Wider Europe

Welcome to Wider Europe, RFE/RL's newsletter focusing on the key issues concerning the European Union, NATO, and other institutions and their relationships with the Western Balkans and Europe's Eastern neighborhoods.

I'm RFE/RL Europe Editor Rikard Jozwiak, and this week I'm looking at sanctions: specifically, the horse-trading behind the EU's latest restrictions on Belarus, and how Hungary is trying to get Russian oligarchs delisted.

Brief #1: The Complex Politics Behind The EU's Latest Sanctions On Belarus

What You Need To Know: When the European Union officially imposed another round of restrictive measures on Belarus on August 3, it put an end to one of the longest-running sanctions sagas in the bloc in recent years.

The new measures were the first targeting the regime of Alyaksandr Lukashenka since the summer of 2022. While early sanctions on Russia following the full-scale invasion of Ukraine in February 2022 were to a large degree imposed on Belarus as well, further EU sanctions on Moscow were not applied to Minsk. That was largely due to the belief in Brussels that Belarus's role in the Ukraine war couldn't be compared to Russia's.

Then a new problem appeared: Many of the sanctioned components that Russia requires for its war effort -- in particular, dual-use goods that can be used for both civilian and military purposes -- were being rerouted via Belarus. The latest round of sanctions on Belarus is partly meant to address this problem.

The original proposal from the European Commission, seen by RFE/RL, suggested measures such as a ban on EU companies providing IT, consulting, and polling services to Belarus; a ban on the export of luxury goods to the country; and a prohibition on the import of Belarusian gold and steel.

The final agreed-upon package, though, was a good deal watered down, with EU export bans on firearms, ammunition, and materials used in the aviation and space industries, along with restrictions on potential dual-use items, such as drones, semiconductors, and computer hardware. The rest from the original proposal was left out.

To understand why the final sanctions were weaker than originally envisioned, and why they took so long to come to fruition, it is helpful to understand two considerable drivers of EU policy. The first is the importance of the so-called Global South -- countries with growing political and economic clout in Asia, Africa, and Latin America. The second is classic Brussels horse-trading on political issues that are, at best, only tangentially linked.

Deep Background: The main reason for the delay in agreeing a new round of sanctions on Belarus -- apart from all the loopholes that needed to be closed -- was a proposed derogation, or exception, that would allow for the import of Belarusian potash, a key ingredient in fertilizers that the EU had already sanctioned as it is one of Minsk's main sources of income. A derogation on Russian potash exports had been agreed by the EU in December 2022, but a similar exception for Belarus was seen as being a little trickier.

Allowing the import of Belarusian potash would mean unfreezing the assets of the Belarusian tycoon Ivan Halavaty -- the CEO of Belaruskali, one of the biggest fertilizer producers in the world -- and those of Russian billionaire Mikhail Gutseriyev, who is building a potassium-chloride mining and processing plant in Belarus.

Crucially, allowing Belarusian exports of potash would mean the shipments being transported via Lithuanian ports, something which is deeply unpalatable to most Lithuanian politicians who tend to be the fiercest critics of the Lukashenka regime.

While Vilnius's refusal to agree on any potash derogations was backed by Estonia, Latvia, and Poland, there was a bigger group within the EU -- led by Portugal and other European countries with large ports -- that was pushing for the potash derogations.

This wasn't just a case of countries looking to secure vital income streams but also concerned issues of food security and allegations -- often stoked by the Kremlin -- that EU sanctions have led to food shortages in the developing world.

Drilling Down

• The EU has not sanctioned food exports, neither from Russia nor Belarus. However, those in favor of the potash derogation have argued that some countries, notably Brazil, a former Portuguese colony, have suffered because they have had to import alternative fertilizers for their agricultural sectors.
• Diplomats with knowledge of the matter but who are not authorized to speak on the record told me that Lisbon drove a hard bargain on the derogation issue because UN Secretary-General and former Portuguese Prime Minister Antonio Guterres is particularly sensitive to the concerns of the Global South.
• Recent developments in Belarus have given new urgency to the sanctions issue. First, there was the signing of an agreement in May to allow the deployment of Russian nuclear warheads on Belarusian territory; and then, making the situation even more acute, Wagner troops moved to Belarus from Russia under a deal to end the mercenary group's June rebellion led by its leader, Yevgeny Prigozhin.
• The deal started to come together at a summit of the EU and the Community of Latin American and Caribbean States (CELAC) in Brussels at the end of July. With Spain now holding the rotating presidency of the Council of the European Union, where ministers from EU countries convene to coordinate policies and adopt laws, Madrid was keen to show its partners -- including many of its former colonies in South America -- more than just goodwill.
• To show it meant business, Spain pushed for the EU to green-light the Post-Cotonou Agreement -- a pact between the EU and 79 African, Caribbean, and Pacific countries that had been only provisionally agreed upon. The first Cotonou Agreement -- signed in 2000 in the largest city in the west African country of Benin -- created the foundation for Brussels to strike deals with these countries, covering areas such as trade and migration, and was hailed as a groundbreaking development in the EU's relations with the Global South.
• The updated agreement, which would set the framework for EU relations with these countries for the next two decades, had been blocked by Hungary for the last three years. Hungary's reluctance to sign off was likely less to do with any objections to the pact but more about its tendency to bargain with the EU. Budapest made its support for the Post-Cotonou Agreement conditional on getting money from the EU budget that was still being withheld by the European Commission due to concerns about the rule of law in the country.
• While Budapest eventually came on board, Poland introduced its own veto. Warsaw also used the Post-Cotonou Agreement as a bargaining chip, noting the desperate situation of its own farmers in an attempt to get the 100 million euros ($110 million) promised to Warsaw by the European Commission to compensate for financial losses incurred due to Ukrainian agricultural imports. The commission, in turn, said it would not release the compensation until Poland implemented a Brussels-brokered deal that would allow Ukrainian agricultural products to pass through EU territory once again.
• While Poland received the money earlier this summer, Warsaw still blocked the Post-Cotonou Agreement, using its support as leverage to get the Belarus sanctions over the line before the EU's August break.
• After some intense horse-trading, the Post-Cotonou Agreement finally got the thumbs up on July 20, and the new Belarus sanctions were agreed without any exceptions for potash. The sanctions, however, were more limited in scope than the original European Commission proposal and came with a commitment to look into their possible impact on food security in the fall. The commission also made a pledge to explore further sanctions on Belarus going forward.

Brief #2: How Hungary Is Trying To Soften Sanctions On Russia

What You Need To Know: Before heading off on their summer break, the ambassadors of the 27 EU member states agreed to review some of the individual sanctions on the mainly Russian people and companies that the bloc deems to have undermined Ukraine's territorial integrity.

Since the February 2022 invasion of Ukraine, the bloc has slapped asset freezes and visa bans on more than 1,800 individuals and entities, including Russian President Vladimir Putin, Foreign Minister Sergei Lavrov, and many oligarchs and businessmen close to the Kremlin. The rollover of these sanctions usually takes place in March and September each year, offering individual member states a chance to make changes as the six-month extensions require unanimity.

Although no individual sanctions have so far been removed, the discussions have given Hungary plenty of opportunities to voice its displeasure about the EU's general sanctions policy on Russia. While Budapest has eventually agreed to all the EU's restrictive measures to date, it has used its veto power to water down some sanctions -- for example, by not agreeing that the head of the Russian Orthodox Church, Patriarch Kirill, should be targeted by the bloc; and by securing opt-outs for itself when it comes to the EU's embargo on Russian oil.

In September 2022, when the cases of sanctioned individuals were up for review, Budapest asked for the removal of three Russian oligarchs. It backed down, according to diplomats familiar with the file, after Hungarian officials were promised that the sanctions reviews would take place every six months and not every 12 as most other member states wanted, giving Budapest more opportunities to challenge the listings.

Hungary did just that. Ahead of the extension in March of this year, Budapest wanted nine people removed from the sanctions list. Once again, Hungary backed down but only after getting a commitment from the legal service of the Council of the EU to thoroughly examine the legitimacy of some of the listings.

Deep Background: When discussing the legal review ahead of the upcoming September rollover, I was told by diplomats familiar with the issue but who prefer to remain anonymous as they aren't authorized to speak on the record that Hungary has once again pushed for nine removals. (It's not clear if these are the same people Budapest wanted taken off the sanctions lists in March.) In the talks that took place throughout July, it was clear that there would be some delistings, though not necessarily the ones Hungary was pushing for.

The Council of the EU's legal service has identified so-called "weak cases," ones that EU lawyers fear they would likely lose in the European Court of Justice (ECJ), if challenged. So far, over 70 individuals and firms -- often wealthy oligarchs using expensive European lawyers -- have lodged appeals against their listings in the ECJ. Many hearings have already taken place, and some rulings are expected to come this fall.

Brussels would very much like to avoid the humiliation of losing such cases as it could open legal grounds for even more delistings. The EU has already lost one case, on March 8, after Prigozhin's mother, Violetta Prigozhina, challenged her inclusion on the list.

She had been sanctioned by the bloc due to supposed business ties with her son, but the ECJ reasoned that these links were tenuous at best. She remains listed because the ruling only concerned the decision to sanction her in February 2022 and not the subsequent renewals of the restrictive measures in September 2022 and in March of this year when the scope of EU sanctions was widened to make it easier to target family members of oligarchs. A warning shot, however, had been fired.

Drilling Down

• According to several officials who are familiar with the talks but who are not authorized to speak on the record, the EU is set to delist three individuals ahead of the September renewal: Aleksandr Shulgin, Farkhad Akhmedov, and Grigory Berezkin. Blacklisted in April 2022, all of them have taken their cases to the ECJ, and EU lawyers have indicated they are likely to win in court.
• Shulgin was presented in the EU's official journal, where the bloc's reasons for blacklisting are stated, as the "CEO of Ozon, Russia's leading multi-category e-commerce platform." The journal also noted that "he attended a meeting of oligarchs at the Kremlin with President Vladimir Putin to discuss the impact of the course of action in the wake of Western sanctions." According to EU sources familiar with his file but not permitted to speak on the record, Shulgin has submitted documents that state that he no longer has a connection to the company and no new evidence to the contrary has emerged.
• Akhmedov, who according to the EU's official journal, is "close to the Kremlin and is a leading businessperson involved in economic sectors providing a substantial source of revenue to the Government of the Russian Federation," notably by owning gas companies. According to EU sources familiar with his case, he is set to be delisted because he was sanctioned based on old information.
• Berezkin is described as "a leading Russian businessperson and considered to be the 'henchman' of President Vladimir Putin." As the chairman of the board of the Russian private equity firm ESN, the EU journal notes that he has invested in industries that have provided "a substantial source of revenue to the Government of the Russian Federation." According to sources familiar with his case, even some members of the Russian opposition support his removal from the list because he isn't thought to be closely linked to the Kremlin.
• Three removals were not enough for Hungary, however, with Budapest lobbying for a fourth person to be delisted. That was Nikita Mazepin, the racing-driving son of oligarch Dmitry Mazepin. Hungary might not get what it wants, though, as sources within the EU legal service have suggested that there is likely enough evidence to show that Mazepin junior has financial ties with his sanctioned father.
• There is still one key name missing from the sanctions list: Belarusian oligarch Alyaksandr Moshensky. Nicknamed "the fish king" due to his ownership of Belarusian seafood giant Santa Bremor, Moshensky is believed to enjoy close links to the Lukashenka regime. Various EU member states have tried to get him blacklisted several times, only to come up against Hungarian opposition, with Budapest citing "food security" as the reason. It's worth noting that Syarhey Niadbaylau, Moshensky's aide and the managing director of Santa Bremor, is also the honorary Hungarian consul in Belarus.

That's all for now. I am traveling this week, so please look out for the next newsletter on August 28.

Until next time,

Rikard Jozwiak

If you enjoyed this briefing and don't want to miss the next edition, subscribe here.

Welcome to Wider Europe, RFE/RL's newsletter focusing on the key issues concerning the European Union, NATO, and other institutions and their relationships with the Western Balkans and Europe's Eastern neighborhoods.

I'm RFE/RL Europe Editor Rikard Jozwiak and, this week, a slight break from the usual program to answer a burning question: What actually happens in Brussels during the summer?

How Brussels Functions During Its Long Summer Vacation

I got an out-of-office reply from a European Commission official the other day, saying that he will be back in the office on September 3. Given that this e-mail enquiry was sent in mid-July, that is quite some summer vacation. But then again, this is Brussels, and I've grown used to it over the years covering the European Union and NATO.

If there is one date that Brussels types (and I include myself in this) universally recognize as important, it's July 21. Why? Well, firstly, because it is Belgian National Day, so there's a public holiday with evening fireworks and fairground attractions in many of the city's parks. But more importantly, it is considered to be the "cutoff day" for officials and bureaucrats, a "mental vacation signpost" of sorts.

Granted, this year, EU ambassadors of the 27 member states are still meeting on July 26, and the bloc's agriculture ministers are also convening in the Belgian capital the day before. But otherwise, everyone in the Brussels bubble knows that by July 21, the working desks should be cleared, flip-flops and swimwear packed, and all outstanding political issues resolved. Because nothing really happens in the EU until September 1. No summits, no council meetings, no European Parliament plenaries or committees, no diplomatic or official gatherings. Go to Brussels' EU quarter, about a square kilometer or two of modern office buildings in concrete and glass roughly in between the airport and the historical city center, in August and you'll find a ghost town.

In Europe, this is not considered particularly extraordinary. Many national parliaments have recesses that stretch into several weeks over the summer -- often to coincide with school holidays that in most EU member states run for a good chunk of July and all of August. EU legislation mandates that all member states must grant all workers a minimum of four weeks paid vacation per year -- many companies and state institutions across the EU offer more. In EU institutions, officials often also get perks such as "travel days" to and from their home country; staff often accumulate enough free days to cover well over a month.

One justification for the longer vacations that you often hear from Brussels types is that it makes economic sense. I can't prove that the numbers stack up, but looking at the most visited countries in the world by tourists, France and Spain top the list and another four EU member states make the top 10. Tourism -- and the whole service-sector infrastructure built around it -- is crucial for so many EU countries' GDP. Or as one Brussels official wryly remarked to me just before jetting off, "It's my European solidaric duty to go to the Mediterranean and spend, spend, spend."

The long Brussels break can, however, cause some bemusement around the world, as international crises don't just stop because EU officials are on the beach or hiking in the Alps. One Brussels old-timer put it succinctly: "Countries and leaders who want to make mischief know that the best time to strike is around Christmas or in late July/August. We just pay less attention."

In fact, foreign policy issues almost always disrupt EU officials' vacations. Just look at the last three years. In 2020, it was the rigged presidential election in Belarus and the subsequent crackdown on demonstrators. In 2021, the Taliban took over Kabul and Western countries had to scramble to evacuate personnel from Afghanistan. And last year, there was much debate in the countries bordering Russia -- notably the Baltic trio and Finland -- about limiting or even prohibiting the entry of Russian holidaymakers from coming to places like Helsinki and Tallinn in order to head south to the bloc's warmer climes. Despite the absences, the EU reacted relatively quickly to all three events, organizing quick meetings with key officials, putting out timely statements, and eventually coming up with policy proposals.

But perhaps the most glaring example of an August mishap, in which the EU was caught completely flat-footed, was the five-day war between Russia and Georgia in 2008. It was my first summer in Brussels as a journalist and I remember the EU response as being pretty chaotic. The bloc's foreign ministers met in Brussels shortly after the war and couldn't really agree on anything, as they were so divided on how to deal with Russia. No sanctions were imposed on the Kremlin -- in fact, they couldn't even agree on suspending talks on a new EU-Russia partnership agreement that was in the works at the time or even whether to send a monitoring mission to observe the cease-fire.

It ended up with the French president at the time, Nicolas Sarkozy, getting involved in cease-fire negotiations, while the leaders of the three Baltic states and Poland (as well as non-EU member Ukraine) rushed to Tbilisi to show support. In short, it was a mess, and, in the end, Brussels failed to enact any meaningful and coherent measures as a response to the war.

The experience of the Georgia war was, however, a catalyst for a rethink on how the bloc should function in the dog days of summer. Two years after the Georgia war, the creation of the EU's diplomatic corps, the European External Action Service, has undoubtedly improved the strategic thinking and coordination in the bloc.

But perhaps the biggest boon for European diplomatic coordination has been technological progress. Today, all EU officials are glued to their smartphones, many communicating in Signal or WhatsApp groups. That, combined with online meeting platforms such as Teams or Zoom, the use of which was perfected during the coronavirus years, means that officials and bureaucrats are much more flexible and able to discuss and then approve a statement even from a Tuscan farmhouse or the wilds of the North Sea coast.

What hasn't changed is that EU officials (or their deputies) still have to meet physically in Brussels to enact policy, for example, imposing sanctions. Member states' ambassadors to the EU can, however, make those decisions without ministers in the related policy fields. With a green light from their respective capitals, they can make decisions -- such as sanctions or, to use a recent example, green-lighting more money to Ukraine -- via the so-called "written procedure," meaning that they give their OK within a certain time limit, usually a day. They can also utilize the "silent procedure," which means something is considered passed in the Council of the European Union -- where the 27 EU member states meet and make decisions, usually by unanimity on foreign-policy-related issues -- unless a country breaks the silence within a set period of time.

But what about NATO, the other giant institution in the Belgian capital? It tends to have a bit more of an "American" flavor to it, in this case, meaning shorter vacations. The North Atlantic Council, the military alliance's main decision-making body, continues its meetings into August, although it does usually take a two-week break in the middle of the month.

In the almost-empty offices of the European Union, there are a few unfortunate officials left to run the show. One official I spoke to said they will try to take online language classes this summer, if time allows. Another has an even more ambitious goal: reading up on all the thousands of pages of legal acts that constitute the EU's 11 sanctions packages imposed on Russia since the full-scale invasion of Ukraine in February 2022.

For journalists, it can be a similar story. Apart from preparing future obituaries of EU leaders, my favorite memory was discovering the sometimes absurd artwork in the European Parliament building. (One notable example is a giant metal horse given to the parliament by the former and late Italian Prime Minister Silvio Berlusconi.) I even witnessed the sprucing up of the European Parliament's Tree of Integration -- a six-story staircase bedecked with a tangle of connected iron bars. Once a year, a cleaner is equipped with a feather duster and tasked with giving it a rubdown. Quite a spectacle.

Looking Ahead

As mentioned above, not much is happening in Brussels this week, but EU ambassadors are still meeting and could potentially make some key decisions. One is that they could give a green light to more sanctions on Belarus. A proposal to hit the Lukashenka regime harder was put forward in January but has been blocked, mainly by Lithuania, as it also contained sanctions derogations for Belarusian potassium.

The mineral is one of the main sources of income for the Belarusian regime, and if it was allowed to be transported again, it would most likely cross Lithuanian territory, something Vilnius is firmly against. This new package is smaller and only really suggests tightening screws on Belarusian aviation and battlefield components. Crucially, it doesn't contain any opt-outs, including for potassium, for already sanctioned products, meaning that Vilnius can probably give its thumbs-up.

Another possible EU decision could be the cancellation of asset freezes and visa bans on some of the over 1,800 mostly Russian individuals and companies the EU has targeted since the invasion of Ukraine last year. The EU's legal service has identified a few weak cases, meaning that Brussels most likely doesn't have enough evidence that these individuals legally can be said to contribute to the "destabilization of Ukraine's territorial integrity."

These are individuals or companies that EU lawyers have likely determined would be cleared of wrongdoing if they challenged the sanctions in the Luxembourg-based European Court of Justice, the bloc's supreme court in terms of EU law. According to my sources who are familiar with the talks but not authorized to speak on the record, two or three people could very well be delisted already this week.

This is all a long way of saying that it's also my time to take a short summer break -- and, of course, contribute to Greece's GDP! The next newsletter will appear on August 14.

Feel free to reach out to me on any of these issues on Twitter @RikardJozwiak, or on e-mail at jozwiakr@rferl.org.

Until next time,

Rikard Jozwiak

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