The 27 members of the EU unanimously agreed the measures at an informal meeting in Paris on the sidelines of an international forum, EU foreign policy chief Josep Borrell said.

The sanctions will also target Russian parliament members who backed recognising the breakaway regions as independent, a decision announced by President Vladimir Putin on Monday.

"The sanctions will hurt Russia and will hurt a lot," Borrell said at a press conference with French Foreign Minister Jean-Yves Le Drian.

Targets for asset freezes and visa bans included 351 members of the Duma, Russia's lower house of parliament, who appealed to Putin to recognise the two regions as independent, he added.

Le Drian, whose country holds the rotating EU presidency, said the member nations had "unanimously agreed on an initial sanctions package".

He accused Russia of "violating international law" and "breaching its commitments".

Borrell said the EU also agreed to target 27 individuals and entities "who are playing a role in undermining or threatening Ukrainian territorial integrity, sovereignty and independence".

Banks financing Russian decision makers and other operations in those territories are also being targeted, he said.

There will be another meeting of EU ambassadors in Brussels later Tuesday, when the sanctions are expected to be formally adopted.

Le Drian said he would also cancel the Paris invitation to his Russian counterpart Sergei Lavrov for talks in the wake of Putin's announcement on the recognition of the breakaway regions.

Announcing his decision, Le Drian said that recent developments had shown that Putin "no longer honours Russia's signature" on international accords.

Borrell added however that "diplomatic action will continue to avert a war in the heart of Europe."