Amany Chamieh and Khalil Chlaifa discuss the EU’s 20th sanctions package in Law360

The European Union (EU) has handed its courts a powerful new weapon against Russian efforts to derail international arbitration. On 23 April 2026, the EU’s 20th sanctions package became law, introducing for the first time an EU-wide anti-suit injunction mechanism

EU Member State courts can now order Russian parties to halt retaliatory proceedings brought in breach of arbitration agreements and impose substantial financial penalties for non-compliance. For European businesses entangled in disputes with Russian counterparties, this development demands immediate attention.

The 20th sanctions package is implemented principally through two amending regulations: Regulation 2026/506, which amends[2] Regulation 833/2014,[3] and Regulation 2026/511,[4] which amends Regulation 269/2014.[5]

Among the sweeping range of new economic and financial sanctions – targeting  Russia’s energy revenues, military-industrial complex, financial services and trade – the  package introduces a targeted legal mechanism of particular significance for international arbitration.

For the first time, EU Member State courts are empowered to order Russian parties to refrain from initiating, or to discontinue, retaliatory proceedings brought in Russia in breach of arbitration agreements. Failure to comply with these orders can result in financial penalties. This effectively enables EU courts to “mirror” Russian retaliatory litigation mechanisms.

To understand the significance of this new mechanism, it helps to trace how Russia’s retaliatory litigation framework has evolved. The EU’s response centers on Article 11ca of Regulation 833/2014, which introduces the new anti-suit injunction regime. That regime is complemented by an expanded forum necessitatis jurisdiction, providing a procedural safety net for affected parties. This article will discuss this new regime and its implications for EU businesses engaged in international arbitration with Russian counterparties.

I. Retaliatory Litigation Framework

Since 2020, Russia has enacted legislation designed to pull disputes involving sanctioned Russian parties out of international arbitration and into Russian courts. Commonly referred to as the “Lugovoy Law”, amendments to the Russian Arbitrazh (Commercial) Procedure Code – in particular Articles 248.1 and 248.2 – empower Russian courts to assert exclusive jurisdiction over any commercial dispute involving a Russian natural or legal person subject to foreign sanctions, or any dispute whose subject matter relates to economic sanctions.[6]

Under this framework, such disputes may be redirected to Russian courts or arbitral tribunals seated in Russia, irrespective of the parties’ original agreement. Crucially, Russian courts may also issue anti-suit injunctions restraining foreign court or arbitral proceedings and impose penalties of up to the full value of the foreign claim, plus legal costs, on parties who defy such injunctions.

In practice, this has meant that EU businesses with valid arbitration agreements have faced parallel, retaliatory litigation in Russian courts, undermining their contractual rights and creating significant commercial risk.

Recent years have seen such retaliatory litigation multiply, with increasingly severe consequences for European parties. In the Wintershall Dea GmbH v. Russian Federation case, a Russian court imposed a EUR 7.5 billion penalty in November 2025 against the claimant, its counsel and the arbitral tribunal for non-compliance with an anti-arbitration injunction in an Energy Charter Treaty case against Russia.[7]

Similarly, in the OMV v. Gazprom dispute, anti-enforcement measures were granted in February 2026 prohibiting OMV from enforcing any arbitral or court decision against Gazprom outside Russia[8].

The EU has progressively responded to this trend through successive sanctions packages. The 14^th sanctions package introduced protections enabling EU entities to seek remedies in EU courts where they faced Russian claims and prohibited the recognition or enforcement within the EU of Russian court decisions and penalties issued under Articles 248.1 and 248.2 of the Arbitrazh Procedure Code. The 15^th sanctions package reinforced this shield by extending the non-recognition regime. The 18^th sanctions package further expanded the framework to cover investor-State dispute settlement, allowing EU Member States to seek damages and costs arising from investment arbitration claims brought by sanctioned individuals. The 20^th sanctions package now goes further by introducing, for the first time, a European anti-suit injunction mechanism.

II. The New Anti-Suit Injunction Mechanism

The new Article 11ca of Regulation 833/2014, introduced by Regulation 2026/506, creates a targeted remedy to the Lugovoy Law. This article applies where a Russian entity has started, or threatens to start, proceedings in Russian courts in connection with a contract affected by EU sanctions, in breach of an arbitration or exclusive jurisdiction clause.

The following parties may apply to an EU Member State court for an anti-suit injunction:

• any person who is a national of an EU Member State; or
• any legal person, entity or body, inside or outside the territory of the EU, is incorporated or constituted under the law of a Member State.

The court may order the Russian party to:

• Refrain from initiating proceedings in Russia; or
• Discontinue proceedings already underway.

If the Russian party does not comply with such an order, the EU Member State court may impose financial penalties. These penalties must be proportionate to the potential loss the EU party could incur as a result of non-compliance and are payable directly to the affected EU party. This penalty mechanism effectively mirrors the system of financial penalties that Russian courts have been deploying against European companies.

In short, this new mechanism gives EU businesses a court-backed tool to enforce their arbitration agreements and resist Russian forum-shopping tactics.

The new regime is particularly significant for civil law jurisdictions within the EU – notably France. Unlike common law systems, where anti-suit injunctions are a well-established tool, civil law systems have traditionally been reluctant to entertain applications for orders restraining proceedings before foreign courts. The 20^th package provides, for the first time, an EU-wide legal basis for such relief.

III. A Safety Net: Forum Necessitatis Jurisdiction 

Regulation 833/2014 already contained a “last resort” jurisdiction rule (forum necessitatis) in Article 11d. Under this rule, EU Member State courts may hear certain claims for damages on an exceptional basis – even where no EU court would normally have jurisdiction – provided the case has a sufficient connection with the forum Member State.

The 20^th sanctions package extends this jurisdictional safety net to Article 11ca. EU parties may now seek penalties against a Russian party for non-compliance with an EU anti-suit injunction, even where no EU court would otherwise have jurisdiction. The sole requirement is a sufficient connection with the Member State of the court seized.

IV. Practical Considerations for EU Businesses

This new mechanism significantly expands the toolkit available to EU parties involved in international arbitration with Russian counterparties. Its purpose is to support arbitration and preserve the integrity of arbitration agreements by reducing the pressure created by parallel Russian proceedings. EU companies that have already been subjected to retaliatory proceedings under the Lugovoy Law – or that face the credible threat thereof – now have an additional avenue to seek injunctive relief and financial penalties against the sanctioned party.

Considerable practical uncertainties remain, however. While the EU Regulation provides the substantive legal basis for anti-suit relief, the procedural modalities for applying to EU Member State courts have yet to be clarified. Questions remain about which courts will hear such applications, what evidence will be required, and how penalties will be calculated and enforced across borders. EU Member States are expected to issue further guidance on implementation.

V. Looking Ahead

The introduction of the anti-suit injunction mechanism marks a turning point in the EU’s approach to Russian retaliatory litigation. For the first time, EU parties have access to an affirmative, court-based tool to restrain proceedings brought in breach of arbitration agreements – mirroring the very tactics Russia has deployed against them.

The mechanism’s ultimate effectiveness will depend on how Member States implement it and how Russian parties respond. But the message from Brussels is clear: the EU will no longer allow arbitration agreements to be undermined.

International arbitration practitioners should treat this new mechanism as an essential part of their procedural strategy when dealing with Russian counterparties subject to EU restrictive measures. Those currently facing or anticipating Russian retaliatory proceedings should assess their options under Article 11ca without delay.

[1] https://www.consilium.europa.eu/en/press/press-releases/2026/04/23/russia-s-war-of-aggression-against-ukraine-20th-round-of-stern-eu-sanctions-hits-energy-military-industrial-complex-trade-and-financial-services-including-crypto/

[2] https://eur-lex.europa.eu/eli/reg/2026/506/oj/eng.

[3] https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A02014R0833-20260424

[4] https://eur-lex.europa.eu/eli/reg/2026/511/oj/eng

[5] https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A02014R0269-20260423

[6] https://cisarbitration.com/2024/09/10/exclusive-jurisdiction-of-russian-courts-the-impact-of-sanctions-and-the-lugovoy-law/

[7] https://globalarbitrationreview.com/article/russia-seeks-enforce-wintershall-injunction

[8] https://globalarbitrationreview.com/article/omv-wins-another-award-against-gazprom