The White House stated that its partners and we were imposing sanctions in response to Russia’s invasion and occupation of Ukraine.
According to the White House, sanctions are “a response to Putin’s war against Ukraine” and “impose severe financial costs on Russia’s biggest financial institutions.”
Exports to Russia require that US companies obtain licenses for computers, sensors, and lasers. According to Reuters, almost all requests will be denied by the United States. “The new rules also require companies that make tech products abroad with US tools to apply for a US license before shipping to Russia,” Reuters wrote—noting that similar restrictions were previously in place for Chinese tech giant Huawei.
According to the White House, countries with substantially similar export restrictions are exempt from the new US licensing requirements. These sanctions are being imposed by the United Kingdom, Australia, Japan, and Canada.
Export restrictions for tech-related products
The White House stated that tech-specific sanctions target chips, security, telecom, etc.
Russia has placed restrictions across Russia to stop Russia from importing technological goods vital to its diversified economy and Putin’s ability to project its power. Russia will block all exports of sensitive technology. This is primarily for the Russian defense, aviation and maritime sectors. Russia cannot access cutting-edge technology. The United States government will place restrictions across Russia on sensitive US technology produced in other countries that use US-origin technology, software, and equipment. This includes restrictions on Russia’s semiconductors, telecommunications, encryption security, sensors, navigation, and maritime technologies. Russia will be unable to access cutting-edge technology due to these severe and persistent controls.
The White House stated that only specific military end-users would be allowed to export almost all US products and items made in other countries using US-origin technology, software, or equipment. These restrictions apply to the Russian Ministry of Defense and Russia’s Armed Forces wherever they may be found.
A Commerce Department fact sheet on the license rules said the US is imposing “a policy of denial” for license applications but will conduct case-by-case reviews for “applications related to the safety of flight, maritime safety, humanitarian needs, government space cooperation, civil telecommunications infrastructure, government-to-government activities, and to support limited operations of partner country companies in Russia.”
Russian banks are subject to severe sanctions.
Biden’s administration stated that it would “cut off Russia’s biggest bank from the US Financial System” and impose “full blocking Sanctions on Russia’s second-largest bank–freezing all of its assets touching US financial systems.”
More details were provided by the US Treasury Department on financial sanctions.
Russia’s invasion of Ukraine may cause problems for chip manufacturing. According to TechNet, Ukraine is a significant producer and supplier of neon gas that is critical for producing lasers in chipmaking. It also supplies more than 90% of US-grade neon. Russia provides about 35 percent of the palladium, also used in semiconductors. According to JPMorgan, Intel gets approximately 50 percent of its neon in Eastern Europe. This could lead to a full-scale conflict that would disrupt exports of these elements.