The EU's 21st sanctions package, adopted on 23 July 2026 under Council Regulation (EU) 2026/1848, introduces new restrictions across energy, financial services and crypto assets that directly affect companies using Kazakhstan as a transit or intermediary hub for trade with or through Russia. Businesses registered or operating in the Astana International Financial Centre (AIFC) and elsewhere in Kazakhstan are not subject to EU law as a matter of domestic obligation, but their EU-connected counterparties, correspondent banks and investors face liability for transactions that route circumvention through Kazakhstani entities. Understanding the exposure – and acting on it quickly – is material to continued access to European markets, finance and partnerships.
What the 21st Package Changes and When
The 21st package builds on a sequence of tightening measures that accelerated through the first half of 2026. The 20th package, adopted on 23 April 2026, introduced a ban on transactions involving the digital rouble and the RUBx instrument, effective from 24 May 2026. That development – and its particular relevance for payment flows using emerging Russian digital infrastructure – is analysed in our earlier alert on the digital rouble and RUBx ban.
Council Regulation (EU) 2026/1848, adopted on 23 July 2026, targets three sectors specifically:
- Energy: A ban on Russian LNG imports applies from 25 April 2026 for new and short-term contracts. Long-term contracts concluded before 17 June 2025 benefit from a transitional period and will fall within the prohibition from 1 January 2027.
- Financial services: Expanded restrictions on financial intermediation, correspondent relationships and settlement services connected to listed Russian entities.
- Crypto assets: Broader prohibitions on crypto-related services that could facilitate circumvention, extending obligations on exchanges, custodians and wallet providers with EU nexus.
Separately, the divestment derogation allowing EU persons to exit Russian assets has been extended to 31 December 2026, providing a limited window for structured exits that remain compliant.
The Kazakhstan-Specific Angle: Why Intermediaries Here Face Heightened Scrutiny
Kazakhstan occupies a specific position in the EU's circumvention enforcement focus. Regulators in Brussels and member-state authorities have consistently identified Central Asian jurisdictions – and Kazakhstan in particular – as geographic corridors through which restricted goods, financial flows and services reach Russia. This does not mean Kazakhstani companies are subject to EU sanctions as a matter of Kazakhstani law; it means that any entity with EU-connected ownership, funding, banking relationships or contractual partners is potentially exposed through those connections.
The best-efforts obligation under EU sanctions law requires EU operators to take reasonable steps to ensure their non-EU subsidiaries and partners do not engage in activity that would be prohibited if carried out by an EU person. A Kazakhstani subsidiary of a European group, a joint venture with an AIFC-registered fund backed by EU capital, or a trading company whose goods clear through EU ports all carry this residual exposure. Following the 21st package, EU operators are expected to conduct enhanced due diligence on Kazakhstani counterparties, particularly those involved in energy commodities, financial intermediation or digital asset services.
For companies operating under the jurisdiction of the AIFC Court or the AFSA (Astana Financial Services Authority), or resolving disputes through the IAC (International Arbitration Centre) in Astana, the procedural framework remains governed by AIFC rules. However, sanctions screening requirements imposed by EU counterparties and correspondent banks apply as a contractual and operational matter, irrespective of the governing law of the underlying transaction.
If your business operates in or through Kazakhstan and maintains EU counterparty relationships, correspondent banking lines or EU-connected ownership, the changes introduced by the 21st package warrant immediate review. Contact our team at info@ferrazwhitmore.com or visit our contacts page to discuss your specific exposure.
Who Is Affected in Kazakhstan
The following categories of market participant face the most direct operational risk:
- Trading and commodity intermediaries handling energy products, including LNG re-export or swap arrangements, where the supply chain involves Russian origin or offtake.
- Financial institutions and payment service providers with EU correspondent relationships that process transactions involving listed Russian entities or instruments now covered by the expanded financial services restrictions.
- Crypto exchanges, custodians and OTC desks registered or operating in the AIFC or under AFSA oversight, where EU-connected clients or liquidity providers are present.
- Subsidiaries and branches of EU-headquartered groups established in Kazakhstan for regional operations, where the best-efforts obligation binds the parent.
- Logistics and freight forwarding companies whose shipments transit EU territory or use EU-flagged carriers, particularly for dual-use or controlled goods.
- Fund managers and family offices with AIFC-domiciled vehicles and EU investor bases, who face asset freeze risk if investments connect to designated persons.
Export Controls and Sanctions Screening: Practical Implications
The 21st package reinforces the EU's export controls framework by strengthening the list of common high-priority items subject to outbound restrictions. Companies in Kazakhstan acting as re-exporters or distributors for EU-origin goods must assess whether their downstream customers include entities that could bring those goods into Russia. The practical threshold is not formal designation – it is whether a transaction, viewed objectively, serves to circumvent an existing prohibition.
Sanctions screening processes that were adequate six months ago may no longer be sufficient. The volume of newly designated entities, combined with expanded sectoral restrictions in energy and financial services, means that screening tools, counterparty questionnaires and contractual warranties must be updated to reflect the current list state as of July 2026 and the transitional dates described above.
For transactions involving LNG or related energy services, operators should specifically identify whether their contracts were concluded before 17 June 2025, as this determines whether the transitional period to 1 January 2027 applies or whether the 25 April 2026 entry-into-force date governs. This distinction has immediate cash-flow and contract-termination implications that require legal analysis rather than assumption.
Immediate Action Items for International Companies
Based on the measures now in force, we recommend that companies with Kazakhstan exposure consider the following steps as a priority:
- Map your EU nexus: Identify every point at which EU law could attach to your Kazakhstan operations – ownership, funding, banking, contractual counterparties, shipping routes and governing law clauses.
- Audit LNG and energy contracts: Determine whether any supply, offtake or intermediation arrangements involve Russian LNG and, if so, the date of conclusion relative to 17 June 2025 and the applicable transition timeline.
- Update sanctions screening: Refresh counterparty lists, ownership trees and payment-flow analysis against the consolidated EU sanctions list as updated following the 21st package adoption on 23 July 2026.
- Review crypto and digital asset exposure: Confirm that any digital asset services involving EU-connected participants comply with the expanded prohibitions, taking particular account of the earlier digital rouble and RUBx restrictions in force since 24 May 2026.
- Assess divestment timelines: If your group holds Russian assets and is considering an exit, note that the derogation window runs to 31 December 2026 and structuring a compliant exit requires time – beginning that analysis now is advisable.
Our sanctions and trade compliance practice in Kazakhstan advises companies at each stage of this process, from initial exposure mapping through to contract restructuring and engagement with relevant authorities.
Cross-Border Perspective: Coordination with EU Counsel
Many Kazakhstan-based intermediaries ultimately answer to European parent companies, investors or lenders whose own compliance obligations run under EU law directly. In these structures, Kazakhstan-side legal advice and EU-side legal advice must be coordinated. A position that satisfies AFSA guidance or AIFC Court-compatible contractual standards may still leave an EU parent exposed if the underlying transaction falls within the scope of Council Regulation (EU) 2026/1848.
Our firm's work across both jurisdictions – including sanctions and trade compliance in Portugal as an EU member state – allows us to provide consistent analysis that accounts for both the Kazakhstan operational environment and the EU legal obligations that bind the group as a whole.
To discuss how the 21st sanctions package affects your specific structure in Kazakhstan, reach our sanctions and trade team directly at info@ferrazwhitmore.com or submit your enquiry through our contacts page.
Disclaimer: This publication is provided for informational purposes only and does not constitute legal advice. The information herein should not be relied upon as a substitute for professional legal counsel tailored to your specific circumstances. Ferraz & Whitmore assumes no liability for actions taken or not taken based on the contents of this material. For advice regarding your particular situation, please contact info@ferrazwhitmore.com.