US expands Russia sanctions, targets chips sent via China

US expands Russia sanctions, targets chips sent via China


US expands Russia sanctions, targets chips sent via China

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WASHINGTON (Reuters) - The United States on Wednesday dramatically broadened sanctions on Russia, including by targeting China-based companies selling semiconductors to Moscow, as part of its effort to undercut the Russian military machine waging war on Ukraine.

Among the steps, the U.S. Treasury said it was raising "the risk of secondary sanctions for foreign financial institutions that deal with Russia's war economy," effectively threatening them with losing access to the U.S. financial system.

It also said it was moving to restrict the Russian military industrial base's ability to exploit certain U.S. software and information technology (IT) services and, with the State Department, targeting more than 300 individuals and entities in Russia and beyond, including in Asia, Europe and Africa.

Separately, the Commerce Department said it was targeting shell companies in Hong Kong for diverting semiconductors to Russia, taking steps that would affect nearly $100 million of high-priority items for Moscow including such chips.

U.S.-origin chips and other technology have been found in a wide range of Russian equipment captured on the battlefield in Ukraine, including drones, radios and missiles.

After seizing Crimea from Ukraine in 2014, Russia launched a full-scale invasion of its neighbor in 2022, triggering a host of new U.S. economic sanctions on Moscow.

Burnt homes and cars riddled with bullet holes lined the streets of the now deserted town of Tila in Mexico.


"Today's actions strike at their remaining avenues for international materials and equipment, including their reliance on critical supplies from third countries," Treasury Secretary Janet Yellen said in a statement.

"We are increasing the risk for financial institutions dealing with Russia’s war economy and eliminating paths for evasion, and diminishing Russia's ability to benefit from access to foreign technology, equipment, software, and IT services," she said. "Every day, Russia continues to mortgage its future to sustain its unjust war of choice against Ukraine."