Sanctions against Russia: evasion, compensation and overcompliance

In the popular imagination, sanctions are akin to arrows at an archery range: fired by archer A, they fly in a regular arc to hit ‘target’ B with varying degrees of accuracy. Attractive as this model may be, however, it does scant justice to the reality of how sanctions work. For targets are less like static archery butts than live game, ducking and weaving to avoid projectiles. In Russia, these feints have taken a variety of forms, including exploiting loopholes, altering share structures and using tax havens with the aim of concealing beneficial ownership. If sanctions do not change direction in the course of their flight, they will miss their target or simply deliver glancing blows.