Japan Sanctions Garantex, Russia's 'Shadow Fleet' Amid Ukraine War

The Japanese government has expanded its sanctions against Russia, citing the ongoing war in Ukraine. The new measures include an asset freeze list that restricts payments and capital transactions with targeted parties, including the Russian cryptocurrency exchange Garantex. The exchange was previously sanctioned by the US, the EU, and other jurisdictions for helping Russian entities evade financial restrictions. The Japanese government has added 33 organizations and nine individuals linked to Russia to its asset-freeze list, as well as 35 vessels identified as part of the 'shadow fleet' that carries Russian oil and helps Moscow evade existing sanctions. These measures specifically restrict services including repairs and insurance to cover the designated vessels.

Through the sanctions, Japan aims to help reduce Russia's earnings from crude oil exports. However, a report by blockchain intelligence firm TRM Labs in August 2022 suggested that Garantex may have already had a contingency plan in place to skirt the impact of US actions. The report stated that entities like Garantex 'appear to prepare contingency plans well in advance of anticipated enforcement measures,' allowing them to quickly migrate clients, infrastructure, and funds to successor platforms.