On March 12, the European Parliament adopted Directive 2024/1226, aimed at strengthening the enforcement of EU sanctions against third parties as part of its common foreign and security policy. This directive, which amends Directive (EU) 2018/1673, defines the criminal offenses and sanctions applicable in cases of violation of EU restrictive measures. It aims to address the inconsistencies in the enforcement of sanctions, particularly in the context of the war in Ukraine, by providing a clear and binding legal framework.

The EU has implemented over 40 sanctions regimes, targeting countries such as Russia and Iran. These sanctions include arms embargoes and restrictions on dual-use civil and military goods. However, the inconsistent application of these sanctions has been deemed ineffective by the European Commission. Directive 2024/1226 aims to remedy this situation by precisely defining the offenses and sanctions in cases of non-compliance with EU restrictive measures.

This directive allows Member States to classify certain acts of violating EU restrictive measures as criminal offenses. Both individuals and legal entities can be prosecuted. Companies can be held liable if an offense is committed by a person holding a managerial position within them. Sanctions for companies can include a ban on conducting business activities and the withdrawal of economic permits and licenses. The directive requires companies and their partners to prevent, stop, or mitigate negative impacts on human rights and the environment through their supply, production, and distribution chains.

Member States will therefore need to provide companies with detailed online information about their due diligence obligations. A supervisory authority will be created or designated to investigate and impose sanctions on companies failing to meet their obligations.

Member States have until May 20, 2025, to transpose the directive into their national legislation, with a phased implementation of the new rules for European and non-European companies meeting certain turnover thresholds in the EU between 2027 and 2029.

Directive 2024/1226 represents a significant advancement in combating violations of EU sanctions and protecting human rights and the environment. By clearly defining criminal offenses and imposing severe sanctions, the EU strengthens its legal framework to ensure compliance with its restrictive measures.