The 28 EU members renewed a ban on economic ties with Crimean businesses, including a block on EU tourism and investment in the Black Sea peninsula.
The annexation drew international condemnation. It happened after pro-Russian forces seized Ukrainian bases in Crimea and then held a referendum.
Other EU sanctions target top Russian officials over the Ukraine insurgency.
Crimea has a Russian-speaking majority, but the referendum organised by the new authorities there was deemed illegal by the West.
After the Crimea annexation, in April 2014 pro-Russian insurgents seized power in the Donetsk and Luhansk regions of eastern Ukraine. The EU, US and some other countries then ratcheted up their sanctions against Russia.
After the break-up of the Soviet Union in 1991 Russia retained control of the important Black Sea naval base in Sevastopol. But Ukraine had control of the rest of Crimea until the 2014 crisis.
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The EU has extended for another year the sanctions it imposed on Russia over its annexation of Crimea in March 2014.