Fancy footwork

AS THE West is loth to go to war against Russia over Ukraine, its main levers for persuading Vladimir Putin to back down are economic. And the principal economic tools at its disposal are sanctions, which have tightened incrementally since last March. Their importance as a policy was underlined this week, when European Union foreign ministers adopted new measures against 19 individuals and nine entities (implementation was delayed for a week to give diplomacy a chance).

In several cases, however, companies that would have been subject to sanctions because of their links to “designated” Russian oligarchs have managed to wriggle free of the restrictions with well-timed transactions. These have had the effect of reducing the stakes held by parties subject to sanctions below thresholds that would trigger penalties against their businesses. “The blatant manner in which [some Russian entities] have avoided sanctions raises questions about the effectiveness of the existing system and the willingness of the West to enforce its own rules,” concludes an unpublished report by a corporate-investigations firm that has been seen by The Economist. It was compiled for one of the many Western companies that fret about whom they can or cannot do business with under the sanctions regime.