DENMARK Trends and Developments Contributed by: Rikke Sonne, Jakob Skov Bundgaard and Tilde Nielsen Weidinger, Accura
ing employees from continuing to work in a company where a natural or legal person who directly or indi - rectly controls or owns the business becomes subject to sanctions. The practical consequence could be that the company cannot continue its operations. The act thus represents a deliberate legislative intervention to safeguard Danish businesses and employment, even where the company’s owners are designated under EU sanctions. The proposed legislation has been termed the “Firewall Act” because its central mecha - nism requires companies to establish an effective bar - rier (firewall) between the sanctioned person or entity and the company’s governance and economic affairs. The sanctioned person’s managerial and economic rights – including voting rights – are automatically sus - pended, with a proportional increase in the remain - ing shareholders’ voting rights. At the time of writing, the act is scheduled for its first reading on 12 August 2026, with second and third readings currently sched - uled for 25 and 27 August 2026 respectively, and must complete this process before it can finally be adopted. The Firewall Act seems to demonstrate the Danish government’s acknowledgement that the widespread use of sanctions in general and specific designations in particular require measures to safeguard Danish companies and jobs, thus highlighting the extent of sanctions. Focus on Sanctions in Greenland As Greenland is not a member of the EU, the EU sanctions regulations do not apply to Greenland. This means that the implementation of international restric - tive measures in Greenland requires a separate legal framework. This framework has been provided in Act No 242 of 7 March 2023. Pursuant to this act, executive orders have subse - quently been issued, including most recently the Executive Order for Greenland on Restrictive Meas - ures against Russia and Belarus, which entered into force on 31 May 2026 and sets forth sanctions up to and including the 16th sanctions package, with some amendments in order to adjust to Greenlandic circum - stances. For businesses operating in Greenland, this implemen - tation model carries a practical consequence: Green -
land’s sanctions regime currently mirrors only the EU’s first 16 packages, leaving a material gap relative to the 21 packages now in force in the rest of the Kingdom. Companies with a Greenlandic presence should there - fore not assume that measures adopted at EU level, or given effect in Denmark, automatically apply in Green - land, and should monitor the relevant Greenland-spe - cific executive orders separately from their mainland Danish and EU compliance programmes. Given the pace at which the EU has continued to adopt new packages, and the resources required to prepare each Greenland-specific implementing instrument, this gap should be expected to persist, underscoring the importance of jurisdiction-specific due diligence for businesses trading in or with Greenland. Increased Focus on Circumvention As can be seen with the introduction of the 20th and 21st sanctions packages, there has been a growing focus on anti-circumvention measures in the EU’s sanctions. In particular, when trading with countries that have a historically close relationship with Russia, or countries geographically close to Russia, attention must be paid to the risk of circumvention of sanctions. The fundamental legal prohibition on circumvention is found in Article 12 of Council Regulation (EU) No 833/2014 and Article 9 of Council Regulation (EU) No 269/2014, which prohibit EU operators from knowing - ly and intentionally participating in activities the object or effect of which is to circumvent the sanctions. This culminated in April 2026 with the 20th sanctions package, in which the EU’s “anti-circumvention tool” was activated for the first time against Kyrgyzstan. The anti-circumvention tool itself was introduced with the 11th sanctions package, Council Regulation (EU) 2023/1214 of 23 June 2023, which enabled the EU to restrict the sale, supply, transfer or exportation of certain sanctioned goods and technology to third- country jurisdictions with a persistent and particularly high risk of circumvention, though it remained unused in practice until then. Kyrgyzstan occupies a particular place in this devel - opment, as it became the first target of the EU’s formal anti-circumvention tool. As early as February 2026, the EU’s sanctions envoy warned Kyrgyzstan to tighten
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