US Restricts Export of “Luxury Goods” to Russia and Belarus

The US announced new export restrictions of US-origin luxury goods that are impacted by new sanctions announced Friday and include certain spirits, tobacco products, clothing items, jewelry, vehicles, and antique goods.

These new restrictions could even impact small business online merchants as the list includes many common “luxury” items such as makeup, perfumes, gloves, bags, carpets, jackets, camping goods, life jackets, footwear, kitchenware, watches, etc.

While it is already difficult to send items to Russia and Belarus using small parcel carriers like USPS, FedEx, UPS, and DHL, sellers should look at this list to ensure they are not offering items in violation of these sanctions.

In addition, the rule also targets specific individuals, which may be outside of Russia or Belarus.

Sellers that operate businesses that may offer products covered by this rule should also look at the Specially Designated Nationals and Blocked Persons (SDN List) with any of the following designations:

• [RUSSIA-EO14024]
• [UKRAINE-EO13660]
• [UKRAINEEO13661]
• [UKRAINE-EO13662]
• [UKRAINE-EO13685]
• [BELARUS]
• [BELARUSEO14038]

That information is available from the US Department of The Treasury. Sellers should keep in mind that the SDN List has been rapidly expanded over the last few weeks and could continue to see more names added.

US Department of Commerce Announcement

The US Commerce Department’s Bureau of Industry and Security (BIS) imposed restrictions on the export, re-export, and transfer (in-country) of luxury goods to all end-users in the Russian Federation (Russia) and Belarus and to certain Russian and Belarusian oligarchs and malign actors located worldwide.

This action is in response to Russia’s brutal, continuing invasion of Ukraine (as substantially enabled by Belarus) in flagrant violation of international law.

“Putin’s war of choice in Ukraine continues to take a devastating toll on innocent civilians in Ukraine, fueling one of the worst humanitarian crises Europe has seen in decades. Putin and the oligarchs who fund him have gotten rich off of Putin’s rampant corruption and the exploitation of the Russian people. We will not allow Putin and his cronies to continue living in opulence while causing tremendous suffering throughout Eastern Europe. Today’s action takes away another source of comfort and reminds them that Russia is increasingly isolated.”

Secretary of Commerce Gina M. Raimondo

“The Department of Commerce will continue to vigorously exercise its authorities to deprive the Russian leadership of the material support it needs to sustain its aggression as well as the material comfort that insulates them from the harm they are inflicting,” said Deputy Secretary of Commerce Don Graves. “The people who have benefited most from Putin’s rule should know that they are international pariahs and that their money cannot insulate them from the unlawful actions they have facilitated.  This action also targets Russian and Belarusian oligarchs and other malign actors who have supported Putin.”

“Before today, controls on luxury goods only applied to rogue state North Korea—a regime where its leaders and their political cronies live in opulence while their people struggle.” said Assistant Secretary of Commerce for Export Administration Thea D. Rozman Kendler. “Today’s action should remind Putin and his Russian and Belarusian cronies that the world strongly condemns the horrors they have wrought. The US and our allies and partners will continue to stand together in imposing severe consequences on Russia and Belarus for the continued invasion of Ukraine.”

Rule Imposes Significant Restrictions on Export of US-Origin Luxury Goods

Today’s rule imposes significant restrictions on persons and organizations within Russia and Belarus that have the financial resources to purchase US-origin luxury goods. 

Additionally, this rule imposes additional costs on certain Russian and Belarusian oligarchs and malign actors (regardless of their location) who have been designated by the Department of the Treasury as Specially Designated Nationals in connection with their support for the Russian government.

This action underscores the consequences of Russia’s invasion of Ukraine and also demonstrates to influential Russian and Belarusian individuals the material impact on their lifestyle for their support of the Russian government’s actions in Ukraine.

The rule takes effect when released in the Federal Register on March 11, 2022. You can read the full rule here.

The White House said the export value of the products covered by today’s luxury goods restrictions is nearly $550 million per year.

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