European companies will be able to pay for the Russian gas while meeting Moscow's demands to do so in rubles without violating EU sanctions at the same time.
The scheme proposed by the European Commission suggests that companies will wire their payments in euros or dollars to a bank account in Russia, where the currency will be converted into rubles. Brussels' memo said that the European firms' obligations will be complete once the payment in currency is deposited in the Russian bank. They will therefore not be in breach of the EU's own sanctions on Russia over its special military operation in Ukraine.
"EU companies can ask their Russian counterparts to fulfil their contractual obligations in the same manner as before the adoption of the decree, i.e. by depositing the due amount in euros or dollars", the document said referring to Moscow's decree to pay for gas in rubles.
On the same day, UK Treasury also issued a document that temporarily allowed British companies to wire funds to the Russian Gazprombank to pay for Russian gas — despite London slapping sanctions on the arm of the national gas company. The sanctions waiver lasts until 31 May and will allow the UK companies to meet the new requirements for gas payments issued by Russia in April.
UK authorities explained the time limit on the waiver as part of the EU's aim of gradually phase out Russian energy imports in the light of the special operation.
Moscow issued the new decree early in April in response to the western sanctions, requiring countries that imposed them — dubbed "unfriendly" by Russia — to "pay for Russian gas in rubles". Technically, the decree required importers to deposit their gas payments in euros and dollars in accounts at Gazprombank, which had already been sanctioned by some of those states. Later, these deposits would be converted into rubles to complete the payments.
The Kremlin decree came as a response not only to anti-Russia sanctions, but also to the decision by western governments to unlawfully freeze the Russian Central Bank's assets in foreign currencies deposited in their countries. Moscow recently vowed to sue those governments over the move and fight to release the funds.