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Malta’s Financial Regulation Agencies Cracking Down on International Sanctions
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Malta has implemented robust measures to enforce international sanctions on individuals and entities deemed to be posing a risk to regional or global peace. The National Interest (Enabling Powers) Act serves as the primary legislation governing the implementation of United Nations Security Council Resolutions and European Union Council Regulations imposing sanctions.
Enforcing International Sanctions
Under the Act, individuals and entities that contravene sanctions may face criminal charges punishable by imprisonment and/or fines. The Sanctions Monitoring Board is responsible for ensuring compliance with international sanctions and works closely with financial institutions and other stakeholders to identify and freeze assets connected to designated individuals and entities.
Role of the Sanctions Monitoring Board
Monitoring and Reporting
The Sanctions Monitoring Board monitors the enforcement of sanctions in Malta and makes recommendations for delisting or unfreezing frozen assets. It also reports any findings related to sanctions compliance to the MFSA.
Role of the Malta Financial Services Authority (MFSA)
The MFSA plays a crucial role in enforcing international sanctions, particularly through its Licence Holders. The MFSA requires its licensed entities to exercise vigilance when conducting business activities and to report any findings related to sanctions compliance to the Sanctions Monitoring Board.
Responsibilities of Licence Holders
- Identify and freeze assets connected to designated individuals and entities
- Report any findings related to sanctions compliance to the Sanctions Monitoring Board
Consultation and Professional Advice
The MFSA urges all Licence Holders to consult the appropriate Sanctions Monitoring Board, United Nations, and EU websites for complete and up-to-date information on international sanctions. It also recommends seeking professional advice as necessary.
US Sanctions: A Global Concern
The United States has implemented unilateral sanctions against various countries, individuals, and entities. While these measures differ from those imposed by the United Nations and European Union, MFSA Licence Holders are encouraged to take US sanctions into consideration when conducting business activities due to their wide-ranging applicability.
Office of Foreign Assets Control (OFAC)
The US Treasury Department’s Office of Foreign Assets Control (OFAC) has the authority to impose measures against non-US banks that engage in prohibited transactions with designated persons or entities. Such measures can have significant financial implications for businesses and individuals alike, emphasizing the importance of compliance with international sanctions.
Conclusion
Malta’s financial regulation agencies are committed to enforcing international sanctions and protecting the country from global threats. By understanding the role of the Sanctions Monitoring Board and the MFSA in enforcing these measures, Licence Holders and other stakeholders can ensure compliance and avoid unwittingly supporting activities or individuals that contravene sanctions.