On 9 July 2026, Judge Baumgartner ruled that art gallery Hauser & Wirth had not breached UK trade sanctions by making the artwork “Escape from Humanity” by George Condo available to Mr. Alexander Popov, finding that Mr. Popov did not qualify as a “person connected with Russia” under The Russia (Sanctions) (EU Exit) Regulations 2019 (the “Russia Regulations”).
It is an offence under the Russia Regulations to make available “luxury goods” to “persons connected with Russia”. The category of “luxury goods” is an incredibly broad one, covering, for example, everything from art to pure-bred breeding horses to truffles and caviar to numerous fashion items (if the sales price of these goods exceeds a certain value).
This judgment therefore has important practical implications for any business involved in the supply of “luxury goods” to any person that might be considered a “person connected with Russia” – and offers guidance as to when a person may cease to be a “person connected with Russia”.
A person is considered to be “connected with Russia” for the purposes of the Russia Regulations if:
(i) they are an individual (or an association or combination of individuals) who are ordinarily resident in Russia, or who are located in Russia; or
(ii) they are a person, other than an individual, incorporated or constituted under the law of Russia, or domiciled in Russia.
Judge Baumgartner considered in detail when a person is “ordinarily resident” in Russia, finding that Mr. Popov should no longer be considered as such – despite his Russian citizenship, business interests, ownership of property, family connections, and evidence suggesting his presence in Moscow on particular occasions.
Important factors in determining that Mr. Popov was no longer “ordinarily resident” in Russia included the facts that he had:
(a) transferred property (in this case his art works) out of Russia;
(b) rented out his Moscow residence;
(c) leased residential apartments in Armenia, Bosnia and Herzegovina, and Italy;
(d) made efforts to secure residence rights and citizenship abroad; and
(e) made attempts to renounce his Russian citizenship.
Taken together, and with the appropriate supporting documentary evidence, the Judge considered these factors sufficient to demonstrate a departure from Russia and the establishment of life elsewhere.
The full judgment is available here.
Should you or your contacts require sanctions compliance advice on whether the provision of luxury goods to a particular customer is permissible under the UK’s Russia sanctions regime, please don’t hesitate to contact us – we would be happy to discuss.
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