The EU Adopts a Landmark Human Rights Sanctions Regime

Companies will soon need to address human rights in their compliance programs in light of the new global human rights sanctions regime,^[1] adopted by the European Union on Dec. 7, 2020.

This EU Regulation — which is directly applicable in EU Member States — targets individuals, entities and bodies, including state and non-state actors, responsible for, involved in or associated with serious human rights violations or abuses worldwide, including:

• Genocide
• Crimes against humanity
• Serious human rights violations or abuses, including torture, slavery, extrajudicial, summary or arbitrary executions and killings, enforced disappearance, arbitrary arrest or detentions
• Other human rights violations or abuses, such as human trafficking, sexual and gender-based violence, and abuses of freedom of peaceful assembly, expression and religion

The sanctions consist of:

• A travel ban for listed individuals
• An asset freeze for listed individuals/entities
• A prohibition on making funds or economic resources available to listed individuals and entities

Targeted sanctions can be imposed on those responsible for gross human rights infringements, or on anyone providing financial, technical or material support.

This new EU framework is inspired by the US Magnitsky Act, which was established under the Obama administration in 2012 in response to the death of a Russian tax lawyer who was allegedly killed in a Russian jail by Russian officials after uncovering a massive fraud scheme.

Several countries — including the UK and Canada — are now equipped with a Magnitsky-style sanction regime which also targets individuals and entities involved in human rights violations.

The EU’s new sanctions regime is a key milestone of the EU action plan on human rights and underlines EU’s determination to promote and protect human rights.^[2] By covering a greater scope than the existing specific EU regulations, this new European framework will, in particular, enable the EU to be more flexible and efficient when imposing sanctions for gross human rights violations.

In light of the EU’s new regime, as well as future EU legislation on mandatory human rights due diligence, organizations would be wise to begin considering human rights in their compliance programs.

^[1]  _{Council Regulation (EU) 2020/1998 and Council Decision (CFSP) of 7 December 2020 concerning restrictive measures against serious human rights violations and abuses.}

^[2]  _{EU Action plan on Human rights and Democracy 2020-2024, 25 March 2020.}