sanctions evasion and circumvention by Russia, calling for support for the work of the EU Sanctions Envoy to prevent the systematic re-export of sanctioned EU goods to Russia. It reiterates its call on the Council to expand the powers of the European Public Prosecutor’s Office to address the crime of violation of EU sanctions.
Response to the requests and overview of the action taken, or intended to be taken, by the Commission:
In very close cooperation with G7 partners, the EU has adopted 16 packages of sanctions to date in response to Russia’s unprovoked and unjustified military aggression against Ukraine. These unprecedented, complex and far-reaching individual and sectoral restrictive measures have opened a new chapter for EU sanctions in terms of the level of commitment and resources as well as international coordination and outreach involved.
The proper application of sanctions is key. Over the last two years, the Commission has held six high-level meetings with the Member States, as well as four meetings with sanctions coordinators from like-minded third countries, with a focus on addressing circumvention practices. Tackling possible circumvention attempts, including through third country jurisdictions, is among the Commission’s key priorities. The Commission is dedicating significant efforts to this – from legislative changes targeting those who facilitate circumvention and criminalising the violation and circumvention of sanctions to closely monitoring suspicious trade flows and organising dedicated outreach.
With regard to sanctions packages, with the 12th and 14th packages the EU has strengthened due diligence requirements for EU operators, introducing a “no re-export to Russia” clause, and requiring operators to identify and assess risks of re-exports to Russia, and to undertake their best efforts to ensure that sanctions are not undermined by non-EU companies they own or control.
With the implementation of the REPowerEU plan, the EU has significantly reduced its dependency on Russian gas imports. As regards oil, the EU has introduced a ban on the import of Russian oil, with limited exceptions which apply to a small number of Member States which still rely on Russian crude due to their geographical location.
The 14th package of sanctions has also introduced restrictions as regards Russian liquified natural gas (LNG). It is now prohibited to ship Russian LNG to EU ports; this prevents Russia from using EU infrastructures to further transport its LNG across the globe. It is also prohibited to export any good, technology and service to LNG projects under construction in Russia, such as Arctic LNG 2. A prohibition to import Russian LNG was also introduced for LNG terminals not connected to the EU gas system. In addition, the EU has already sanctioned two LNG vessels for their contribution to the generation of energy revenues for Russia. Further LNG vessels could be listed, subject to unanimous approval by the Council. Further restrictions on the nuclear sector, in particular on Rosatom, require unanimity in the Council.
In recent packages, the EU has also leveraged its sanctions powers to contain the shadow fleet. In the 12th package, the EU introduced a notification rule for the sale of a tanker to any third country to make the trade of second-hand tankers more transparent. This allows the Commission to closely monitor tankers sold to third countries and which may be joining the dark fleet. When such tankers are sold to a Russian person or entity, or for use in Russia, the sale must be authorised by a Member State’s competent authorities. The Commission is ready to assess further measures in relation to tanker sales.
In its 14th package of June 2024, the EU adopted a measure targeting specific vessels contributing to Russia’s warfare against Ukraine, which are subject to a port access ban and a ban on the provision of services. These vessels can be targeted for various reasons such as the transport of military equipment for Russia, the transport of stolen Ukrainian grain, and support in the development of Russia’s energy sector, for instance through the transport of LNG components or transshipments of LNG. This measure also targets tankers that are part of the shadow fleet which circumvent the EU and Price Cap Coalition’s caps while adopting deceptive shipping practices in complete disregard of international standards. In the first round of designations under the 14th package, the EU targeted 27 vessels, including 17 tankers involved in the transport of Russian oil. In the second round of designations under the 15th package (December 2024), the EU targeted a further 52 vessels including 42 crude oil and petroleum product tankers transporting Russian oil. In the third round of designations under the 16th package (February 2025), 74 vessels were designated, including 72 oil and petroleum product tankers, thereby bringing the total number of designated vessels to 153. To date, this measure has a sizeable impact on the shadow fleet’s activity. These vessels have often changed their names, flag and ownership to obfuscate their identities. Despite such attempts, the vessels become tainted and struggle to lift oil. This also increases the costs on Russia to operate with such a fleet.
The list of designated vessels will be updated as regularly as needed to address the ever-shifting composition of the shadow fleet. At the same time, it should be noted that targeting requires thorough preparation to ensure a solid legal basis. The Commission is actively working with Member States, international partners, and the private sector to identify additional vessels. In this endeavour, the Commission also relies on the support of the European Maritime Safety Agency (EMSA).
In addition to vessel targeting, the EU has listed entities supporting Russian energy exports which become subject to an asset freeze and a prohibition to provide economic resources. This includes Sovcomflot, Russia's largest shipping company specialising in the transportation of liquefied gas, crude oil, and petroleum products, as well as other leading companies in the energy sector. The EU’s 15th and 16th packages include listings of shipping companies and managers of shipping companies facilitating the transport of Russian oil. Any vessels owned or operated by these individuals or entities also become subject to restrictions, for example on accessing EU services.
Regarding circumvention practices and enforcement (paragraph 7), the Commission regularly exchanges with business associations on compliance with sanctions and has set up a contact group to discuss with Member States the implementation of sanctions from a customs perspective, including elements and data that are relevant for risk assessment and management purposes. Specifically, the EU closely monitors suspicious trade of dual use and advanced technology items including Common High Priority (CHP) goods to prevent these items falling into the hands of the Russian military-industrial complex. Careful analysis of trade data has allowed the Commission to identify third countries that are at risk of being used as platforms for circumvention. The Commission is conducting bilateral dialogues with all Member States to discuss identified implementation shortcomings.
Work on circumvention is coordinated closely with Member States, whose national competent authorities are the main bodies responsible for sanctions implementation and enforcement. To counter sanctions circumvention and ensure the highest level of due diligence, the Commission has also intensified its regular exchange with EU economic operators, regularly providing and updating guidance documents. So far, the Commission has published more than 600 frequently asked questions (FAQs) on its website, sorted by topic. The Commission has also issued specific guidance, such as guidance on due diligence to fight circumvention, on the oil price cap, or on CHP items. On 24 September 2024, the Commission published a joint guidance developed within the G7 Sub-Working Group on Export Control Enforcement to raise awareness on sanctions evasion risks and indicators and to help relevant business operators address and mitigate such risks.
The Commission, together with its G7+ partners, is continuously assessing how to further improve the Oil Price Cap. While the Oil Price Cap aims to achieve the dual objectives of reducing Russia’s revenues to finance the war in Ukraine, while keeping Russian crude oil and petroleum products on the global market, the impact of the Cap has diminished over time due to a combination of high oil prices and Russia’s increasing reliance on the shadow fleet of tankers. The Commission is currently working with G7+ partners to find ways to strengthen the enforcement of the price cap.
The Commission is also in contact with industry stakeholders which are active in the transport of Russian oil, including traders, shipowners and insurers, to better understand the implementation challenges of the oil price cap. This feedback is carefully analysed by the Commission to bring improvements to the price cap mechanism. For instance, the Commission clarified in its FAQs related to the oil import ban that ship-to-ship transfers of Russian oil are prohibited in the Member States’ territorial waters (FAQ 17).
Besides taking action against entities and individuals that are actively undermining the impact of its sanctions, the EU is reaching out to third countries including through cooperation with third countries via the diplomatic outreach of the EU Sanctions Envoy David O’Sullivan, as well as capacity-building opportunities.
Ensuring that EU sanctions are not circumvented lies at the core of the mandate of the Sanctions Envoy, who took up his office in January 2023. He has been visiting countries identified as hubs from where sensitive EU-origin goods are re-exported to Russia, such as Kazakhstan, Kyrgyzstan and Uzbekistan in Central Asia, Serbia, Armenia and Georgia. Lately the Sanctions Envoy’s outreach has also focused on Southeast Asia (Singapore, Malaysia, Thailand and Vietnam). The Sanctions Envoy is also visiting countries such as India, Türkiye and the United Arab Emirates to discuss Russian energy exports and the shadow fleet.
As regards to outreach to flag states, the Commission and the European External Action Service have reached out to authorities in key jurisdictions. Flag States have the primary responsibility to ensure that their ships are safe to sail and comply with the safety and pollution prevention requirements. EU delegations are engaging at local level to disincentivise the registration of EU targeted vessels and highlight the adverse impacts of high-risk shipping practices and the responsibilities that lie with those countries that provide services to such vessels. Some positive impacts resulting from the Commission’s outreach can already be noted. For instance, Panama has issued a decree for the cancellation of vessels that are targeted by the EU.
Regarding the calls for action related to maritime safety and pollution prevention (paragraph 3), the Commission is in continuous discussion with relevant authorities in the Member States for enhancing the maritime surveillance capacity and tools, hosted in the European Maritime and Safety Agency (EMSA), for targeted support in their monitoring and enforcement. This includes the monitoring of ship behaviour as well as tracking and tracing their voyages to detect any suspect practices such as not respecting international instruments rules and guidance concerning ship-to-ship transfers and/or illegally turning off the Automatic Identification Systems (AIS) transponder. For the latter aspect, the Commission has set up an ad hoc technical expert group to investigate how to identify tampering (spoofing) with the position and identification systems (AIS or Long-Range Identification and Tracking, LRIT, signals).
In so far as any such vessel is sailing to any EU Member State’s port, such maritime surveillance support and information helps the Member State carry out an inspection, normally under the port State control regime applicable under EU law.
With regard to marine insurance (paragraph 9), the Commission is currently working with Member States, not only to enforce Directive 2009/20/EC on the insurance of shipowners for maritime claims, that already includes the possibility for a Member State to expel a ship not in compliance (and where such an expelled ship subsequently cannot call at any other Member State ports) that are sailing on their ports, but also consider how to require that the same insurance information is reported when a ship sails along the EU Member States’ coasts (in so called ship reporting systems, especially applicable in e.g. dense traffic waters, like straits) but never goes into port. This would allow the identification of ships that are not reporting and can be assumed not to meet the international requirements for marine insurance in this respect. That would allow the Member State as a coastal State to verify the existence of insurance and also the coverage of the insurance and where doubtful, take appropriate action within the frame of International Law (UNCLOS – the Law of the Sea). Furthermore, it could become an indication for candidate ships for possible further investigation with the flag State concerned, as well as future listings under the sanctions regulation (as explained above).
The approach for this action would be to share the information reported, in the same way as is the case today for information required before a port call, via the Union Maritime Information and Exchange System (SafeSeaNet), so that all relevant administrations, cross-Member States and cross-sector, are aware of any suspect and potentially substandard ship carrying dangerous and polluting cargo as early as possible and can monitor more carefully. In this respect, the Commission, together with EMSA and the Member States has started a reflection of the current top-up capacities and capabilities e.g. Stand-by vessels network, to ensure optimal pollution preparedness support, in particular for large scale oil spills.
It is to be noted that the oil tanker transit traffic has increased, but since the EU has introduced an oil embargo on Russian origin oil, such oil cannot be discharged at any EU Member State port. It should also be recalled that there is a general prohibition on all Russian flagged ships, as well as to ships certified by the Russian Maritime Register of Shipping (RMRS), to call at EU Member States ports, since shortly after the start of the aggression.
In parallel to the concerted actions within the EU, there are EU coordinated actions with the Member States in international fora: in the International Maritime Organisation (IMO); International Mobile Satellite Organisation (IMSO); and, the International Oil Pollution Funds (IOPC) on a range of actions stemming from the IMO Resolution A.1192(33) to prevent illegal operations in the maritime sector by the ‘dark’ or ‘shadow’ fleet. These actions focus on the responsibility of States as flag States and the absolute need for any flag State to ensure they have the capacity, ability, and control to enforce all obligations incumbent on the under international law. Actions proposed range from conducting a regulatory scoping exercise of relevant rules and regulations available for Member States, with a view to prevent illegal operations in the maritime sector by the “dark fleet” or “shadow fleet”, including measures to prevent the misuse of AIS or LRIT ship identification and tracking systems, to underlining obligations on flag States in relation to accepting marine insurance and guidance in how to verify insurers, and to detect unlawful practices associated with the fraudulent registration and fraudulent registries of ships and registers.
The Commission and EU Member States actively work with likeminded partners in these international fora and continue to do so. A central theme in this work is transparency and putting the ‘spotlight’ on dark fleet operators and operations. This aspect is also included in the outreach explained above, as part of the deterrent approach with sanctions and restrictive practices.