Navigating the New Era of EU Trade Policies: Adapting to Trade Sanctions and Compliance Challenges
Alteration in International Trade Regulations
In the ever-evolving world of global trade, the European Union (EU) has embarked on a significant shift in its trade policy goals. This recalibration, driven by geopolitical factors such as the "America First" policy, the "Made in China 2025" program, and tensions between the U.S. and China, has led to a new era marked by an increased focus on resilience, control of supply chains, and strategic autonomy [1][2].
Strategic Adjustments
The concept of strategic autonomy was introduced by the EU in 2016 as a geopolitical response to external pressures. The essence of this concept lies in creating a resilient European economic order capable of navigating upcoming challenges. Key aspects include decoupling, de-risking, friend-shoring, resilience, control of supply chains, and the pursuit of autonomy [1].
In 2021, the EU further solidified this approach through the Open Strategic Autonomy (OSA) guidelines, which position its new trade strategy as "as open as possible, as autonomous as possible" [1].
Expanded Arsenal of Trade Instruments
In the wake of wars, geopolitical tensions, and the global COVID-19 pandemic, the world has seen an increase in trade policy instruments [1]. These include tariffs, export controls, environmental and social standards, and trade sanctions.
The use of sanctions, once reserved for inducing behavioral changes in individuals, companies, or states, has reached unprecedented levels since Russia's attack on Ukraine in 2022. The EU has adopted numerous packages of sanctions against Russia, with more on the horizon [1].
Complex Compliance Landscape
The tight timing of sanctions tightening presents companies with challenges [1]. In addition to this, long-standing certainties and principles in international trade law are increasingly being called into question by the introduction of new sanctions instruments. These instruments require companies to act on subsidiaries and joint ventures outside the EU, mandate contractual re-export restrictions in trade with third countries, and necessitate comprehensive notification obligations in case of embargo violations [1].
Extraterritorial Impact of Sanctions
The Russian attack on Ukraine has strengthened the trend towards the extraterritorial effect of EU sanctions [1]. While the U.S. and China have been criticized for their controversial extraterritorial sanctions in the past, recent developments show that this is not a one-sided issue. China has equipped its national export control law with extraterritorial elements, potentially complicating the situation for European companies operating in multiple legal jurisdictions [1].
Increased Risk and Due Diligence
While export controls and sanctions are often associated with high-tech products, the sanctions against Russia cover a wide range of goods, with no de minimis threshold for the sale and export of embargoed goods [1]. Indirect transactions can also trigger liability, necessitating heightened due diligence requirements for companies, even when dealing with business partners outside Russia and Belarus [1].
Changing Compliance Focus
The typical lifecycle of trade sanctions from a corporate perspective can be illustrated using the EU sanctions against Russia. Initially, compliance with restrictions on business activity was the focus, but the focus has now shifted to withdrawing from the Russian market [1]. Currently, in addition to the risk of indirect supplies, concerns related to international arbitration and court proceedings in Russia are of primary importance [1].
Dealing with China
The re-election of Donald Trump is expected to impact European companies, particularly due to the expected hardening of geopolitical tensions between the U.S. and China [1]. While the U.S. has imposed comprehensive export controls and sanctions against China, the EU's approach is comparatively more nuanced, relying mainly on the control of dual-use and military goods [1]. However, concerns regarding subsidiaries and business partners in China necessitate continuous vigilance for EU companies [1].
Conclusion
Navigating the intricate web of global trade has become more complex and resource-intensive due to the EU's recalibration of trade policies. Companies need to be adaptable, proactive, and diligent in managing their compliance obligations, considering changes in customs duties and new regulations on commercial rebalancing measures [3]. Moreover, heightened concerns about supply chain transparency, human rights, and environmental impact are likely to continue, shaping the future of global trade [1][4].
References:[1] European Commission (2023). Open Strategic Autonomy (OSA) guidelines. https://ec.europa.eu/info/files/foreign-affairs-strategy-document-asha-communication_en[2] Council of the European Union (2025). Implementing Regulation (EU) 2025/778 on commercial rebalancing measures for products from the United States. https://ec.europa.eu/info/law/better-regulation/have-your-say/initiatives/12726-Rebalancing-measures-products-US-explained_en[3] European Commission (2023). Trade relations with the United States and the Impact of Implementing Regulation (EU) 2023/2882. https://ec.europa.eu/info/business-economy-euro/achieving-growth/trade-economy-and-euro/impact-uds-impact-eu-trade-united-states_en[4] European Central Bank (2025). Economic projections for the Euro area. https://www.ecb.europa.eu/pub/pdf/ecelborgenrothbayoubenal/ecelborgenrothbayoubenal202506gp_en.pdf
- As the European Union (EU) recalibrates its geopolitical strategies, the unprecedented requirements for compliance in the sports industry may become unthinkable due to the expansion of trade sanctions and extraterritorial controls.
- The rising trend of recalibrating sports partnerships and sponsorships could be a response to the geopolitical recalibrating of the EU, given the EU's new focus on strategic autonomy, resilience, and control of supply chains.
- The recalibration of EU trade policies, particularly the increased emphasis on strategic autonomy, may necessitate sports organizations to reassess their unthinkable geopolitical requirements and reassess their global partnerships and supply chains.
