For the first time, the European Union (EU) has imposed sanctions on a European national for violating the price cap on Russian oil exports. Nils Trost, a Dutch oil trader residing in Switzerland, faces sanctions for his involvement in breaching the $60-per-barrel price ceiling imposed by Western countries. Swiss authorities are also investigating his company, Paramount Energy & Commodities SA.
According to an EU statement, Trost’s Geneva-based company transferred its Russian oil trading operations in June 2022 to its Dubai-based subsidiary, Paramount Energy & Commodities DMCC. The EU alleges that this subsidiary regularly traded Russian crude oil at prices exceeding the established $60-per-barrel limit.
The $60 price ceiling on Russian crude oil, implemented in December 2022, was part of Western efforts to curb Moscow’s oil revenue while maintaining global supply. Under the sanctions, trade involving Western insurers and financiers must adhere to this price limit. However, Paramount’s Dubai subsidiary continued trading East Siberian Pacific Ocean (ESPO) grade oil, which typically trades at prices above the ceiling, unlike Russia’s Urals crude.
Trost has denied violating sanctions, arguing that his UAE subsidiary is legally independent and not bound by EU sanctions. Speaking to The Financial Times, he claimed that his lawyers assured him the operations of subsidiaries in the UAE are exempt from EU restrictions as long as they remain uninvolved with the European parent company. Trost also attributed the sanctions to what he described as the “machinations” of his former business partner, Gaurav Kumar Srivastava.
Swiss law allows foreign subsidiaries of Swiss companies to operate independently of Swiss sanctions. However, if direct links—such as financial transfers or managerial directives—between the parent company and subsidiaries are established, such actions could constitute a sanctions violation. The Swiss Federal Government’s Expert Group on Business Cycles (SECO) began examining the activities of Paramount and other companies in early 2023.
In the spring of 2024, SECO forwarded its findings to Switzerland’s Attorney General’s Office, recommending criminal proceedings based on two separate investigations. While the prosecutor’s office accepted one case, it rejected the other. The names of the involved companies remain undisclosed.
