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General terms of measures taken within the context of the russian invasion of Ukraine

General terms for the application of Article 6, 5th paragraph of the Council Regulation (EU) No 269/2014 of 17 March 2014 concerning restrictive measures in respect of actions undermining or threatening the territorial integrity, sovereignty and independence of Ukraine

On June 3rd 2022, the National Settlement Depository Russia (NSD) has been added to the list of natural and legal persons, entities and bodies subject to restrictive measures set out in the Council implementing Regulation (EU) 2022/878 of 3 June 2022 implementing Regulation (EU) No 269/2014 concerning restrictive measures in respect of actions undermining or threatening the territorial integrity, sovereignty and independence of Ukraine.

On October 6th 2022, in its eighth package of sanctions, the Council has amended Article 6 ter of the  Regulation (EU) No 269/2014, by adding a fifth paragraph which allows to make available funds held or deposited at NSD:

By way of derogation from Article 2, the competent authorities of a Member State may authorise the release of certain frozen funds or economic resources belonging to the entities listed in Annex I, under the heading 101 (NSD) or the making available of certain funds or economic resources to this entity, under such conditions as the competent authorities deem appropriate and after having determined that such funds or economic resources are necessary for the termination at the latest on january 7th 2023 of operations, contracts, or other agreements, including correspondent banking relations, concluded with this entity before June 3rd 2022.

Article 6 ter 5 is therefore an opportunity for operators to divest from NSD and only applies to the sale of positions held in frozen accounts of NSD and this, in order to terminate the relationship between the applicant and NSD.

As competent authority, the General Administration of Treasury deemed the conditions appropriate for the sale of positions deposited with NSD and frozen in the accounts of a Belgian financial institution, as determined in Article 6 ter 5 of the  Regulation (EU) No 269/2014.

These conditions are as follows:

  1. The waiver request concerns the sale of positions (cash or securities) in the frozen accounts of NSD with a Belgian financial institution.
  2. The commitment of a European operator (guarantor)
  3. A priori reporting (approved by the guarantor) including:
    1. positions to be sold;
    2. full due diligence of the applicants and their beneficial owners;
    3. the payment instructions and due diligence of the persons and entities benefiting from the proceeds of the sale of the positions concerned;
  4. An a posteriori report (approved by the guarantor) on:
    1. the positions actually sold ;
    2. the beneficiaries of the proceeds of sale;
    3. proof that the proceeds of the sale have been deposited in a non-sanctioned entity;
  5. These conditions will be applied in compliance with European legislation (among others the Regulations No. 269/2014 and 833/2014 on financial restrictive measures) provided no other sanctioned entity is involved;
  6. The deadline for submitting applications to the General Administration of Treasury via the e-mail address quesfinvragen.tf@minfin.fed.be is set on January 7th 2023 included.

What happens in case of non-compliance with the terms?

Failure to comply with these conditions will be considered an infraction against the financial sanctions, since pursuant to Article 9 of the Regulation No. 269/2014, it shall be prohibited to participate, knowingly and intentionally, in activities the object or effect of which is to circumvent the measures referred to the article on the freezing or making available of economic resources.

Pursuant to Article 6 of the law of May 13th 2003 as regards the implementation of restrictive measures adopted by the Council of the European Union against States, certain persons and entities, without prejudice to the application of more severe penalties, infringements of measures contained in regulations adopted by the European Union or decisions taken pursuant to such regulations within the framework of Articles 75, 215 and 352 of the Treaty on the functioning of the European Union are punishable by imprisonment of between eight days and five years and a fine of between 25 and 25,000 Euro.

Besides, infringements of the measures contained in the regulations adopted by the European Union or in the decisions taken in application of these regulations within the framework of articles Articles 75, 215 and 352 of the Treaty on the functioning of the European Union may be punished by an administrative fine of between 250 and 2,500,000 Euro imposed by the competent minister.

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A question about the financial sanctions?

You can get in touch with the Treasury to communicate information or ask questions via the e-mail address quesfinvragen.tf@minfin.fed.be.

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