On Monday, January 26, the 27 EU member states formally adopted the regulation on phasing out Russian imports of both pipeline gas and LNG into the EU.
The new rules also include measures on effective monitoring and diversification of energy supply.
"As of today, the EU energy market will be stronger, more resilient and more diversified," said Michael Damianos, Minister for Energy, Commerce and Industry of Cyprus. "We are breaking away from detrimental reliance on Russian gas and taking a major step, in a spirit of solidarity and cooperation, towards an autonomous energy union."
According to the regulation, importing Russian pipeline gas and LNG into the EU will be prohibited. The ban will start to apply six weeks after the regulation enters into force while existing contracts will have a transition period.
The European Council (EC) said this stepwise approach will limit the impact on prices and markets. A full ban will take effect for LNG imports from the beginning of 2027 and for pipeline gas imports from the autumn of 2027.
Before authorising entry of gas imports into the union, EU countries will verify the country where gas was produced.
Non-compliance with the new rules may result in maximum penalties of at least €2.5 million (US$3 million) for individuals and at least €40 million (US$48 million) for companies, at least 3.5 per cent the company’s total worldwide annual turnover, or 300 per cent of the estimated transaction turnover.
By March 1, 2026, EU countries must prepare national plans to diversify gas supplies and identify potential challenges in replacing Russian gas. To that end, companies will be required to notify authorities and the European Commission of any remaining Russian gas contracts.
EU countries still importing Russian oil will also have to submit diversification plans. In the event of a declared emergency, and if security of supply is seriously threatened in one or more EU countries, the commission may suspend the import ban for up to four weeks.