On 1 August 2014, the EU imposed restrictions on capital transactions with Russia (Regulation 833/2014). The EU also added 11 natural persons or legal entities to the freeze list (Regulation 284/2014).
These sanctions are significant for financial undertakings that are subject to supervision by The Netherlands Authority for the Financial Markets (AFM) pursuant to the Sanctions Act 1977, specifically, collective investment schemes and investment firms. The AFM has informed these undertakings about the sanctions in a letter (Dutch only).
Regulation 833/2014 concerns capital market transactions involving a number of financial undertakings designated by the EU. The sanctions also apply to financial services for the purchase and export of dual-use goods or technology, technology for use in the oil industry, and goods or technology as included on the EU’s Common Military List.
Obligation to notify
It is important for you to study the regulation thoroughly to determine whether these new sanctions have implications for your financial undertaking. If they do, measures need to be adopted to prevent your company acting in contravention of the sanctions.
The Sanctions Act 1977 also mandates that a financial undertaking must immediately notify the AFM if the identity of a client corresponds to a natural person or legal entity to which the sanctions apply. In the case of an intended transaction, this must be reported to the Financial Intelligence Unit - Netherlands (FIU- Netherlands) as well.
The AFM and De Nederlandsche Bank (DNB) supervise compliance with sanctions by the Dutch financial sector. They monitor the procedures and measures that financial undertakings adopt to ensure compliance with them.
In the case of a violation, the supervisors can impose an order for incremental penalty payments or an administrative penalty on an undertaking. They can also press criminal charges. Notifications received by the DNB and the AFM are assessed and if necessary investigated further.
The AFM promotes fairness and transparency within financial markets. We are the independent supervisory authority for the savings, lending, investment and insurance markets. We promote the fair and conscientious provision of financial services to consumers and private investors, as well as professional and semi-professional parties. We supervise the fair and efficient operation of the capital markets. Our aim is to improve consumers’ and companies' confidence in the financial markets, both in the Netherlands and abroad. In performing this task, the AFM contributes to the stability of the financial system, the economy and the reputation and prosperity of the Netherlands.
The AFM is committed to promoting fair and transparent financial markets.
As an independent market conduct authority, we contribute to a sustainable financial system and prosperity in the Netherlands.