EU Sanctions Updates 2013
COUNCIL REGULATION 325/2013 OF 10 APRIL 2013
With the publication of EU Implementing Regulation 325/2013 (“the Amending Regulation”) of 10 April 2013, and with effect from 12 April 2013, the EU has amended certain of the trade and financial sanctions set out in Regulation 36/2012.
Articles 2 and 3 of Regulation 36/2012 are amended to include derogations from the prohibitions in respect of sale, supply, transfer or export, and the provision of related technical, financing and financial assistance, of equipment which might be used for internal repression. Article 2(3) of EU Regulation 36/2012 is amended to provide that the competent authority of a Member State may authorise such activities where such equipment is intended for humanitarian or protective use or for institution building programmes of the United Nations and of the EU, or for the EU and UN crisis management operations; or in the case of the Syrian National Coalition for Opposition and Revolutionary Forces such equipment is non-lethal and is intended for the protection of civilians.
A new Article 3a is inserted into EU Regulation 36/2012 to prohibit the provision, directly or indirectly, of financing or financial assistance relating to the goods and technology listed in the Common Military List, including financial derivatives, as well as insurance and reinsurance and brokering services relating to insurance and reinsurance for any purchase, import or transport of such items if they originate in Syria, or are being exported from Syria to any other country, and to participate, knowingly or intentionally, in activities the object or effect of which is to circumvent such prohibitions.
A new paragraph (c) to Article 19(1) of Regulation 36/2012 amends the prohibition in Article 14 of Regulation 36/2012 on making funds or economic resources available, directly or indirectly, to or for the benefit of designated natural or legal persons, entities or bodies, such that it does not apply to the addition to frozen accounts of payments due under judicial, administrative, or arbitral decisions rendered in a Member State or enforceable in the Member State concerned.
The Amending Regulation adds a new licensing ground to Article 16 of Regulation 36/2012, such that the relevant competent authority of a Member State may authorise the release of certain frozen funds or economic resources, or the making available of certain funds or economic resources, under such conditions as the competent authority may deem appropriate, after having determined that the funds or economic resources are necessary to ensure human safety or environmental protection.
Copies of the Amending Regulation and an associated HMT Financial Sanctions Notice can be downloaded from the links set out below.
EU COUNCIL AMENDING DECISION 2013/186/CFSP - 22 APRIL 2013
The Council has adopted this decision to ease certain EU sanctions measures with the aim of helping the Syrian civilian population and supporting the Syrian National Coalition for Opposition. Once implemented, Competent Authorities of EU Member States may authorise the:
- purchase, import or transport of crude oil and petroleum products from Syria and related financing or financial assistance as well as insurance and reinsurance;
- sale, supply or transfer of key equipment and technology for the oil and natural gas industry in Syria as well as their sale or supply to Syrian and Syrian owned companies outside Syria and the provision of related technical assistance or training and other services as well as financing or financial assistance;
- grant of a financial loan or credit to, or the acquisition or extension of a participation in enterprises in Syria engaged in the Syrian oil industry or the creation of any joint venture with enterprises in Syria and companies they control which are engaged in the Syrian oil industry. For authorisation to be granted the activities
(i) must not directly or indirectly be for the benefit of designated entity; and
(ii) must not breach any other provisions of the existing sanctions in respect of Syria.
This Decision remains to be implemented via a Council Regulation.
EU REGULATION 697/2013 – 22 JULY 2013
Council Regulation (EU) No 697/2013 of 22 July 2013 has been issued, amending various provisions contained in EU Regulation 36/2012 of 18 January 2012.
Articles 2 and 2a of Regulation 36/2012 (which were previously amended in April 2013 pursuant to EU Regulation 325/2013) are further amended to widen the list of equipment, goods and technology which might be used for internal repression as listed in Annex IA, or for the manufacture and maintenance of products which might be used for internal repression, whether or not originating in the Union and which are either prohibited or subject to prior authorisation for the sale, supply, transfer or export to any person, entity or body in Syria or for use in Syria.
Derogations are provided for in amended Article 2a in respect of equipment, goods and technology listed in Annex IA, where the goods in question are intended for food, agricultural, medical or other humanitarian purposes, or for the benefit of United Nations personnel or personnel of the European Union or its Member States; and, subject to meeting the same criteria, in respect of the provision of related technical assistance or brokering services, or financing or financial assistance.
EU Member States may also now provide further authorisations for prohibited activities if their competent authority determines that it is reasonable to conclude that the activities concerned:
(i) are for the purpose of providing assistance to the Syrian civilian population; in meeting humanitarian concerns; assisting in the provision of basic services, reconstruction or restoring economic activity; or other civilian purposes;
(ii) do not entail funds or economic resources being made available directly or indirectly to or for the benefit of a person, entity or body designated for asset freeze referred to in Article 14.
(iii) do not breach any of the prohibitions laid down in EU regulations regarding Syria.
Provided the above criteria are met, the following may be authorised:
Under Article 6A of EU Regulation 36 as amended, the import into the EU, purchase or transport of Syrian-origin crude oil or petroleum products, or the provision of related financing or financial assistance, including financial derivatives as well as insurance and reinsurance.
Under amended Article 9A, the sale, supply, transfer or export directly or indirectly to any Syrian person, entity or body, or for use in Syria, of key equipment or technology as listed in Annex VI for key sectors of the oil and gas industry in Syria (namely exploration and production of crude oil and natural gas, refining, and liquefaction of natural gas), or the provision of related technical assistance or brokering services or financing or financial assistance.
Under amended Article 13A, the granting of any financial loan or credit to, or the acquisition or extension of a participation in, or the creation of any joint venture with, any Syrian person, entity or body engaged in the exploration, production or refining of crude oil.
Under amended Article 25A, the opening by any credit and financial institution subject to EU regulation of a new bank account or a new representative office with any Syrian credit or financial institution, or the establishment of a new branch or subsidiary in Syria.
Copies of the new Regulation, and an associated HMT Financial Sanctions Notice, can be downloaded from the links set out below.
EU REGULATION 1332/2013 - 13 DECEMBER 2013
On 13 December 2013, the EU Council passed Regulation 1332/2013, which with effect from 15 December 2013, amends a number of the existing prohibitions in respect of EU-Syria sanctions as set out in EU Regulation 36/2012 dated 18 January 2012 (“the principal regulation”), and creates a new prohibition. The new regulation appears to have the following aims:
(1) To enable EU Member States to support the activities of the Organisation for the Prohibition of Chemical Weapons to eliminate chemical weapons in Syria in accordance with UN Security Council Resolution 2118 (2013);
(2) To facilitate the United Nations delivery of humanitarian aid to Syria;
(3) To allow the processing of payments for medical supplies, food, shelter and sanitation for civilian use.
There is also a new prohibition on trade in items of archaeological, historical, cultural, scientific and religious importance to Syria.
Various new derogations are included in Articles 2 and 3 of EU Regulation 36 (subject to authorisation by the relevant competent authority) in relation to the existing prohibitions on sale, supply, transfer or export of equipment, goods and technology for internal repression and Common Military List goods and technologies, and related financing, financial assistance and insurance/reinsurance, subject to the provision of such equipment goods and technology being undertaken in accordance with paragraph 10 of UN Security Council Resolution 2118(2013) and relevant decisions of the Executive Council of the Organisation for the Prohibition of Chemical Weapons (OPCW), consistent with the objective of the Convention on the Prohibition of the Development, Production, Stockpiling and Use of Chemical Weapons and on their Destruction (Chemical Weapons Convention) and after consultation with the OPCW. The UN resolution was passed in September 2013 and one of its objectives is to assist relevant authorities such as the Organisation for the Prohibition of Chemical Weapons to eliminate chemical weapons from Syria.
Article 11c sets out a new prohibition on import, export or transfer of objects related to Syria’s cultural heritage and the provision of related brokering services.
The humanitarian exception in Article 16 to the asset freeze is restated so that funds can be made available to the UN, for purposes related to the Syria Humanitarian Assistance Response Plan (SHARP);
There is a new derogation in Article 21 enabling payments to be made through the Commercial Bank of Syria where the transfer is related to a payment for the purpose of meeting essential civilian needs, or due in connection with a specific trade contract, for medical supplies, food, shelter, sanitation or hygiene for civilian use.
A copy of the Regulation, and an associated HMT Financial Sanctions Notice can be downloaded from the links set out below.