Restricted Party List updates October 2024

October 22, 2024

Dutch criminal conviction for Russia sanctions violations

The Rotterdam District Court has found a defendant guilty of sanctions evasion in Case 83-151106-23 for using his company to deliver aircraft parts to Russian companies Ural Airlines, S7 Engineering and Siberia Airlines and deliberately trying to circumvent sanctions by claiming the goods were for companies in Tajikistan, Serbia and Turkey.

Dutch prosecutors seek sentence and confiscation for Russia sanctions violations

The Dutch prosecution service is seeking a 24-month prison sentence for a defendant accused of sanctions violations and a court order to forfeit his company stock and confiscate any profits arising from the violations. The defendant is said to have traded dual use computer components to 2 Russian companies in breach of EU Russia sanctions and to have forged documents to conceal that he was trading with Russia. He was arrested in July 2023 and received permission to continue trading pending the outcome of his trial in May 2024.

EU Court rejects challenges to Russia sanctions prohibition

The General Court of the European Union has rejected challenges to the EU prohibition on providing legal advisory services to the Russian Government and Russian entities brought by:

  • T-797/22, the Brussels Bar Association and several Belgian lawyers
  • T-798/22, the Paris Bar Association and one of its members
  • T-828/22, the Association Avocats Ensemble (ACE).

All sought to annul Article 1(12) of Council Regulation 2022/1904 in so far as it amended Article 5n of Regulation 833/2014 to ban the provision of legal advisory services.

Norwegian customs confiscate 23 items prohibited by Russia sanctions

Norway, along with the EU, US and UK have steadily expanded the lists of products not allowed to export to Russia. On October 2nd, Norway adopted EU’s 14th sanctions package as a part of the response to the full-scale invasion of Ukraine. Thousands of restricted items in hundreds of categories are targeted, particularly dual-use goods and critical technologies that could support Russia's military efforts. Many of the products are low-cost, like mineral oil and tools you can by at Biltema or other retail stores. Microchips, sensors, and even a new iPhone are examples of banned products anyone can buy in a local Norwegian Elkjøp store, put into their pocket and embark the vessel at port before sailing back to Russia. Half a year into Russia’s full-scale war on Ukraine in 2022, the Barents Observer could report about zero confiscations of so-called luxury goods from people crossing the Norwegian-Russian land border at Storskog. Customs authorities in Norway in 2023 – 2024 confiscated 23 items on Norway’s border with Russia that it says were prohibited by EU Russia sanctions.

Estonia investigating sanctions and violations at Russian border

Estonian Tax and Customs Board (ETCB) says it has detected nearly 600 customs and sanctions violations at their border with Russia in 1 month. Reports suggest ECTB have prevented over €3 million of cash from being exported to Russia in the last year and to have seized military boots, drones, weapons parts, jewellery and wine.

EU renews ISIL/Daesh & Al-Qaeda and Sudan sanctions regimes

The EU has renewed its sanctions regime against ISIL/Daesh and Al-Qaeda and against Sudan.

  • ISIL/Daesh and Al-Qaeda:

The EU’s regime against ISIL/Daesh and Al-Qaeda will now last until 31 October 2025. It was last renewed in October 2023. Currently there are 15 persons and 6 groups designated under the regime.

  • Sudan:

The regime against Sudan is now set to apply until 10 October 2025. 6 individuals and 6 entities are currently designated under this regime.

EU renews Nicaragua sanctions

The EU has extended its restrictive measures in view of the situation in Nicaragua for another year. The measures were first introduced in October 2019. Currently 21 individuals and 3 entities have been designated under the EU’s Nicaragua regime. The restrictive measures are now extended until 15 October 2025.

German customs investigation over streaming of Russian TV channels

German customs are conducting an ongoing investigation into a couple suspected of violating Russia sanctions. The unnamed husband and wife allegedly offered customers access to several sanctioned Russia TV channels via an IP-TV service. German customs suspects this included channels such as Rossiya 1 and Russia Today.

Hague Court of Appeal upholds conviction for breach of Dutch ISIS sanctions

The Court of Appeal in the Hague has given judgment upholding the criminal conviction of a defendant convicted for transferring €500 to 2 women who were considered part of ISIS, breaching the Dutch Sanctions Act 1977. The women who received the money satisfied the criteria at the time of the transfers and the defendant was sentenced to 48 months in prison.

New EU ‘hybrid threats’ sanctions framework targeting Russia

The Council of the EU has announced a new framework of sanctions against Russia. The new framework addresses hybrid threats. It targets those who are responsible for, implement, support or benefit from Russia’s destabilising actions worldwide. The framework is said to be in response to activities undertaken by Russian parties against the EU and its Member States (hybrid threats). These include cyberattacks, election interference, arson, vandalism and disruptions to satellite communications. The framework comes into effect 8 October 2024. Link

Lithuanian customs fines companies for sanctions breaches

Lithuanian customs has issued fines of €10,000 against 2 companies for breaching sanctions by providing services to Russian companies that were sanctioned by the EU. The services were storage and customs services for carbon and rubber shipped from Russia.

Luxembourg fines over sanctions compliance

On 19 July 2024, the CSSF imposed an administrative fine amounting to EUR 40,000 on the electronic money institution “Dock Financial S.A.” (the “EMI”), authorised as electronic money institution in accordance with the provisions of the Law of 10 November 2009 on payment services. The fine is for non-compliance with obligations related to anti-money laundering and counter financing of terrorism. During an onsite inspection in 2021-2022, the CSSF are said to have identified several breaches of Dock Financial’s compliance obligations. 

Netherlands - Transactions after suspicion of violations of the Sanctions Act

Two suspects have agreed on a settlement with the Public Prosecution Service in the context of an out-of-court settlement because of a suspicion of violating the Sanctions Act. It concerns a company that has its registered office in Amsterdam and its director. According to the Public Prosecution Service, millions in dividends were wrongly paid to a Russian company that was behind someone that was subject to sanctions. Furthermore, according to the Public Prosecution Service, a loan has been repaid to another Russian company that is on an EU sanctions list.

SECO: Ordinance imposing measures against Guinea-Bissau

On 7 October 2024 the Federal Department of Economic Affairs EAER has amended annexes 1 and 2 to the ordinance imposing measures against Guinea-Bissau. One individual has been removed from the sanctions list. In addition, the financial sanctions against two other individuals have been lifted. The measures come into force at 6 pm on 8 October 2024. Link

SECO - Sanctions: Ordinance on Measures concerning Haiti

The UN sanctions committee has amended the list of sanctioned individuals, companies and organizations. The SESAM database has been updated accordingly. 
On 4 March 2016 the Federal Council has adopted the Ordinance on the automatic application of the UN Security Council’s sanctions lists. Hence, the amendments of the UN Security Council’s sanctions lists enter into force in Switzerland without delay.

UK sanctions Russian troops for deploying chemical weapons & amends cyber entries

The UK has designated 1 individual and 3 entities for deployments of chemical weapons under the UK’s Chemical Weapons regime. They include the Radiological, Chemical and Biological Defence Troops of the Russian Armed Forces and its leader Igor Kirillov. According to the press release, both are responsible for helping deploy chemical weapons on the battlefield. One of the chemicals said to have been used is chloropicrin, a choking agent first used during WWI. Also designated are the 33 Scientific Research and Testing Institute and the Russian Ministry of Defence 27th Scientific Centre for involvement in developing and deploying the weapons on frontlines. Cyber Amendments: The UK has also corrected 4 entries on its cyber list.

UK adds Russia FAQs and updates payment to water companies GL

The UK has added 2 FAQs to its financial sanctions FAQs:

  • FAQ 121 clarifies that internal settlements of Russian securities between 2 sub-accounts held within the same non-designated institution or depository do not engage UK sanctions. They can therefore be undertaken without an OFSI licence.
  • FAQ 122 relates to the provision of trust services under the Russia Regulations. It clarifies that the prohibitions apply regardless of the location of the trust if the services are provided to a designated person, or benefits persons connected with Russia. The FAQ also explains that cases are treated individually and persons must satisfy themselves that they have done adequate due diligence to comply with the prohibitions.

OFSI has also amended General Licence INT/2023/3179120. The GL permits designated persons to pay water companies from frozen UK bank accounts.

UK FCA fines Starling Bank for financial systems failings

The UK Financial Conduct Authority has fined Starling Bank £28,959,426 for failings related to sanctions systems and controls.  The FCA’s role is to ensure that the firms it supervises have adequate systems and controls to comply with UK sanctions. Some key points from the FCA’s decision:

  • Starling grew hugely from 2016 (revenue £13k) to 2023 (£452.8 million) and the FCA says its financial crimes controls did not keep pace with its growth.
  • Starling breached FCA principle 3 by failing to design, implement and maintain adequate sanctions controls. E.g. Starling’s screening system had only been screening against a fraction of the names on the consolidated sanctions list (those with links to the UK), Starling had not screened customers against non UK lists despite US dollar payments, customers were only screened every 14 days and new customers only after onboarding, and its risk assessment did not sufficiently set out the firm’s financial sanctions risk for senior management).
  • The FCA had identified serious concerns in 2021 as a result of which Starling agreed not to open any new accounts for high risk customers while it improved its systems. The FCA found that Starling had breached this agreement by opening 54,359 accounts for 29,193 high or higher risk customers in breach of that agreement.

UK designates Belarusian bank

The UK has designated CJSC Alfa Bank Belarus. Alfa Bank allegedly obtains benefit or supports the Belarusian Government through carrying out its business in the Belarusian financial services sector. This sector is said to be one of strategic significance to the Government of Belarus.

SECO - Ordinance on measures connected with the situation in Ukraine

On 23 September 2024 the Federal Department of Economic Affairs EAER has amended annex 8 to the ordinance on measures connected with the situation in Ukraine (RS 946.231.176.72). The entries concerning 6 individuals have been modified and the entries concerning 8 individuals have been deleted. The measures come into force at 6 pm on 24 September 2024.

Sanctions vis a vis Russia: Commission publishes G7 Industry Guidance on preventing sanctions evasion

Commission published joint guidance developed within the G7 Sub-Working Group on Export Control Enforcement to raise awareness on sanctions evasion risks and indicators and help relevant business operators address and mitigate such risks. The collective aim is to assist industry in identifying Russian evasion practices. Link

UK removes intra-corporate services as a licensing consideration under Russia regs

The UK will remove the licensing consideration relating to UK parent companies/subsidiaries providing services to their Russian subsidiaries (intra-corporate services). The removal will take effect from 31 October 2024. The provision of intra-corporate services will no longer be listed in UK statutory guidance as a licensing consideration likely to be consistent with the aims of the sanctions regime. The change follows a review of the professional and business services sanctions under Reg. 54C of the UK’s Russia Regs.

Trade sanctions against Iran

The UK has issued a notice to exporters on the new Iran trade sanctions implemented by The Iran Regulations 2024. That amendment expanded the list of items subject to sanctions by substituting ‘unmanned aerial vehicle goods’ for ‘goods of strategic concerns’. Link

UK House of Commons approves legislation extending humanitarian exception to Syria sanctions

The UK House of Commons has debated and approved the Syria (Sanctions) (EU Exit) (Amendment) (No. 2) Regulations 2024. The legislation came into force on 31 July 2024.
It expands the humanitarian exception to Syria sanctions to apply to those acquiring, supplying and delivering fuel for humanitarian aid.

Lithuanian authorities seize fire trucks over suspected sanctions breach

In March 2023, Lithuanian authorities seized 17 fire trucks being shipped from Belarus to Zimbabwe. The shipment was suspected to breach EU sanctions against Belarus. Zimbabwean press has reported that the trucks were said to contain components manufactured by a sanctioned Belarusian company. Lithuanian authorities have refused to release the trucks despite Zimbabwe’s diplomatic efforts.

UK sanctions 10 vessels for transporting Russian oil

The UK has sanctioned 10 vessels in Russia’s ‘shadow fleet’, a group of ships that use illicit practices to avoid sanctions on Russian oil. The ships targeted are all ‘high-volume offenders’. These ships will now be barred from entering UK ports and will be refused access to the UK Ship Register. Previous UK action against individual shadow ships have left vessels materially disrupted, with the vast majority of them idling outside ports, and unable to carry on their trade in Russian oil.  

Today’s announcement brings the total number of ‘shadow fleet’ ships specified to 25 and follows the UK’s ‘call to action’ in July which aims to bring a halt to this dangerous trade. The vessels sanctioned today are: 

  • NIKOLAY ZUYEV (IMO 9610781) 
  • NS CLIPPER (IMO 9341081) 
  • NS CORONA (IMO 9341079) 
  • ZALIV ANIVA (IMO 9418494) 
  • OLYMPIYSKY PROSPECT (IMO 9511387) 
  • LEONID LOZA (IMO 9412347) 
  • NS ASIA (IMO 9413561) 
  • SCF BALTICA (IMO 9305568) 
  • VLADIMIR TIKHONOV (IMO 9311622) 
  • SCF VANKOR (IMO 9316127)  
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