EU Sanctions Measures

EU REGULATION 204/2011 - 2 MARCH 2011

As reported in Club Circulars B. 547 and L. 156 (Political Unrest in Libya and Sanctions Measures), the UN passed UNSCR 1970 (2011) on 26th February 2011, introducing financial sanctions against various persons and entities connected with the Libyan state.  The sanctions include asset freezing measures, an arms embargo, and visa bans. 
 
Pursuant to EU Council Regulation 204/2011 of 2 March 2011 the EU adopted the sanctions measures as set out in the UN Resolution, and in addition, extended the scope of the sanctions measures with the imposition of the visa ban on an additional 10 individuals, and the asset freeze on a further 20 individuals. Annex II of Regulation 204/2011 lists the persons, entities and bodies designated by the UN.  Annex III lists the persons, entities and bodies designated by the EU.

EU IMPLEMENTING REGULATION 360/2011 - 14 APRIL 2011 

With effect from 14th April 2011, and pursuant to EU Council Implementing Regulation 360/2011, the EU sanctions measures were extended to an additional two individuals and twenty six entities.  Annexes II and III of Regulation 204/2011 were replaced by Annexes I and II of Regulation 360/2011. The additional twenty six entities include a number of investment funds, banks, and oil and gas companies, many of which are incorporated outside of Libya, including in the UK, Germany, British Virgin Isles and Isle of Man. 

HMT GUIDANCE ON INTERPRETATION OF EU REGULATIONS - MAY 2011

In May 2011 the UK Treasury office (“HMT”) has indicated to the International Group of P&I Clubs that HMT takes a broad view of the scope of the freezing provisions in relation to funds and economic resources as defined in Regulation 204/2011 and considers that economic resources could include cargoes delivered in Libya to or for the benefit of the individuals and companies listed in Annex II of Regulation 204/2011, and possibly companies associated with them.  Where the trade involves either a shipment to Libya and/or Libyan counterparties, it is advisable to carry out checks on the underlying ownership and control of such trading counterparties, to ascertain whether or not there is a connection with a designated Libyan person or entity.
  
EU IMPLEMENTING REGULATION 502/2011 23 MAY 2011

On 23rd May 2011 the European Council issued EU Implementing Regulation 502/2011 pursuant to which an additional person and an additional entity have been added to the list of persons and entities subject to the asset freeze measures imposed by EU Regulation 204/2011. Details can be found in the Annex to the Regulation. 

EU COUNCIL DECISION 2011/332/CFSP - 7 JUNE 2011

On 7 June 2011 the Council of the European Union adopted a decision to extend the list of persons and entities subject to restrictive measures set out in the annexes to Regulations 204/2011 and 360/2011 to include six port authorities - Tripoli, Al Khoms, Brega, Ras Lanuf, Zawia and Zuwara.  These port authorities have been added to the list of designated entities by reason of their being under the control of the Qadhafi regime.

The asset freeze measures laid down by the EU include the freezing of funds and economic resources held or controlled by designated persons, and a prohibition on making funds, financial assets or economic resources available to listed persons or entities. 

A copy of EU Decision 2011/332/CFSP may be downloaded from the link below.

EU REGULATIONS 572/2011 AND 573/2011 - 17 JUNE 2011

The measures set out in EU Council Decision 2011/332/CFSP entered into force on 17 June 2011 pursuant to EU Regulations 572/2011 and 573/2011.  Any person or entity falling under the jurisdiction of the EU is prohibited from paying port or other fees to the six above-named port authorities for any reason.  The relevant competent authorities of each EU member state have authority under Article 10a of EU Regulation 572/2011 to grant a licence, up until 15 July 2011, to enable fulfilment of contractual obligations that were entered into prior to 7 June 2011, (being the date on which the EU Council passed Decision 2011/332/CFSP).  After 15 July 2011, no licence shall be granted even if the contractual obligation had been entered into prior to 7 June 2011.  The existing contract exemption applies where the means of delivery under the contract involves any of the newly listed ports; the contract need not be with the port itself.  It is important to note, however, that the prior contracts exemption does not apply to contracts relating to oil, gas and refined products. 

A further exemption is available under Article 8a of Regulation 572/2011 for humanitarian shipments, but again, a licence must be obtained from the relevant competent authority.

EU Implementing Regulation 573/2011 has removed one individual, Mustafa Zarti, an Austrian national, from the list of sanctioned entities.  This person is therefore no longer subject to the asset freeze imposed by Regulation 204/2011.

A more detailed article concerning these sanctions, copies of Regulations 572/2011 and 573/2011, and an HMT Guidance Note, may be downloaded from the links below.

EU REGULATION 872/2011 - 1 SEPTEMBER 2011

The National Transitional Council in Libya has affirmed that it has taken control of a number of entities that have been subject to asset freezing measures by the EU.  In view of these developments, the EU has delisted 28 entities from the list of sanctioned entities.  These include the 6 ports of Tripoli, Al Khoms, Brega, Ras Lanuf, Zawia and Zuwara that had been designated on 17 June 2011, and a number of oil companies and commercial banks.  A complete list of the de-listed entities is set out in EU Regulation 872/2011, a copy of which can be downloaded from the link below.

Sanctions remain in place against a number of individuals and entities, details of which can be found in the EU Consolidated List.  Given that the EU asset freeze applies to the economic resources of designated entities or those under their ownership or control, it remains the case that persons and organisations subject to EU law should satisfy themselves that any entities with whom they carry on business, and which are not designated, are not owned or controlled by any person or entity that is designated.

UNITED NATIONS SECURITY COUNCIL RESOLUTION (UNSCR) 2009 DATED 16th SEPTEMBER 2011

On 16th September 2011  the Security Council of the UN by UNSCR 2009 (2011) adopted three decisions:

  • Lifting of sanctions against Libyan National Oil Corporation ("LNOC") and Zuietina Oil Company ("ZOC");
  • Modification of sanctions against Central Bank of Libya, Libyan Arab Foreign Bank, Libyan Investment Authority, and the Libyan Africa Investment Portfolio (each of these entities was listed as an EU sanctions target on 11 March 2011 by reason of being controlled by Colonel Qadhafi); and
  • Licensing of Exemptions in respect of the above entities.

These decisions have now been implemented by subsequent EU Regulations.

EU IMPLEMENTING REGULATION 941/2011 23 SEPTEMBER 2011

Pursuant to Regulation 941/2011 and with effect from 23 September 2011, sanctions measures against  Libyan National Oil Corporation ("LNOC") and Zuietina Oil Company ("ZOC") have been lifted.  LNOC and ZOC had been listed as EU sanctions targets on 24 March 2011 and 14 April 2011 respectively. They are now no longer subject to the asset freeze imposed by Regulation 204/2011.

A copy of Regulation 941/2011 can be downloaded below.

EU REGULATION 965/2011 - 28 SEPTEMBER 2011

EU Regulation 965/2011 gives effect to UNSCR 2009 (2011) by amending various provisions of EU Regulation 204/2011, which is the regulation pursuant to which EU countries adopted sanctions against Libya that were initially endorsed by the UN in February 2011 under UNSCR 1970 (2011).

With effect from 28 September 2011, there is no longer a prohibition on EU persons entering into new transactions involving Central Bank of Libya, Libyan Arab Foreign Bank, Libyan Investment Authority, and the Libyan Africa Investment Portfolio. Any funds, other financial assets and economic resources belonging to, owned, held or controlled directly or indirectly by the aforementioned entities which are received or generated after 16 September 2011 are not subject to asset freeze.

Funds frozen as of 16 September 2011 remain frozen, although Member states may issue licences for such funds to be released for the following purposes:

(i) humanitarian needs;

(ii) fuel, electricity and water for strictly civilian uses;

(iii) resuming Libyan production and sale of hydrocarbons;

(iv) establishing, operating, or strengthening institutions of civilian government and civilian public infrastructure; or

(v) facilitating the resumption of banking sector operations, including to support or facilitate international trade with Libya.

The above dispensation is subject to those funds not being made available to or for the benefit of any person, entity or body as listed in Annexes II and III of Regulation 204/2011 that remain subject to asset freeze measures.

Regulation 965/2011 also relaxes the arms embargo set out in Article 3 of Regulation 204/2011 by allowing Member States to authorise the provision of previously banned goods and technology, and associated brokering and financial services, to Libyan persons, entities and bodies, subject to compliance with notification requirements.

The full text of EU Regulation 965/2011, and an associated HMT Financial Sanctions Notice, can be downloaded below.

UNITED NATIONS SECURITY COUNCIL RELEASE SC/10493 16 DECEMBER 2011

On 16 December 2011, the U.N. Security Council adopted a decision pursuant to UNSCR 1970 (2011) to remove the names of the following entities from its List of Individuals and Entities subject to asset freeze:

  • Central Bank of Libya
  • Libyan Foreign Bank (aka Libyan Arab Foreign Bank)

EU REGULATION 1360/2011 20 DECEMBER 2011

With the implementation of this Regulation, which enters into force in EU Member States from 22 December 2011, the EU has given effect to the UN Security Council Decision of 16 December 2011, to remove the names of Central Bank of Libya and Libyan Arab Foreign Bank from its list of individuals and entities subject to asset freeze at Annex II of EU Regulation 204/2011.

The EU asset freezing measures remain applicable in relation to:

- individuals and entities who remain listed in Annexes II and III of EU Regulation 204/2011;

- entities owned or controlled by individuals listed in UNSCR 1970 (2011) i.e. Colonel Qadhafi and family (the complete UN list can be accessed from this link UN List of Individuals and Entities 1970 (2011)); and

- funds, other financial assets and economic resources which on 16 September 2011 were held outside of Libya by Libyan Investment Authority and Libyan Africa Investment Portfolio.

Members should continue to carry out due diligence on any Libyan-related entities not listed in Annexes II and III of Regulation 204/2011 with whom they may contract to establish that they are not owned or controlled by any individuals or entities listed in the UN List of Individuals and Entities 1970 (2011) i.e. Colonel Qadhafi and family members.  If on the basis of appropriate due diligence, there is no evidence that an entity is so owned or controlled, or there are no reasonable grounds to suspect that it is, members will not be prohibited from dealing with the entity's assets or making funds available to it.

Copies of EU Regulation 1360/2011 and an associated HMT Financial Sanctions Notice dated 19 December 2011 and 22 December 2011 can be downloaded below.

EU COUNCIL DECISION 2013/182/CFSP - 22 APRIL 2013

The EU Council has adopted a decision so as to take account of changes adopted by the UN in view of the changing situation in Libya. Pursuant to the EU Decision, it is permitted to:

  • supply, sell or transfer to persons, entities or bodies in Libya or for use in Libya, non-lethal military equipment or equipment which might be used for internal repression, as well as related technical and financial assistance, intended solely for humanitarian or protective use, subject to advanced approval by the UN Sanctions Committee established pursuant to paragraph 24 of UNSCR 1970 (2011) ("the Committee");
  • supply, sell, or transfer arms and related material as well as related technical and financial assistance, subject to advance notification to the Committee;;
  • supply, sell or transfer protective clothing, including flak jackets and military helmets, temporarily exported to Libya by UN personnel, personnel of the EU or its Member States, representatives of the media and humanitarian and development workers and associated personnel for their personal use only;
  • supply, sell or transfer non-lethal military equipment and technical assistance intended solely for security or disarmament assistance to the Libyan government;
  • supply, sell or transfer arms and related material, intended solely for security or disarmament assistance to the Libyan government, and to supply, sell or transfer small arms, light weapons and related material, temporarily exported to Libya for the sole use of UN personnel, representatives of the media and humanitarian and development workers and associated personnel, subject to advance notification to the Committee.

A copy of the EU Decision can be downloaded from the link set out below.