PJSC National Bank “TRUST” (“NBT” or “the Bank”) is a name that will already be familiar to many insolvency practitioners, given how frequently it surfaces as a creditor or claimant in cross-border recovery proceedings. That is no accident of litigation strategy. The Bank was created in 2018 out of the Central Bank of Russia’s rehabilitation of several failed lenders. Rather than winding those institutions down, the Central Bank of Russia consolidated their bad and non-core loans into NBT, which chases recovery on distressed debt. The EU’s own designation grounds, describe NBT as a “state-owned non-core assets bank” majority-owned by the Central Bank of Russia. NBT’s recovery actions have repeatedly brought it into contact with insolvency proceedings, trustees and cross-border enforcement which now makes the EU’s new designation a matter of direct practical relevance to practitioners already handling NBT-related matters.
On 23 July 2026, the Council of the European Union added NBT to the EU’s Russia asset-freeze list, and shortly thereafter subjected it to a standalone transaction ban, one part of a far broader move against Russia’s banking sector.
The designation, made under Council Implementing Regulation (EU) 2026/1843 (amending Council Regulation (EU) No 269/2014), freezes NBT’s funds and economic resources with immediate effect and prohibits EU persons from making funds or resources available to it, directly or indirectly. A second measure, Council Regulation (EU) 2026/1848 (amending Council Regulation (EU) No 833/2014), goes further still: from 13 August 2026, EU operators will be prohibited from engaging in transactions with the Bank altogether.
NBT does not stand alone in this respect. The same package, the EU’s 21st sanctions package against Russia, imposed asset freezes on 94 banks and major financial institutions, while extending the separate transaction ban to a further 33 Russian credit and financial institutions. The scale of this action reflects a deliberate escalation of pressure on Russia’s financial infrastructure, and means that professionals advising on NBT-related matters are very likely to encounter parallel issues across a wider population of newly designated Russian banking counterparties.
The listing is notable not only for its substantive impact on EU counterparties, correspondent banks, and creditors of NBT, but also for the contrast it draws with other jurisdictions.
In the United Kingdom, NBT has featured prominently in sanctions-adjacent litigation, including in the matter of Mints v PJSC National Bank Trust [2023] EWCA Civ 1132 and the more recent Thomas v PJSC National Bank Trust proceedings, yet UK authorities have consistently maintained that NBT is not a UK-designated person. The EU’s decision to designate the Bank therefore creates a jurisdictional divergence with immediate practical consequences: EU-based law firms, litigation funders, insurers, and financial institutions dealing with NBT, whether as claimant, defendant, judgment creditor, or contractual counterparty, must now navigate a materially different compliance landscape than their UK counterparts.
Professionals who act without first considering whether the necessary sanctions authorisations have been obtained may expose themselves, their firms and, potentially, their clients to significant legal and regulatory risk.
This article examines the scope and legal basis of the new designation, considers its implications for ongoing and future litigation involving NBT within the EU, and highlights the key compliance steps for professionals to consider in response.
Implications for Litigation Proceedings
The addition of NBT and the 94 other banks and financial institutions newly subject to EU asset freezes, plus the 33 further institutions caught by the transaction ban, does not, in itself, prevent litigation from being brought or continued. Access to justice is not typically disturbed by an asset freeze. What changes materially is everything that surrounds the litigation: considerations around how proceedings can be funded, how costs and damages can be paid, how judgments can be enforced, and how existing contractual and dispute-resolution arrangements with a now-designated counterparty can lawfully continue.
i. Claims brought by NBT (or a similarly listed institution)
A designated entity generally retains the right to initiate or continue proceedings in an EU member state court. However, any payment flowing to it, a damages award, a settlement sum, a costs order in its favour, falls within the asset-freeze prohibition on making funds available. In practice, legal advice will need to be sought as to how to deal with such sums to ensure compliance with the sanctions regime; will it need be paid into a frozen account held in the designated entity’s name, or channelled under a specific authorisation from the relevant national competent authority? Defendants, their insurers and their adviser will need to build this into any settlement structure from the outset.
ii. Claims brought against NBT (or a similarly listed institution)
Enforcement is where the practical friction is greatest. A claimant who obtains judgment against a designated bank cannot simply attach or realise against its EU-held assets, those assets are frozen, and enforcement steps will usually require prior authorisation. Judgment creditors should expect delay, and should factor licensing timelines into any enforcement.
iii. Legal costs and third-party payment chains
This is the issue that has generated the most contested case law in the UK equivalent context (see Thomas v PJSC National Bank Trust), and it will likely recur under the EU regime.
Firms acting for or against a newly designated bank should review the specific derogation wording in Regulations 2026/1843 and 2026/1848 and confirm the authorisation route in each relevant member state before costs change hands.
iv. The transaction ban’s broader reach
From 13 August 2026, the standalone transaction ban under Regulation 833/2014 applies in addition to the asset freeze. This prohibition is broader in scope, it is not limited to the movement of funds, but restricts EU operators from engaging in transactions with the listed institution at all. This could capture settlement agreements, litigation funding arrangements and even the ordinary conduct of a dispute (engagement letters, procedural agreements, cost-sharing arrangements) with the designated bank as counterparty, not merely payments made to it. Practitioners should assess, on a case-by-case basis, whether a proposed litigation step constitutes a “transaction” for these purposes, and whether any derogation applies.
Practitioner Checklist: Navigating Sanctions in Cross-Border Litigation
The following are a number of considerations for practitioners to take into account when faced with cases involving sanctions, it is not an exhaustive list and will vary depending on the facts and parties involved.
- Check designation status – the counterparty’s status may differ across the EU, UK, US and other relevant regimes, and can change mid-proceedings.
- Map the jurisdictional touchpoints – forum, party domicile, asset location, governing law, and payment routes each carry their own sanctions exposure.
- Plan payment mechanics early – settlements, damages and costs to or from a designated party will generally need be to a frozen account or licensed channel.
- Treat legal fees as a distinct issue – derogations often require authorisation.
- Consider transaction bans, not just asset freezes – these can capture the litigation process itself, not only payments.
- Build licensing timelines into enforcement strategy – a judgment is rarely self-executing against frozen assets.
- Coordinate multi-jurisdictional advice, rather than relying on a single-jurisdiction analysis.
- Keep a contemporaneous record of designation checks and advice obtained.
Conclusion
Sanctions compliance is no longer a peripheral concern for litigators, it now sits at the heart of how cross-border disputes involving Russian (and other sanctioned) counterparties are run.
A counterparty’s designation status can shift mid-proceedings, funding and payment structures that once seemed routine now require active sanctions analysis, and enforcement can no longer be assumed to be straightforward. Missteps carry real consequences, regulatory exposure for the professionals involved, unenforceable settlements, and reputational risk for firms and their clients alike.
The practical result is a shift in how litigation involving such counterparties must be resourced and planned: sanctions screening at the outset, sanctions-aware drafting of settlement and funding arrangements, and ongoing monitoring throughout the life of a case, rather than a single check performed at the point proceedings are issued. Firms that build this into their standard case-management approach will be far better placed to protect their clients’ positions and their own.
*This article is intended for general informational purposes and does not constitute legal advice.
Andri is on the list of approved Insolvency Practitioners of the DIFC and ADGM. She is a solicitor, Member of the Law Society of England and Wales and a Licensed Insolvency Practitioner in Cyprus.
Chris is a Chartered Accountant, member of the Institute of Chartered Accountants in England and Wales (ICAEW) and the Emirates Association for Accountants and Auditors (EAAA), his details are on the list of approved Insolvency Practitioners in DIFC and ADGM. He is also a UK, Cyprus and Romania licensed Insolvency Practitioner.
