The National Bank of Ukraine (the NBU) has proposed its amendments to the law on sanctions to the Verkhovna Rada’s Committee on Human Rights, National Minorities, and Interethnic Relations.
Specifically, the NBU suggests to establish government controls similar to the controls established by the NBU in 2014.
“As a state authority, the NBU has established a practical framework for applying sanctions in the banking sector. The framework has been in effective use for several years now. We believe that our experience can help other government authorities to effectively apply sanctions to entities that are subject to sanctions,” said Roman Karmazin, Head of Division for Legal Support of Banking Services, Legal Department of the NBU, during his speech at the committee meeting in Verkhovna Rada, where they discussed improving the state policy in applying sanctions to entities involved in illegal political persecution of Ukrainian citizens in the temporarily occupied territories and in the Russian Federation.
The NBU considers the following approaches as most effective:
- independently or together with other restrictions, to apply freezing of assets as one of the most effective sanctions to entities that are subject to sanctions
- to establish government controls over the full implementation of sanctions, which include the order of implementation and means of control over the application of sanctions to entities that are subject to sanctions, based on the NBU’s practice and experience as well as practical approaches of certain foreign authorities (particularly, OFAC – Office of Foreign Assets Control, a financial intelligence and enforcement agency of the U.S. Treasury Department)
- to synchronize the applied sanctions with the similar actions taken by the USA, EU, and Canada to achieve the maximum effect.
Moreover, the NBU suggests that members of parliament amend the law that will enable state authorities to do the following:
- to avoid application of restrictions on obtaining, processing, and transfering personal data of the entities subject to sanctions
- to introduce the “50+1” rule that will enable the authorities to apply sanctions to an entity that owns 50% or more of shares or is owned by other entities (50% of shares or more).
On 4 December 2018, the NBU sent the official letter with its proposals to Hryhoriy Nemyria, Head of the Verkhovna Rada’s Committee on Human Rights, National Minorities and Interethnic Relations.