OFAC names steel giant MMK in latest Russian sanctions | Article


Magnitogorsk Iron and Steel Works (MMK) and its majority owner and chairman of the board, Viktor Filippovich Rashnikov, were appointed in accordance with Executive Order 14024 for “operating or having operated in the financial services sector of the economy of the Russian Federation”. MMK ranked among the Top 50 steel producing companies in the world in 2021 and is considered one of Russia’s biggest taxpayers, according to OFAC.

Also referred to are MMK’s subsidiaries MMK-FINANS and MMK Metalurji, the latter being located in Turkey.

OFAC’s actions are reminiscent of the ever-changing US sanctions landscape despite Russia’s first invasion of Ukraine more than five months ago. The initial restrictions prioritized crippling the Russian economy while limiting the country’s elites from transferring their assets.

Note on Tuesdays announcement, Russian financial institution JSC PPIT has been singled out for its alleged role in a sanctions-busting scheme. The Deputy Managing Director of the Russian Direct Investment Fund indicated in February his intention to transfer all assets and cash from RDIF to JSC PPIT in anticipation of the former’s sanction. JSC PPIT has been appointed to help facilitate this action, OFAC said.

Another notable designation included Alina Maratovna Kabaeva, the supposed girlfriend of Russian President Vladimir Putin.

Regarding MMK, OFAC has issued a series of deadlines for the entities to cease doing business with the steel producer. Transactions necessary to end MMK’s involvement must be completed by September 1, while the divestiture or transfer of MMK’s debt or equity and the liquidation of related derivative contracts is permitted until October 3. Transactions involving MMK Metalurji must be completed by January 31. , 2023.

The State Department has also announcement a series of Russia-related restrictions on Tuesday, including the designation of Russia’s largest transport leasing company, JSC GTLK, and more than a dozen entities operating in the technology and electronics sectors from the country.

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