In a reciprocal step, an executive order banning European Union haulage trucks crossing borders into Russia’s territory aggravates economic situation for both Russia and the European Union. Besides the European Union, the ban also affects international cargo transport on Russian territory for transport companies from Ukraine, the United Kingdom of Great Britain and Northern Ireland and Norway.
The ban applies to two way transportation, transit, and transportation from or to a third country, and valid from October 10 until December 31, 2022. On the other side, from April 8, any Russian and Belarusian automobile transport enterprise has been banned from cargo transportation, including transit carriage, in the European Union.
Under the current conditions, EU trucks facing ban from Russia loose huge revenues while essential consumers and other foreign products are obviously cut from the distribution chains, and the situation is characterized by serious price hikes.
Late September, Russia’s President Vladimir Putin signed an an Executive Order On Some Aspects of International Road Transport of Goods as a reciprocal measure to the new round of latest EU sanctions due to the Russia’s special military operations in the former Soviet republic of Ukraine.
It was signed in light of some foreign states’ unfriendly actions aimed at adopting restrictions against citizens of the Russian Federation and Russian legal entities, which contradicts international law, to protect the national interests of the Russian Federation and in accordance with Federal Law No. 127-FZ, dated June 4, 2018, On Measures (Countermeasures) in Response to Unfriendly Actions of the United States and Other Foreign States.
Under the Executive Order, the Government of the Russian Federation is authorised to adopt a ban on international road transport of goods across the territory of the Russian Federation for vehicles of international carriers registered in the states that have adopted restrictions against citizens of the Russian Federation and Russian legal entities in the area of international road transport of goods.
If the Government adopts such a ban, it should also stipulate its duration; include the list of states that have introduced restrictions against citizens of the Russian Federation and Russian legal entities in the area of international road transport of goods; the types of international road transport of goods covered by the ban; and the conditions of international road transport of goods compliance with which precludes the imposition of the ban.
The Russian permits, special permits and multilateral permits stipulated in Federal Law No. 127-FZ, dated July 24, 1998, On State Control over International Transport by Road and on Liability for Violating Procedures for Such Operations, shall be considered null and void if foreign carriers use them for international road transport of goods in violation of this ban.
Leading experts commented on the European Union trucks ban from entering Russia. “We’ve been waiting precisely for this decree for months now. We proposed not to completely ban the import of merchandise but to introduce restrictions on trucks entering Russia so that cargos are handed over at the border. European carriers will enter the border zone and hand over the cargos to our carriers,” President of the Gruzavtotrans Association Vladimir Matyagin told local Russia media Rossiyskaya Gazeta. According to him, this will help those Russian truckers who lost their jobs due to the sanctions to transport merchandise domestically.
Executive Director of BMJ Logistics Alexey Yakushev told the Kommersant newspaper that back in April when the EU banned Russian and Belarusian transport carriers from crossing their borders, European logistics operators began preparing for retaliatory measures, actively wrapping up their activity in Russia.
“So this ban will most likely affect small and medium-sized companies in the EU’s transport sector who continue to deliver cargos to Russia,” he said, noting that domestic carriers would only win while those companies involved in imports from Europe would most likely shoulder additional expenses.
Market experts acknowledge there is currently economic crisis which is aggravated by the risks of transit causing some enterprises to either scale down or shut down operations, and further say retaliatory ban on trucking in Russia from those countries, including European Union, costs of cargo transportation from Russia to Europe and back has already skyrocketed four or even fivefold. According media reports, importers and exporters have already sustained extra costs of over $1.26 billion at the current exchange rate), while the annual figure about $6.18 billion.
As a direct result of Russia’s “special military operation” aims at “demilitarization and denazification” in the former Soviet republic of Ukraine since late February, Russia has come under a raft of sanctions imposed by the United States and Canada, European Union, Japan, Australia, New Zealand and a host of other countries. President Vladimir Putin has signed a decree on legal recognition of Donetsk, Lugansk, Zaporozhye and Kherson regions’ independence and finally joined the Russian Federation.