USA bans providing IT services and selling certain software to any individual in Russia

The U.S. Treasury Department has declared a ban on the provision of software and information technology services to any person in Russia as part of the expansion of sanctions. This measure has been implemented in consultation with the U.S. State Department.

The new restrictions forbid offering any person in Russia IT consulting and design services, IT support services, and cloud services for enterprise management software, as well as software for design and manufacturing. The aforementioned restrictive measures will come into effect on September 12, 2024.

The Export Administration Regulations (EAR) in American legislation control the export and re-export of many commercial goods, software, and technologies, along with “dual-use” goods, which can be used for military purposes. Goods governed by export rules are classified in the Commerce Control List (CCL), where each item has a unique number. Services not subject to the EAR rules are marked with identifier EAR99 in the list. The new restrictive measures propose implementing a rule to restrict the export of EAR99 class services because obtaining a license from the U.S. Bureau of Industry and Security (BIS) will be necessary.

In the Treasury Department’s press release, it notes that the new bans will not apply to certain telecommunications and internet-related operations or humanitarian actions. The Office of Foreign Assets Control aims to mitigate effects on Russian society with these exceptions and protect universal access to IT technology.

“We are increasing the risk [of secondary sanctions] for financial institutions working with the Russian military economy, eliminating avenues for sanctions evasion, and reducing Russia’s ability to benefit from access to foreign technologies, equipment, software, and IT services,” stated U.S. Treasury Secretary Janet Yellen.

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