Gazprombank account not necessarily in violation of sanctions, says German Economy Ministry

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Gazprombank’s logo is seen at a branch in Moscow, Russia March 31, 2022. REUTERS/Maxim Shemetov/File Photo

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BERLIN, April 29 (Reuters) – European energy companies can open special accounts with Gazprombank to pay for Russian gas, a key request from Moscow, without breaching sanctions if the transfer of euros or dollars to them fulfills their obligations contractual, said the German Ministry of Economics.

Russia this week cut gas supplies to Bulgaria and Poland for not paying in roubles, raising fears that other countries could be next.

The Moscow decree stipulates that Gazprombank would open special “K” type accounts for gas payments from foreign buyers. An EU company would transfer foreign currency to one of these accounts, then a Russian bank would convert the payment into rubles and transfer the rubles to another “K” account belonging to Gazprom (GAZP.MM). Read more

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European Union countries remain divided on whether sanctions would be lifted if they committed to Russia’s demand for ruble payments.

The Russian decree stipulated that the buyer’s obligation would not be considered fulfilled until the rubles arrived in Gazprom’s account.

“There are European guidelines on payment methods, which form our framework and which we adhere to,” a spokesperson for the German economy ministry said in an emailed statement on Friday.

“According to these guidelines, account K, on ​​which payment is made in euros/dollars, is subject to sanctions if companies declare that contracts have been executed with payment in euros or dollars.”

A government source said it didn’t matter which country the K account was opened in as long as the bank in question was not on any sanctions list.

The European Commission will provide EU countries with further guidance on whether they can continue to pay for Russian gas without breaching the bloc’s sanctions, a Commission official told Reuters on Friday.

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Reporting by Markus Wacket; written by Riham Alkousaa and Christoph Steitz; edited by Paul Carrel and Jason Neely

Our standards: The Thomson Reuters Trust Principles.

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