The Sanctions Principles-Based Regulation: A Blueprint for a New Approach for the EU Sanctions Policy (Part I)

2.1. EU Sanctions as a Foreign Policy Instrument

Currently, the EU’s restrictive measures (sanctions) are an important foreign policy instrument. Initially, they were part of the Common Commercial Policy.^[39] As scholars point out, EU sanctions policy during this period had ‘a reactive character’ and it was characterised by the implementation of the United Nations (UN) sanctions.^[40]

The principles of political cooperation envisaged by the legislature were first reflected in the Single European Act (1986), which was the first major revision of the Treaty of Rome (1957), and incorporated proposals for political cooperation reflected in the reports noted above. The Single European Act underlined the importance of consultations, frequency of meetings, the responsibility of the presidency, meetings of political directors within political committees, and meetings of working groups.^[41]

These advancements in the development of European political cooperation formed the basis for the adoption of the Maastricht Treaty (1992),^[42] initiating the new stage in the EU sanctions policy development. The Treaty empowered the EU to adopt autonomous restrictive measures within the Common Foreign and Security Policy (CFSP) and introduced ‘a two-tier procedure for the adoption of the EU sanctions’.^[43] The provisions of the Maastricht Treaty also extended the scope of Article 228a on the movement of capital and payments.

202The next important stage in the formation of the regulatory framework for imposing EU sanctions is associated with the adoption of the Lisbon Treaty in 2007, which defined the basic principles and mechanisms of the CFSP and clarified the procedure for the adoption of restrictive measures.^[44] In particular, according to article 24(1) of the Treaty on European Union (TEU), the EU’s competence in regards of CFSP covers all areas of foreign policy and all questions relating to the EU’s security. The Treaty also anticipated the creation of the EEAS and the consolidation of the authorities of the High Representative for Foreign Affairs and Security Policy. Additionally, the Lisbon Treaty of 2007 clearly spelt out the economic and financial nature of restrictive measures. According to article 24 of the TEU, the EU’s ‘[CFSP] shall be defined and implemented by the European Council and the Council acting unanimously, except where the Treaties provide otherwise’. After that, the High Representative of the Union for Foreign Affairs and Security Policy together with the Commission draft a joint proposal to implement those measures. The Council then votes by a qualified majority on whether to adopt that joint proposal.^[45] Article 215(2) Treaty on the Functioning of the European Union (TFEU) also clearly specifies against whom sanctions may apply – legal or natural persons, non-state actors and groups.^[46] Interestingly, the EU treaties do not envisage the possibility of imposing sanctions against states.^[47] On 9 June 2022, the European Parliament, by a large majority, approved a resolution proposing amendments to the EU treaties, in particular, to change article 29 of the TEU in order to give the EU a new mechanism to designate countries as sponsors of terrorism.^[48] Thus, the principal EU treaties establish the foundations of the procedure of the adoption of sanctions within the CFSP.

203The basic aspects of the implementation and enforcement of sanctions are set out in the Council’s regulations separately in relation to each country against which sanctions apply. The Council’s regulations define the scope of the sanctions’ application, the main definitions for the implementation of sanctions, information sharing between competent authorities regarding sanctions, a ban on circumvention of sanctions, the issue of authorisation of the exemption from sanctions application and establishing liability for sanctions violation.

An analysis of the Council’s regulations on Iran, Syria and Russia shows that there is no unanimous approach to the implementation and enforcement of the EU sanctions; the EU sanctions policy on the core issues is inconsistent and grounded justifications for this are not provided. For instance, the requirements for the coordination of sanctions imposed on Iran and Syria are weaker than the requirements concerning sanctions against Russia. In particular, there is an obligation to exchange information between competent authorities of the EU Member States regarding frozen funds Council’s regulations on Iran and Syria but in these Council’s Regulations there is no requirement to share information about economic resources as in Council’s Regulation on Russia. Furthermore, there is no requirement in the Council’s regulations on Iran and Syria to exchange information with enforcement authorities and administrators of official registers.^[49] Additionally, until recently, the obligation to impose criminal sanctions for violations of restrictive measures has been required only against Russia but not against other sanctioned countries.^[50] Similarly, the pos204sibility of confiscation of the proceeds for sanctions violation is envisaged only in the relation to sanctions against Russia but not Iran or Syria.^[51]

An important role in the development of the EU sanctions policy is played by the EU soft-law instruments on sanctions.

On 3 December 2003, the Council of the EU introduced the first Guidelines on implementation and evaluation of restrictive measures (sanctions) in the framework of the EU Common foreign and security policy (hereafter, ‘the Guidelines’).^[52] This document contains standard wording and common definitions that may be used in the legal instruments when restrictive measures are implemented by the EU and its Member States.^[53] The purpose of the Guidelines is to ensure uniform application of restrictive measures. This document also addresses a number of general and specific issues on the imposition, implementation and supervision of restrictive measures, including the application of principles for imposing restrictive measures (legality, proportionality, respect for human rights, effectiveness, and coordination). Particular attention is devoted to the objectives of imposing sanctions and the necessity of their clear statement for each restrictive measure.^[54] This document contains recommendations on the most effective and successful mechanisms for the implementation of both the UN and EU autonomous sanctions. The Guidelines was reviewed and updated in 2005, 2009, and 2018 but the changes to it had fragmented nature.

Another significant policy development is the Basic Principles on the Use of Restrictive Measures (Sanctions) (hereafter, ‘Basic Principles’) adopted in 2004,^[55] which laid the strategic foundations for the application of restrictive measures. The academic literature pays some attention to the interesting fact that the fundamental principles on the application of restrictive measures were 205adopted after the Guidelines; however, it should be the other way around.^[56] This document clearly states that restrictive measures are a key instrument of the EU foreign policy; the goals of the application of restrictive measures are also defined. The document also envisages the possibility of the application of two types of sanctions: the UNSC sanctions and autonomous European sanctions. As the Guidelines, the Basic Principles envisage a targeted sanctions approach. The Basic Principles envisage such principles as legality, effectiveness, proportionality, international cooperation and respect for human rights.

In 2005 there were also published EU Best Practices for the effective implementation of restrictive measures (hereafter, ‘Best Practices’) have been published.^[57] The Best Practices are ‘non-exhaustive recommendations of a general nature’ for effective implementation of restrictive measures in accordance with the applicable Union law and national legislation’.^[58] In particular, they contain recommendations on the designation and identification of persons and entities subject to targeted restrictive measures, delisting of sanctioned persons, recommendations for third parties, which are obliged to comply with sanctions, use of information by competent authorities, implementation of freezing of funds and the issues of cooperation and coordination of sanctions. The EU Best Practices were reviewed in 2007, 2008, 2015, 2016, 2018 and 2022, but the changes to them, as in case of the Guidelines, have a fragmented nature.^[59]

Since the adoption of these documents, there has been a significant growth in the use of sanctions, their diversity and complexity, and the role of the EU as the main sanctions player has increased. However, these changes are not properly reflected in the soft-law policy instruments considered.

These three sanctions policy documents laid down foundations for the EU sanctions policy. Despite significant advancements in the development of the EU sanctions policy in the above-mentioned policy documents, as Druláková et al. aptly noted, given that they are soft-law instruments, they do not create any real restrictions for EU sanctions policy.^[60] Also, inconsistency between these docu206ments exists, the Guidelines and Best Practices have been constantly changed, these changes mainly reflect the developments in the Court of Justice of the European Union (CJEU) case law on sanctions policy. However, these piecemeal changes had fragmented nature. In contrast to the Guidelines and Best Practices, there have been no changes to the Basic Principles despite the urgent need in them. Currently, principles of sanctions policy are dispersed among different legal acts, also, there is no basic interpretation to all of them provided as well as there is a little clarity on how to understand the basic concepts. Additionally, there is an imbalance between the development of sanctions and the EU sanctions regulatory framework; for instance, new and more complex sanctions such as price cap are envisaged, however, the specifics of the adoption procedure of such sanctions are not set out. In fact, rather than being systemic, the applied approach is one of ‘patching holes’; as such, the development of the EU sanctions policy has rather a reactive rather than forward-looking character.

Thus, the EU restrictive measures have been significantly evolved from being used within the common commercial policy framework and implementing mainly the UN sanctions to getting used within the foreign policy framework and implementing both the UN sanctions and EU autonomous sanctions. The main focus of the EU sanctions regulatory framework is on sanctions decision-making and there is a little attention paid to the implementation and enforcement of sanctions. In view of the strong criticisms of the ineffectiveness of EU sanctions, there are a number of areas of concern: the lack of a uniform approach to the implementation and enforcement of sanctions, the absence of a forward-looking approach to sanctions policy, an imbalance between the development of sanctions and the sanctions regulatory framework, and a soft approach to the adoption, implementation and enforcement of sanctions.

2.2. EU Sanctions against Russia

The crucial moment in the development of EU sanctions policy was the application of the EU sanctions against Russia. It is important to investigate the EU sanctions imposed on Russia, as they are one of the most comprehensive in EU sanctions history^[61] and they are imposed on a country, whose economy is highly integrated into the world economy.^[62]

207Currently, Russia is ‘the most-sanctioned country in the world’^[63] with 13 596 sanctions in place as of 17 January 2023 according to Statista,^[64] and their number continues to increase. Noteworthy is the speed of imposing sanctions on Russia: in the period from 23 February 2022 until 23 June 2023 eleven sanctions packages were imposed;^[65] the number of sanctions against Russia exceeded the number of sanctions against Iran for over the last 40 years.^[66]

At the same time, the question arises as to how effective are the sanctions introduced against Russia are. Is it possible to talk about the success or failure of the sanctions in terms of the achievement of the sanctions’ goals?

Russia has been under international scrutiny since 2014 due to its violation of Ukraine’s sovereignty and territorial integrity by the Russian armed forces and the illegal annexation of Crimea and Sevastopol. The Council of the EU first addressed the issue by officially condemning the country’s actions and the holding of an illegal referendum in Crimea;^[67] this was followed by the imposi208tion of EU sanctions.^[68] In the case of Iran, sanctions against an internationally coordinated response to its nuclear proliferation programme and consisted of both the UNSC sanctions and bilateral actions led by the US and the EU and other countries. By contrast, sanctions against Russia are mainly led by the US and the EU and their strategic partners (the UK, Canada, Australia, and Japan);^[69] the UNSC could not overcome the veto of Russia and impose sanctions against it^[70] and only condemned the breach of the Ukrainian sovereignty and annexation of Crimea in a non-binding resolution.^[71]

Initially, in 2014 the European Union imposed sanctions focused on Russian individuals and entities, responsible for the illegal annexation of Crimea and Sevastopol, including individuals and entities controlled by those actors.^[72] During the period from 2014 until 2021, the listing criteria for inclusion in the sanctions list were expanded to include not only persons and entities, responsible for the illegal annexation of Crimea and Sevastopol but also for the breach of the territorial integrity in the Donbas region of Ukraine; those who facilitated by their actions to the undermining of the territorial integrity of Ukraine (materially or financially supported it; conducted transactions with the separatist groups in the Donbass region of Ukraine; transferred their ownership in Crimea or Sevastopol contrary to Ukrainian law, or who have benefited from such a transfer; undermined the work of international organisations 209in Ukraine).^[73] As a result of these measures, the number of the sanctioned persons, whose assets should be frozen, increased six times: from 33 sanctioned individuals as of 21 March 2014 to 203 sanctioned individuals and 51 entities as of 13 December 2021. The list of categories of sanctioned persons has significantly evolved. In 2014, sanctions were imposed on political representatives, government officials and military commanders of Russia and Crimea, which supported the annexation of Crimea. Later they came to cover a greater number of government and military officials who supported not only the annexation of Crimea, but also the creation of Lugansk and Donetsk republics, paramilitary organisations, separatist groups, propagandists, oligarchs, and entities that exercise their activities on the territory of the illegally annexed Crimea and Sevastopol and Russia and others.^[74]

This period is characterised by the application of the mainly classic targeted sanctions (visa bans and asset freezes and a prohibition on providing funds to individuals and legal entities) and some sectoral sanctions – arms embargo and restricting export of the dual-use goods and technologies for military use, other trade (related to oil exploration and production) and investment restrictions imposed on major credit institutions or financial development institutions established in Russia with over 50% public ownership or control.^[75]

Despite the expansion in sanctioned persons and legal entities, and listing criteria, at this stage, the sanctions against Russia did not impact significantly the industries, which bring significant input to the Russia’s budget and GDP; in 2019, sanctions caused an annual decline in the economic growth of Russia of 210around –0.1% per year.^[76] As previously noted, scholars call this period of sanctions against Russia – the period of the ‘symbolic’ sanctions.^[77]

Council’s regulations on the implementation of sanctions on Russia did not contribute much to the effective implementation and enforcement of sanctions during this period of their imposition. On the one hand, the violation, including circumvention of sanctions was forbidden. However, while the EU sanctions regulations established liability for violation of sanctions, there was no requirement to criminal liability for violation of sanctions.^[78] As a result, only twelve states have established criminal sanctions, and these sanctions varied significantly,^[79] which, in turn, facilitated regulatory arbitrage and negatively impacted the effectiveness of sanctions compliance. The scope of requirements to coordination of sanctions was quite narrow, relating mainly to information sharing, for example, on accounts and frozen assets, authorisations granted etc.^[80]

The year 2022 marked a significant shift in EU Russia sanctions policy. In the legal literature, this sanctions period is referred to as a ‘sanctions tsunami’.^[81] As Russia started the full-scale invasion of Ukraine, the EU unprecedently increased the number, diversity and severity of sanctions against Russia; up to date the EU has imposed eleventh packages of sanctions on Russia. The EU continued the expansion of the listing criteria for the sanctioned persons and legal entities to cover those responsible for the full-scale Russia’s invasion of Ukraine and their close relatives, those who facilitated such invasion, those who provided significant revenue to the Russian budget, and those who facilitated sanctions evasion.^[82] The list of categories of sanctioned persons signifi211cantly evolved, covering a wider number of top political representatives and government officials (including from Belarus), oligarchs, and military personnel, including from Belarus, Iran and Syria for the facilitation of the Russia’s invasion of Ukraine.^[83] As of 28 February 2022, the assets of 696 individuals and 56 entities should be frozen; as such, in the first days after the start of the full-scale Russia’s invasion of Ukraine, the number of only asset freezes increased three times. As of 15 March 2023, the number of sanctions targets, whose assets should be frozen, had expanded to cover 1499 individuals and 209 entities.^[84] Thus, compared to 2021, by the end of October 2022, the number of sanctioned individuals, whose assets should be frozen, increased almost 7,4 times and the number of sanctioned entities increased four times. Notably, the variety and severity of sanctions also increased after the full-scale Russia’s invasion of Ukraine. Before 2022, the measures imposed were mainly classic targeted sanctions (visa bans, freezing of assets and prohibition to provide funds), alongside arms embargo, and some trade and investment measures. By contrast, after 2022, already imposed sanctions were strengthened and the new sectoral sanctions were introduced: (a) in the military sector, greater restrictions of the export of the dual-use military products have been imposed; (b) in the financial sector, sanctions were imposed on the Russian central bank, transactions in Euro and other monetary restrictions, and a range of Russian banks were excluded from SWIFT. Prohibitions were introduced on providing credit rating services, opening crypto-wallets to Russian nationals and entities and accepting any deposits from Russian nationals or natural persons residing in Belarus, or legal persons, entities or bodies established in Russia in the amount exceeding EUR 100 000; (c) investment restrictions were imposed on the Russian Direct Investment Fund, and the Russian energy sector; (d) export and import trade restrictions were imposed on natural resources (iron, steel, coal and other solid fossil fuels, crude oil, petroleum products, gold etc.) and luxury goods); (e) restrictions were instituted on propogandist media abroad; (f) transport restrictions were imposed, including a ban on all Russian vessels from accessing EU ports and on Russian and Belarusian road transport operators from entering the EU. In addition, a new and more complex type of sanctions – price cap mechanism for the Russian oil was introduced.^[85] Thus, this period of imposition of sanctions against Russia is characterised by the application of the classic targeted sanctions but with a significant increase in the role of sectoral sanctions (e. g., the partial embargo on crude oil and petroleum products), which are in their nature closer to comprehensive measures than to tar212geted sanctions. In fact, sectoral sanctions target the military and other sectors facilitating the Russian military aggression and bringing a significant inflow to the budget and, thereby, financing the war. EU sanctions continue to strengthen, and their escalation is ongoing. In particular, on 23 November 2022, the European Parliament adopted a resolution recognising Russia as a terrorist state and calling for the establishment of an ad hoc international tribunal to investigate and prosecute Russian crimes of aggression against Ukraine and ensure strict enforcement of all sanctions, to actively prevent, and further addressing any circumvention of the sanctions.^[86] In this period, there was increasing sanctions decision-making and enhancing requirements for the implementation and enforcement of sanctions. In particular, coordination of sanctions has been strengthened, including mechanisms for revealing the assets of the sanctioned persons have been improved, the obligation to exchange information between competent authorities of the EU Member States, including enforcement authorities and administrators of official registers have been envisaged, a ‘Freeze and Seize Task Force’^[87] and the international Russian Elites, Proxies, and Oligarchs ‘REPO’ Task Force^[88] have been set up as well as transatlantic cooperation on sanctions between the EU and US,^[89] compliance guidelines for the third parties who are required to implement sanctions have been developed in some countries, and criminal liability for sanctions violation has been established at the EU level.^[90]

In this period, the sanctions imposed were not ‘symbolic’; they impacted the Russian GDP and the negative impact on the Russian economy continues. However, the negative implications were not so devastating for the Russian economy as from ‘tsunami’, with which this period of sanctions is compared. 213Their significant negative impact on the Russian economy can be explained by the strengthening and broadening of sectoral sanctions. The effectiveness of these sanctions is much greater compared to the sanctions imposed before the full-scale Russia’s invasion of Ukraine, their impact on the Russian economy is significant but not sufficient as they did not reach their main goal – stopping the war against Ukraine.

The analysis of the effectiveness of the EU sanctions policy against Russia shows significant progress in imposing, implementing and enforcing sanctions but a range of shortcomings are inherent to the sanction process, negatively impacting the effectiveness of sanctions against Russia.

First, the application of sanctions looks chaotic, and there seems to be no strategic approach to their application, and no clear criteria on whom and when the EU imposes sanctions. For instance, after the annexation of Crimea until the full-scale Russia’s invasion of Ukraine there have been exemptions from the arms embargo – sanctions did not cover contracts concluded before 1 August 2014, and there was no strict ban on the trade by products of the dual use; as a result, a number of the companies, which produced products for military purposes were not covered.^[91] Interestingly, according to experts, some Russian military companies producing missiles are not covered even after the full-scale invasion of Russia in Ukraine.^[92] Another example of EU sanctions policy being inconsistent is that, on the one hand, the EU targets with its sanctions industries that contribute substantially to Russia’s revenues, but, on the other hand, some industries, which bring significant income to Russia, are not covered.^[93]

Second, there is no sufficient attention to the risks, which are inherent to the sanctions process, for instance, to the risk of sanctions evasion. This risk is not incorporated properly in the sanctions policy-making process. For instance, as 214a result of the absence of the definition of Russian oil or petroleum products or other norms (which would prevent circumvention of the oil embargo), in the initial version of the decision of the Council of the European Union 2022/884 of 3 June 2022, the practices of blending Russian oil with oil from the third country in order to change the country of origination of oil (so-called ‘renaming of the oil’ strategy) could exist.^[94] Interestingly, blending crude oil is a well-known way to circumvent oil embargo sanctions and was used earlier by other sanctioned countries. It would be reasonable to take into consideration this form of sanctions evasion when designing the implementing regulation for the embargo on Russian crude oil and petroleum products. The problem of the circumvention of sanctions by means of the mixing oil was partially resolved by issuing a ‘Notice to operators Imports of Russian crude oil or petroleum products into the Union 2022/C 296/05’ of 3 August 2022, which forbids the import of Russian crude oil into the EU in a mixed form.^[95] However, it is not fully clear whether this ban applies to the petroleum products produced from Russian oil in third countries; in fact, the ways of circumventing the petroleum products embargo are not fully removed.

Third, the existing mechanisms do not provide effective implementation and enforcement of sanctions against Russia. First of all, until recently there was no obligation for the EU Member States to impose criminal liability for sanctions violations. As a result, some EU Member States had very low criminal sanctions or did not impose any criminal liability for breach of sanctions. It was only on 28 November 2022 that the Council of the EU in its decision identified the violation of sanctions as a crime at the EU level. However, even after this legislative change, the implementation of sanctions may be quite diverse across the EU Member States as there are no minimum requirements for criminal sanctions. Also, there are no legislative constraints against Russia’s trade diversion and evasion of the EU sanctions through third countries that did not join the EU sanctions regime.

215Thus, despite the significant improvement of the sanctions decisions and implementing regulations on Russia, sanctions against Russia have not still attained their main goal. The shortcomings of the sanctions policy against Russia are a result of the shortcomings inherent to the overall EU sanctions policy, when it seems there is no strategic approach to the application of the sanctions, and the regulatory framework, which shapes it, is ineffective; the changes to the sanctions policy and regulatory framework have a fragmented character, and the overall approach to the sanctions policy is reactive (corrective actions) rather than a precautionary forward-looking (which includes ex-ante planning). As a result, there is a need for the development of a new systemic approach to the EU sanctions policy.

2.3. Recent Regulatory Initiatives on Sanctions in the EU

During the last several years, the need to enhance the effectiveness of the implementation and enforcement of the EU sanctions has been actively discussed.

The Communication ‘The European economic and financial system: fostering openness, strength and resilience’of 19 January 2021 proposed a range of steps for this purpose: the creation of the Sanctions Information Exchange Repository, the establishment of a single contact point for enforcement and implementation issues with cross-border dimensions, and ensuring that EU funds and economic resources provided to third countries, international organisations and international financial institutions, which are not used in violation of EU sanctions.^[96]

With the increasing aggression of Russia against Ukraine this issue arose with the new force as sanctions against Russia were highly criticised for their ineffectiveness. On 25 May 2022, the European Commission also issued several legislative proposals directed at establishing a harmonised approach to criminal penalties for violation of the EU sanctions^[97] as well as envisaging the possibility of confiscation of the assets for sanctions violation.^[98]

216The European Commission first proposed to add the violation of EU sanctions to the list of EU crimes and harmonise criminal sanctions for violations of the sanctions across the EU on 25 May 2022 in its Communication from the Commission to the European Parliament and the Council ‘Towards a Directive on Criminal Penalties for the Violation of Union Restrictive Measures’.^[99] The motivation of the European Commission for the adoption of this regulatory proposal was, first, the need to criminalise breaches of the restrictive measures across all EU Member States because, as of 2021 only twelve Member States criminalised them;^[100] second, the need to provide unanimity in definitions and a system of punishment among the EU Member States. For instance, in fourteen Member States, the maximum length of imprisonment is between two and five years; in eight Member States, maximum sentences between eight and twelve years are possible. There is also a big difference in the amount of the maximum fine that can be imposed for the violation of sanctions in the different Member States.^[101] On 22 November 2022, the Council added the violation of restrictive measures to the list of EU crimes,^[102] but the definition, criminal sanctions and other issues are not harmonised yet. On 2 December 2022, the European Commission issues a Proposal of a Directive on the definition of criminal offences and penalties for the violation of Union restrictive measures.^[103] This Commission’s Proposal contains a range of important regulatory changes. In particular, it proposes not only envisage criminal liability for the above-mentioned breaches of restrictive measures committed both by natural and legal persons but also to approximate penalties applicable to legal persons, give precise definitions of various criminal offences related to violations of Union restrictive measures, envisage the list of aggravating circumstances, which should be taken into account when penalties are applied for an offence, harmonise some aspects of coordination and investigation of sanctions violations, and to broaden significantly a provision on jurisdiction rules.^[104] This Commission’s proposal is a significant step forward towards making sanctions more effective 217and resolve the issue of regulatory arbitrage, which exists now. In the legal literature, it is fairly remarked that the adoption of such a regulatory proposal would bring the EU closer to the US sanctions regime.^[105] Nevertheless, the proposed approach is modest; it proposes limited harmonisation of the implementation and enforcement of EU sanctions.

In addition, the European Commission developed a Proposal for a Directive of the European Parliament and of the Council on asset recovery and confiscation (2022) to reinforce its rules on the urgent freezing, recovery and confiscation of assets. The motivation for developing this Directive was the wish to strengthen the capabilities of competent authorities to identify, freeze and manage assets, reinforce and extend confiscation capabilities to cover all relevant criminal activities carried out by organised crime groups and improve cooperation between all authorities involved in asset recovery.^[106] Margaritis Schinas, vice president of the European Commission, also said that the existing rules for freezing and confiscating assets ‘are fragmented and not implemented in a uniform way’, what makes sanctions evasion easier.^[107] The proposed Directive on asset recovery and confiscation envisages ensuring asset tracing investigations with a view to facilitating cross-border cooperation, the obligation of the Member States to establish at least one asset recovery office, which would have direct access to and use the Secure Information Exchange Network Application (SIENA) system for exchanging information, the obligation of Member States to adopt a national strategy for asset recovery, the possibility of confiscation of the assets for a wider set of crimes, including criminal violations of EU restrictive measures, application of the non-conviction-based confiscation, including confiscation of unexplained wealth when wealth derives from criminal activities, even if it cannot be linked to a specific crime or the accused cannot justify the legal origin of property that does not match their official income.^[108] On 3 June 2022, the Council of the EU obliged Mem218ber States to introduce appropriate measures to ensure possibility of confiscation of the proceeds for violation of sanctions against Russia.^[109] The proposed Directive on asset recovery and confiscation will go further and ensure stricter punishment for violation of sanctions imposed by the EU against all sanctioned countries and will introduce a unified approach to freezing and confiscating assets.

Thus, during the last two years, there have been significant steps taken to make EU sanctions a more effective foreign policy instrument. The proposed approach to the EU sanctions policy is much broader than is currently the case, as it tries not to solve certain problems in relation to the sanctions regime of the specific country but to cover a spectrum of issues related to sanctions implementation and enforcement and the possibility of introduction of a unified approach, which could be applicable to all sanctions regimes. Also, there has been a significant strengthening of the EU sanctions policy, following the example of the US, to make sanctions hard law tools. Nevertheless, the proposed approach of the limited harmonisation of the EU sanctions policy will not fully solve the problem of making sanctions more effective foreign policy instrument and there is a need for consideration of a broader approach to the reform of EU sanctions policy.

3.1. Harmonisation of the EU Sanctions Policy

While the procedure of the adoption of the EU sanctions belongs to the competence of the Council of the EU and the EU law regulates it, the implementation and supervision, including enforcement of EU law on restrictive measures, are left to the EU Member States. It is worth noting that the implementation, supervision, including enforcement of sanctions, diverge among the EU Member States.^[110] The existing enforcement system of sanctions where the Member States apply divergent procedures, and impose divergent sanctions for 219violation of sanctions and remedies administered by various actors showed its ineffectiveness.^[111] According to the Genocide Network (2021), ‘the number of enforcement actions within the EU during the past few years remains minimal’.^[112] In response, the European Council adopted criminal liability for sanctions violation and European Commission developed two proposals regarding the harmonisation of definition of criminal offences and penalties for the violation of Union restrictive measures and confiscation of assets for sanctions violation. In my view, the proposed Commission’s proposals are narrow.

To make the EU sanctions policy more effective, the harmonisation of the EU sanctions policy should be broad-based and cover all the stages of the sanctions’ policy cycle (design, implementation, and supervision, including enforcement).

A broad-based harmonisation of sanction policy is needed. First, this will improve the effectiveness and speed up the process of sanctions implementation. For instance, severe criminal sanctions for violation of sanctions will not be enforced if the enforcement authority does not have uniform and adequate powers to enforce of sanctions. Second, it will tackle the problem of the regulatory arbitrage, which may exist in case of the divergent requirements to sanctions implementation and enforcement across countries. Third, it will reduce transaction costs of the implementation and enforcement of sanctions. Transaction costs will be high if sanctions are not implemented properly due to some procedural differences among the EU Member States. Reducing these transaction costs is particularly important as they impact not only sanctioned countries but also the country-sender of sanctions.

A three-tier harmonisation of the EU sanctions policy is needed that should cover the following: first, procedures (investigatory powers, monitoring of sanctions implementation), mechanisms (EU sanctions database) and the rights of the parties involved in the sanction process, including access to information, second, penalties (not only criminal, as it currently proposed but also administrative), and, third, institutional structure for the implementation and enforcement of sanctions.

220 Harmonisation of sanctions’ procedures, mechanisms and rights

The Commission’s proposal on the definition of criminal offences and penalties for the violation of Union restrictive measures envisages harmonisation of some procedural rules, which relate to coordination and cooperation of sanctions within Member States, including exchange and share of information, consultations on investigations and development of the investigative tools, exchange of best practices, whistle-blowing mechanisms, and cross-border cooperation between Member States and with the EU institutions (Europol, Eurojust, the European Public Prosecutor’s Office, and European Commission). The deficiency of the Commission’s proposal is that it takes exceedingly narrow approach to harmonisation of the EU regulatory framework for sanctions. In this regard, in the scholarly literature, it is aptly noted that there is a lack of attention to the stage of prosecution.^[113] I believe that EU harmonisation should also have a broader scope in regard of supervision of sanctions implementation and enforcement. Another shortcoming of the Commission’ approach is lack of clarity regarding how harmonisation on the listed issues will occur. In this regard, the more specific recommendations of the Dutch National Coordinator deserve attention, particularly, to issue at the EU level clear parameters for the investigation of sanctions, to develop a uniform EU approach on the ownership structures and interpretation of the grounds for granting exemptions, to create a central reporting point for freezing shareholdings and shareholder rights in legal persons held by sanctioned persons, to improve the process of publishing of sanctions at the EU level, and to develop a stronger legal basis at the EU level for the sharing of data etc.^[114]

Harmonisation of the sanctions’ penalties

Scholars also aptly note that it is important to consider whether ‘Member States may implement administrative sanctions enforcement regimes parallel to the EU-mandated criminal regime’.^[115] Harmonisation of not only criminal sanctions but also administrative sanctions for violation of sanctions is highly needed. Currently, there is a lack of criminal investigations and prosecutions; 221in practice, very few individuals or legal persons responsible for the violation of the EU sanctions are effectively held accountable. The administrative sanctions applicable for violation of sanctions do not apply in some EU Member States and in those they do, they differ substantially.^[116] As in the case of the enforcement powers and rights, this may lead to regulatory arbitrage and high transaction costs. It is also worth noting that sanctions infringements cannot lead to a criminal offence in all cases. The intervention of criminal law must, as in any other area, be exceptional and sanction only the most serious infringements. Even administrative sanctions must only be imposed in cases of negligence or intentional infringements, and when certain thresholds of evaded duties, lower than those reserved for criminal acts, are met. Under the proposed regime of harmonisation of administrative sanctions, every EU Member State would be obliged to furnish its national authorities with common administrative sanction powers and to establish common criteria for determining the type and level of administrative sanctions that should apply.

Harmonisation of the sanctions’ institutional structure

Legal scholars have already considered the need for reform of the institutional structure of the bodies responsible for the EU sanction process to boost the effectiveness of the existing system of the implementation and enforcement of the sanctions.

At the EU level, the legal reform of the sanctions institutional structure has been initiated. In particular, it is proposed that the Anti-Money Laundering Authority (AMLA) should be empowered to monitor and support the implementation of asset freezes under the sanctions’ regimes across the EU, and to develop draft regulatory technical standards, draft implementing technical standards, guidelines and recommendations, in the specific cases.^[117] In fact, it is proposed that the AMLA be empowered with competences similar to those of OFAC^[118] in relation to AML/CFT cases;^[119] but in relation to the sanctions it is proposed that AMLA be given narrower competence.

222The legal literature also contains proposals of several models for the reform of the sanctions institutional structure. These proposals can be divided into several groups.

The first set of proposals concern the creation of a centralised agency on the sanctions’ enforcement at the EU level. In the legal literature in this regard, several proposals have been suggested. First, establishment of an agency similar to the US OFAC in the EU is proposed; this proposal was made by the French minister of the Economy, Finance and Recovery Bruno Le Maire (2018).^[120] The second, is the possibility of the establishment of a European Sanctions Enforcement Authority (de Vries, 2021). Nevertheless, the scholar does not clearly specify how the model of the proposed authority should be built noting only that while the enforcement of the EU laws is within the competence of the EU Member States, in a number of other policy areas than EU sanctions show that certain direct enforcement competencies can better be exercised at the EU level (the European Banking Authority and the Data Protection Authority).^[121]

The second set of proposals concerns the creation of an authority similar to the OFAC at the level of the EU Member States and centralized authority for the secondary sanctions’ enforcement. Geranmayeh and Lafont Rapnouil (2019) propose the creation of a version of OFAC at the level of the EU Member States along the lines of the pan-European enforcement authority to combat money laundering and to create a pan-European organisation to help European companies respond to secondary sanctions imposed by third countries.^[122] In this regard, it is pointed out that the UK set up an Office of Financial 223Sanctions Implementation (OFSI) – a centralised agency dealing with the implementation and enforcement of sanctions.^[123]

It appears that the first academic proposals on the reform of the sanctions institutional structure appeals to one-tier reform (at the EU level); the second appeals to two-tier reform (at the EU level and at the level of the EU Member States).

In my view, the preferable approach is the creation of a two-tier sanctions institutional structure in the EU. This would include the creation of a centralised authority on sanctions enforcement similar to the EU AMLA, but without enforcement powers, and creation of the coordination authority (the national coordinator / Commission) at the level of each EU Member State, similar to that in the Netherlands and Lithuania,^[124] that could coordinate a wide number of institutions involved in the implementation and enforcement of sanctions.^[125] The coordination authority should be established on the permanent basis as it is recommended in the report of the National Coordinator for Sanctions Compliance and Enforcement.^[126]

The need for the implementation of such an institutional structure can be explained by the following reasons.

First, it is essential to address the current shortcomings in sanctions supervision and enforcement across the EU: sanctions enforcement within the EU currently takes place at the level of Member States. Its quality and effectiveness are uneven, due to significant variations in resources and practices across Member States. As recent studies of the EU sanctions show, the enforcement of sanctions is not consistent.^[127] Also, given the increasing number of sanctions, the frequency of their use and their complexity, it is preferable not to strengthen powers of the European Commission but to centralise enforcement powers and to transfer these powers to a separate authority at the EU level.

224Second, it is not possible to agree with the proposed model of a centralising agency similar to the US OFAC in the EU (as proposed by the French Minister of the Economy, Finance and Recovery Bruno Le Maire (2018)).^[128] Scholars have fairly pointed out why this model should not be accepted. First, the OFAC model does not fully fit the EU. OFAC is a federal agency that, apart from its federal legislative, investigative and adjudication competencies, has enforcement powers across the USA; the EU was built in another way that resembles the German Bundesstaat, where ensuring compliance with the federal laws is mainly entrusted to the Bundesländer.^[129] Second, the establishment of an agency similar to OFAC at the EU level is difficult to accomplish in the short to medium term as the enforcement competences, which are inherent to OFAC, currently belong to the EU Member States and transferring such competences may take time; the establishment of a European OFAC can only be a ‘part of a long-term vision’.^[130]

Third, the approach that underlies model proposed by the European Commission in 2021 is too narrow; it will not provide consistency in the sanctions enforcement across the EU. Under this proposal, the AMLA is empowered to monitor and support asset freezing under EU sanctions across the EU, including the issuance of draft technical standards and guidelines and recommendations in this relation.^[131] There is also no sense to create a pan-European organisation to help European companies respond to secondary sanctions imposed 225by third countries^[132] as this authority is empowered with too narrow competence.

Fourth, in order to boost the efficient functioning of the sanctions’ implementation, there is a need for the establishment of a centralised authority for the enforcement of sanctions with broader competencies, which would also include competencies regarding the secondary sanctions.

Given the cross-border nature of the assets and economic resources, the new EU sanctions authority is expected to make a strong and useful contribution to the detection of the assets of the sanctioned individuals and entities. Among other tasks, it could contribute to the harmonisation and coordination of sanctions-related investigations, and the direct supervision of implementation of sanctions by high-risk and cross-border sanctioned individuals and entities. To bring sanctions implementation, supervision, including enforcement, to an efficient and uniform level across the Union, it is necessary to provide the EU Sanctions Authority with the following powers: monitoring, analysis and exchange of information concerning sanctions risks affecting the internal market; and coordination and oversight of the Member States’ enforcement authorities. Other functions could be administering the database for sanctions enforcement cases and developing unified draft technical standards, guidelines and recommendations for implementation and enforcement of sanctions.

The AMLA could serve a prototype for the EU sanctions authority and could be empowered with similar functions, except for the enforcement. There is no need to transfer the enforcement function to the EU centralised sanctions authority,^[133] doing so would require approval by all EU Member States, which could take years and require changes to a great number of laws. For this reason, the function of the sanctions’ enforcement should be exercised by the EU Member States; however, the development of unified standards on sanctions implementation and supervision, including enforcement among the EU Member States, is needed.

Currently, the enforcement of the EU sanctions is dispersed across multiple authorities in each Member State. There is a great need for coordination and cooperation among all these authorities. In the Netherlands and Lithuania, such coordination institutional structures (national coordinator/commission) 226have been recently implemented and shown their effectiveness. Also, the creation of the OFSI or the Federal Authority for Fighting Financial Crime will not solve the problem of coordination as this organisation is responsible for the enforcement of only financial sanctions.

Thus, there is a high need for broader harmonisation at the EU level of the sanctions’ procedures, mechanisms and rights, penalties for sanctions violation (both criminal and administrative), the sanctions institutional structure at the EU level and the establishment of a coordination committee at the level of each EU Member State to improve the effectiveness of the EU sanctions policy.

3.2. The Risk-Based Approach to Sanctions

Addressing sanctions risks has perhaps never been more important than it is now. The sanctions risks, competent authorities and third parties, who are required to comply with the sanctions, face, have become more complex, fueled by the enhanced scope and diversity of imposed sanctions. Risks in sanctions policy, if ignored or not properly handled,^[134] negatively affect the effectiveness of the sanctions policy, the business of persons who are required to comply with the sanctions and also have negative impact on the EU economy as well as a global economy.

Nevertheless, the application of the risk-based approach (RBA) in the current EU regulatory framework on sanctions is limited. It is envisaged application of the RBA in a limited number of cases by the EU authorities when facilitating to sanctions implementation (when making exemptions from the freezing funds and economic resources, in investigations^[135]) and by individuals and legal entities in sanctions compliance. The latter is relatively more developed. In particular, for individuals and legal entities required to comply with the sanctions imposed on Iran and Russia, the risk assessment constituencies are developed and should include identification of the risks, assessment of the risks, and responding to risks as well as the factors of the risk assessment and the different risk assessment for assessment of the potential contractual relationship 227with the counterparties.^[136] Also, the core elements of risk-based compliance program for dual-use trade controls are set out.^[137] Additionally, specific risk assessment criteria have been developed for the exports of military technology and equipment.^[138] Lastly, non-binding risk management principles for sending humanitarian funds by non-governmental organisations (NGOs) into Syria and similar high-risk jurisdictions have been developed; it is expected that they will implement risk-mitigation standards across all humanitarian programming, and response modalities, in line with international standards, the differentiated approach for their implementation will apply, the risk appetite for the NGOs is an important constituency of the risk management and the key risks and challenges in moving funds are defined.^[139] Also, the typology of the evasion of sanctions imposed on Russia has recently been developed.^[140]

Despite some advancements in the implementation of the RBA in EU sanctions policy, the comprehensive approach to its implementation is absent. It is unevenly applied across different sanctions regimes; the existing regulation does not fully reflect the specifics of the risk-based sanctions compliance in different sectors. The need to tackle the risk of sanctions circumvention is clear, and a typology of the Russian sanctions evasion was recently developed but its scope is relatively narrow compared to the US and UK. The main emphasis is 228on risk-based sanctions compliance; however, greater attention is also needed for implementation of the risk-based supervision.

In the recent legal literature (after the Russia’s full-scale invasion of Ukraine), there has been increased attention to the application of the RBA in sanctions policy. The International Working Group on Russian Sanctions emphasises the need for the application of the RBA in the context of Russian sanctions, particularly in respect of sanctions compliance (e. g. when there is a risk of dealing with Russia) and risk-based supervision, which includes enhanced supervision for higher-risk jurisdictions, companies and individuals believed to be involved in sanctions evasion and identifying for this purpose a list of higher-risk jurisdictions and a list of companies and individuals believed to be involved in sanctions evasion.^[141] Keatinge also recommends the creation of a list of jurisdictions with a high risk of sanctions evasion and additionally specifies that this list could be similar to already existing lists of jurisdictions with a high risk of tax evasion and money laundering, which requires financial institutions to take enhanced measures against such jurisdictions.^[142]

The existing research regarding implementation of the RBA into sanctions policy has some limitations. First, theoretical foundations of the application of the RBA applicably to sanctions policy are absent (e. g., its definition, important constituencies, and peculiarities of the application at the different stages of the sanctions process). Second, in existing studies, the application of the RBA to sanctions policy is relatively narrow in scope, although some recommendations to risk-based sanctions compliance and risk-based supervision have been developed.

Generally, agreeing with the mentioned scholarly proposals concerning the RBA to sanctions policy, it is important to emphasise the need for a comprehensive approach towards the implementation of the RBA in sanctions policy and its broadening and enhancing. The scholarly literature suggests that implementing a RBA has a range of advantages over the regulation, which is not specifically designed to manage risks. Risk-based regulation is, by its nature, a precautionary forward-looking tool, which involves the anticipation and assessment of risks and the use of preventive action to reduce or mitigate the 229risks^[143] that the regulatory/supervisory/compliance framework is designed to address. Also, a RBA to sanctions policy would ensure greater consistency in sanctions decision-making, supervision and compliance because it would be dictated by the relative level of risk. Such approach would allow greater flexibility for competent authorities and par231ties required to comply with sanctions to adapt to changing conditions. It would ensure greater effectiveness in sanctions’ decision-making, supervision, compliance by focusing on areas where the risk is greatest and reducing it where the risks are relatively low and the outcomes that the sanction policy is intended to achieve. It would also ensure better efficiency of the sanctions policy by allowing more efficient use of resources when applying sanctions and controlling their implementation.^[144] The RBA to sanctions policy would allow strengthening incentives for all persons involved in the sanctioned process for prudent and proper behavior. Taking into consideration the advantages of the RBA, it should be a basis for the EU sanctions policy irrespective of the country to which the sanctions regime applies, and its application should be mandatory.

The successful application of the RBA is not possible without a clear understanding of its definition and main constituencies.

The clear definition of the RBA for the EU sanction policy is absent, only its elements are defined in the relation to compliance with the sanctions imposed on Iran and Russia. The RBA for sanctions policy and its main constituencies could be defined on the analogy with such an approach in the related areas, for example, in anti-money laundering and countering the financing of terrorism (AML/CFT).

The RBA for sanctions policy should cover identification, prevention, risk assessment, monitoring, mitigation of the sanctions risks and tailoring the sanctions decision-making / supervision / business activity by competent authorities / parties required to comply with the sanctions policy, commensurate to these risks to prevent them or, if they do materialise, monitor and mitigate them effectively.

One of the central tenets of the RBA to sanctions policy for competent authorities and parties required to comply with sanctions policy, as in case of the AML/CFT, there should be an ongoing assessment of the sanctions risks.

230 Differentiation should be the basis of the sanctions RBA to ensure greater effectiveness of the sanctions. In particular, the risks should be analysed by competent authorities in view of types of imposed sanctions, types of sanctioned persons, types of parties, which are obliged to implement sanctions (their risk profile, industry, in which they operate, etc.), sanctions country-senders and the stage of the sanctions policy cycle etc. Implementing the RBA in sanctions compliance should be sufficiently tailored to the nature, severity and likelihood of occurrence of the specific risks and adverse impacts they identify.^[145]

RBA in sanctions policy does not necessarily seeks to eliminate all risks inherent to the sanction process but it supposes identification, assessment, monitoring and responding to all material risks, including the evolving and newly emerging risks that are inherent to the sanctions process. That is why, the materiality of sanctions risks should be defined.

RBA in sanctions policy supposes that the competent authorities and parties required to comply with the sanctions will take into consideration such risk criteria as the severity and likelihood of the sanctions’ risks occurrence and potential adverse impacts.

Where it is not possible to address all risks, standards for balancing different risks in the sanctions policy cycle should be developed. In particular, criteria for ensuring appropriate prioritisation of risks (which could include severity and probability), including risk factors to ensure a credible process of prioritisation against outcome-oriented targets and ensuring that new and evolving risks feed into prioritisation processes should be established. The sanctions competent authorities and parties required to implement sanctions should focus on higher importance risks while ensuring that lower risks effectively and efficiently addressed.^[146]

Zero-tolerance approach to the violation of sanctions should be an important constituency of sanctions policy. It means that competent authorities and parties required to comply with the sanctions should adopt all reasonable steps to prevent, comply or mitigate material sanctions risks, particularly to prevent the sanctions evasion and other forms of the sanctions non-compliance. If the violation of sanction policy happens, all persons committed it should be subject to liability.

Compared to the existing scholarly proposals, I believe that the RBA to sanctions policy should have a broader scope of application (be mandatorily implemented at all the stages of the sanctions policy cycle, which should include the sanction design, compliance, and supervision, including enforcement).

Risk-based sanctions design: Sanctions decision-makers should implement RBA into the entire process of the imposing, modifying and removing sanctions. The sanctions decision-makers should coordinate their sanctions decision-making with other competent authorities where it is allowed under the law and relevant, including its foreign allies, by sharing information and prioritising risks.^[147] When designing sanctions to manage risks, the regulatory impact assessment process can be used to identify, analyse, and categorise relevant risks and avoid them.

Risk-based sanctions compliance: Third parties, who are not sanctioned persons but who are required to comply with sanctions regulation, should implement a RBA for sanctions compliance purposes across their entire organisational structure, and in their policies and procedures. To enhance the effectiveness of the use of RBA in sanctions compliance, it is rational that competent authorities would issue risk-matrixes or sector-wide guidances to third parties on how they expect them to meet their legal and regulatory sanctions obligations in a risk-sensitive way, taking into consideration specifics of the sectors and types of sanctions. Also, better risk alerts for sanctions compliance needs as in the US should be developed. Additionally, de-risking strategy should be adopted to overcome the de-risking problem. Special Rapporteur on unliteral coercive measures,^[148] as well as US Treasury Department officials,^[149] pay attention to this problem. It has been pointed out that banks and other financial 232institutions are becoming overcautious and often overcomply with sanctions. This can take different forms, from blocking all financial transactions with a sanctioned country, entity or individual, even when some transactions are authorised by humanitarian exemptions or fall outside of the scope of sanctions to requiring cumbersome documentation and charging higher rates etc.^[150] The Special Rapporteur on the negative impact of such practices on respect for human rights and recommends financial institutions to exclude overcompliance to minimise the risks and consequences of violating human rights through their sanctions compliance activities, including any overcompliance and states to adopt measures not to admit such violations.^[151] Given that sanctions compliance requirements are imposed not only on financial institutions but on a great variety of organisations (e. g., legal professionals etc.), de-risking and overcompliance problem should be addressed by a broader number of third parties required to comply with sanctions regulation. To tackle this problem in the area of AML/CFT, a great number of policy instruments are developed.^[152] Similar policy instruments could be developed specifically for sanctions.

Risk-based sanctions supervision and enforcement: The application of the RBA at the stage of supervision of sanctions means that the range, degree, frequency or intensity of controls conducted by competent authorities should be in accordance with the risks posed. Thus, more intrusive enforcement tools and severe enforcement responses could be employed to address situations where the risks associated with sanctions non-compliance are highest.^[153] In this regard, a recommendation of the International Working Group on Russian Sanctions to focus on the supervision of higher-risk jurisdictions, companies and individuals^[154] deserves particular attention. Keatinge also recommends the creation of a list of jurisdictions with a high risk of sanctions evasion, specifying that this list could be similar to the already existing lists of jurisdictions with a high risk of tax evasion and money laundering, and that financial institutions should take enhanced measures against such jurisdictions.^[155] I believe 233that the identification of the high-risk jurisdictions could be accomplished using the methodology for identifying high-risk third countries under AML/CFT Directive already developed by the European Commission.^[156] Additionally, competent authorities should focus on sectors that pose a higher risk for sanctions evasion. The effectiveness of the RBA depends on establishing clear rules on how risk-based supervision will be exercised. For this reason, it is important to develop the risk-based supervision guidelines that could establish the general requirements to the sanctions risk-based supervision and be developed on the analogy with such guidelines, developed by the Financial Action Task Force (FATF)^[157] and also additional guidelines for the specific sectors where sanctions risk-based supervision should apply (e. g., for the banking industry on the analogy with the guidelines, developed by the European Banking Authority for AML/CFT).^[158] These guidelines could take the form of high-level requirements based on the desired outcomes, risk-based rules, and information about how competent authorities should supervise sanctions implementation and enforce sanctions or interpret relevant legislation.

Thus, the RBA should be a central concept of the sanctions policy to ensure its effectiveness; it should be mandatory for application at all stages of the sanctions policy cycle, taking into consideration the risks inherent to all parties involved in the sanctions process and mandatory applicable for both the authorities, responsible for sanction imposition, implementation and supervision, and parties obliged to comply with sanctions. Furthermore, conducting ongoing risk-based analysis, differentiation, materiality, and zero tolerance approach to sanctions violations should be its basis. Also, risk criteria and standards for balancing different risks in the context of sanctions should be developed.