Key developments in sanctions, countermeasures and cross-border disputes: insights from London Arbitration Week

Sanctions, Russian countermeasures, anti-suit, anti-arbitration and anti-enforcement injunctions have been discussed at the HKA event “Damages, Sanctions, and Justice in a Fractured World” at the inaugural London Arbitration Week.

From the outset, it was noted that only 1.2% of all sanctions are issued by the UN Security Council. Sanctions in relation to the most sanctioned country in the world, Russia, have increased nine-fold since February 2022. The debate also touched upon whether these restrictive measures are effective or not.

Participants further discussed the so called “Lugovoy Law” – the amendments to the Russian Code of Arbitrazh Procedure – namely new articles 248.1 and 248.2, passed in 2020. These articles granted Russian Courts jurisdiction over disputes with Russian sanctioned persons, even in cases where valid arbitration or jurisdiction agreements are in place, and the right to issue respective injunctions. Being supported by court’s right to impose a fine up to the amount of the dispute for non-compliance with the injunctions, the provisions were described at the event as an “extremely potent tool” or a “big bazooka”.

The panellists and attendees also looked at recent English Courts’ judgments on contract performance as affected by sanctions (Celestial Aviation Services Ltd v UniCredit Bank AG (London Branch)), notion of control (LLC Eurochem North-West-2 & another v Societe Generale S.A. & others) and the most recent judgment, rendered on 25 November 2025, in which the High Court refused to issue an anti-suit injunction in relation to Russian court proceedings (FH Holding Moscow Ltd v AO UniCredit (Russia) & another). The test of foreign illegality at the place of performance, formulated more than a hundred years ago, in 1920, by the English Court of Appeal was also discussed (Ralli Bros v Compania Naviera Sota y Aznar).

Additionally, the long waiting periods for the granting of sanctions licences were also reviewed. Such periods, it was said, could reach up to two years if the licences were requested from OFAC in the US and up to one year if applying to the UK’s OFSI.

Anatoly Matveev – Of Counsel of Civil Disputes, International Arbitration and Sanctions, Arbitration Insights.

Gherson LLP’s civil disputes, arbitration and sanctions teams are well-versed in handling the above issues on behalf of our clients. Our work involves managing the complex interactions between court and arbitration proceedings as well as dealing with all aspects of sanctions licencing regimes.

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