16 February 2024

Article 3n of Regulation (EU) 833/2014 prohibits EU operators from transporting Russian oil and petroleum products to third countries, unless they were purchased at or below the price cap. The price cap applies only to the purchase price of the goods, whereas ancillary costs (such as shipping, freight, customs and insurance) are not included in the price cap.

The price cap exception relies on a recordkeeping and attestation process that modulates actors’ compliance obligations on the basis of their access to the purchase price and allows each party in the supply chain to either demonstrate or confirm that the goods have been purchased at or below the price cap.

Until now, actors who do not have direct access to the price information in the ordinary course of business – such as shipowners, ship management companies and insurers (including P&I clubs) – had to obtain customer attestations in which their customer committed not to purchase Russian oil/petroleum products above the price cap. Customer attestations could be included in sanctions clauses or obtained as part of an annual insurance policy.

With the twelfth package of sanctions, adopted on December 18, 2023, the EU introduced new compliance requirements, aiming to further support the implementation of, and compliance with, the price cap mechanism and to increase barriers to falsification of attestations and inflated transport costs.

For Russian oil or petroleum products loaded on or after February 20, 2024, shipowners, ship management companies, insurers and insurance brokers shall:

• obtain customer attestations in which their customer commits not to purchase Russian oil and petroleum products above the price cap: unlike what has happened so far, such attestations should be collected per-voyage;
• require their counterparties to share information on itemised ancillary costs upon request and be able to share such information to the competent authorities or other counterparties upon request. The EU Commission suggested to embed such requirement in relevant contracts, for example incorporating an ‘access to records’ clause which would be activated if the actor needed to seek information about a particular voyage.