Latvia to Centralize Sanctions Enforcement through Financial Intelligence Unit

New Law Aims to Simplify and Streamline Sanctions Process

In a move aimed at enhancing Latvia’s sanctions enforcement capabilities, the country’s Cabinet of Ministers has approved a draft law that establishes the Financial Intelligence Unit (FIU) as the sole authority responsible for applying exemptions under EU regulations and imposing sanctions.

Key Provisions of the Draft Law

• The FIU will be responsible for making decisions on exemptions and authorizations under EU regulations.
• The unit will assume primary responsibility for enforcing sanctions in Latvia, including issuing binding decisions on freezing assets if a sanctioned person has failed to comply with the requirements of the legislation.
• The FIU will provide guidance to both the private sector and public authorities on the implementation and enforcement of sanctions.
• The unit will coordinate with foreign institutions on related matters.

New Functions for the Financial Intelligence Unit

The FIU’s new responsibilities include:

• Training programs: Providing training sessions for stakeholders on sanctions requirements and procedures.
• Information materials: Developing information materials, such as guidelines and FAQs, to assist stakeholders in understanding sanctions regulations.
• Liaison services: Facilitating communication between the private sector and public authorities.

Ensuring Confidentiality and Legitimate Use of Information

The proposal ensures that information obtained by the FIU remains confidential and can only be used as specified in the relevant legislation. This separation from the FIU’s core functions under the Law on the Prevention of Money Laundering and Terrorism and Proliferation Financing guarantees that sensitive information is handled responsibly.

Next Steps

The draft law will now be reviewed by the Saeima, providing further clarity on this significant development in Latvia’s sanctions enforcement capabilities.