Ordinary Payment Not Automatically Subject to EU Sanctions Against Russia - German court overturns bank’s block on €37,000 Russia-linked payment
A German savings bank wrongfully blocked a €37,000 payment from a Russian company to a German firm. The Higher Regional Court in Frankfurt am Main has now ruled that the transfer did not breach EU sanctions. The case centred on whether routine transactions with Russian entities automatically violate restrictions imposed after Russia’s invasion of Ukraine. The dispute began when the savings bank refused to process the payment in February 2022. The Wiesbaden Regional Court later ordered the bank to release the funds, but the institution appealed the decision. The Higher Regional Court upheld the earlier ruling, confirming that the transaction was lawful. Judges clarified that standard business payments do not automatically fall under EU sanctions. They also noted that the Russian business partner was not listed on the EU’s sanctions registry, making the transfer permissible. No further details about the companies involved were provided in the court’s decision. The ruling sets a precedent for how banks handle transactions linked to Russia. Financial institutions must now verify whether specific entities are sanctioned before blocking payments. The decision does not affect broader restrictions on listed individuals or companies under EU law.
