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17 March 2022 Supervision
Handen bladeren door mappen

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All sanctions list hits must be reported to DNB, not just freeze transactions/sanctions. In this update, we will further discuss the 15 March 2022 sanctions package.

Report all sanctions list hits to DNB

We have found that supervised institutions do not report all sanctions list hits to us. We understand that some institutions assume that they must report only freeze transactions/sanctions to us. This is incorrect, however. If you find that a customer's identity matches that of a natural person or legal entity referred to in the sanctions legislation, you must notify the supervisory authority without delay.

The Regulation on Supervision pursuant to the Sanctions Act 1977 (Regeling Toezicht Sanctiewet 1977 – Rtsw) applies the term 'relationship’ broadly and defines it as any party that is involved in a financial service or financial transaction. You must therefore report all sanctions list hits to us. Some examples of hits that you must report to us:

  • a hit because a sanctioned Russian bank tries to transfer money from a Dutch account at a bank or payment institution
  • a hit because an executive of a payment institution has been sanctioned
  • a hit because an insurer establishes that a customer has been sanctioned and therefore no money should be paid out to the sanctioned customer
  • a hit because a pensioner lives in Russia and banks at a Russian sanctioned bank
  • a hit when a trust service may not or no longer be provided to a sanctioned party
  • a hit because a counterparty to a crypto transaction has been sanctioned

Since correct information on sanctions is of great importance given the situation in Ukraine, we expect all sanction notifications specifically related to the situation in Ukraine/Russia to be submitted to us with retroactive effect from 23 February 2022. We wish to receive these by 21 March 2022. You must immediately report all new sanctions list hits to ussancties@dnb.nl. If you cannot meet the deadline of 21 March 2022, you should contact your supervisor.

The Ukraine/Russia situation is unusual and is resulting in a considerable amount work for institutions. For this reason, institutions may submit bulk reports on Russia/Ukraine/Belarus in an Excel sheet for the next two months (until 16 May). The Excel sheet must contain answers to all questions on the standard report form. 

Sanctions against Russia

On 15 March 2022, the European Council decided to impose a fourth package of economic and individual sanctions in response to Russia’s military aggression against Ukraine. The Council of the EU decided in particular to:

  • prohibit all transactions with certain state-owned enterprises
  • prohibit the provision of credit rating services to any Russian person or entity, including a ban on access to any subscription services in relation to credit rating activities
  • expand the list of persons connected to Russia's defence and industrial base, on whom tighter export restrictions are imposed regarding dual-use goods and goods and technology which might contribute to Russia’s technological enhancement of its defence and security sector.
    Those listed include key oligarchs Roman Abramovich and German Chan, among other prominent businessmen involved in key economic sectors such as iron and steel, energy, banking, media, military equipment and dual-use products and services. The list also includes lobbyists and propagandists, such as Konstantin Ernst (CEO of Channel One Russia), pushing the Kremlin’s narrative on the situation in Ukraine
  • prohibit new investments in the Russian energy sector, as well as introduce a comprehensive export restriction on equipment, technology and services for the energy industry
  • introduce further trade restrictions concerning iron and steel, as well as luxury goods.

In total, there are now EU sanctions in place against 877 individuals and 62 entities. Their assets have been frozen and EU citizens and companies are no longer allowed to provide them with funds. In addition, natural persons are subject to a travel ban, which prevents them from travelling to or through EU territory. The Council recently decided to extend the sanctions against those responsible for undermining or threatening the territorial integrity, sovereignty and independence of Ukraine for another six months, until 15 September 2022.

You can find a timeline of restrictive EU measures in response to the crisis in Ukraine here.

What institutions supervised by DNB must do

Read this article on what your obligations are for complying with the Sanctions Act and what you should do if you encounter a hit In short, we expect you to act as follows:

  • Check whether these regulations apply, for example, to your clients, members or investments made.
  • If they do, immediately act in compliance with the regulations’ orders and prohibitions.
  • If you find that the identity of a business relation matches that of a person or entity mentioned in the sanctions regulations (a “hit”), you must notify us immediately, using the prescribed notification form. Please email the form to us at sancties@dnb.nl. You can download the report form from this page: Getting around in sanctions regulations.
  • If DNB has any questions about your notification, you should answer them immediately.
  • In certain cases, a “hit” can be regarded as an unusual transaction within the meaning of the Anti-Money Laundering and Anti-Terrorist Financing Act (Wet ter voorkoming van witwassen en financiering van terrorisme – Wwft). If so, report this transaction to FIU-the Netherlands.

This is an additional news service. Institutions retain the responsibility to stay abreast of and comply with sanctions legislation in a timely and accurate manner. We realise that a lot is being asked of you and that the changes in sanctions are taking place in rapid succession.

We also distribute regular email updates on the UN, EU and Dutch sanctions regimes. If you want to subscribe, you can sign up for our news service. We sent out an email update on 16 March. Click here to read this message.

Sector(s)

  • Banks
  • Crypto service providers
  • Electronic money institutions
  • Insurers
  • Payment institutions
  • Pension funds
  • Premium Pension institutions
  • Trust offices