Belgium Tightens Grip on Financial Sanctions: Freezing Assets of Individuals and Entities Tied to Human Rights Abuses and Terrorism

In a significant move to combat human rights abuses and terrorism, Belgium has strengthened its economic and financial sanctions regime by imposing asset freezes on individuals and entities deemed responsible for serious violations of international law.

EU Regulations and National Implementation

The measures are in line with European Union (EU) regulations, which aim to prevent the financing of pernicious activities by targeting those who have engaged in or supported such actions. According to EU sanctions legislation, asset freezes are imposed on individuals and entities that are part of, or affiliated with, governments of non-EU countries deemed responsible for human rights abuses or international law violations.

Asset Freeze: A Targeted Sanction

The asset freeze is a targeted sanction that consists of two main components:

• Obligation to freeze assets: The obligation to freeze assets and funds belonging to or owned by listed individuals or entities.
• Prohibition on making funds available: Prohibition on making funds and economic resources available directly or indirectly to them.

Exemptions and Derogations

While there are no general exemptions or carve-outs under EU sanctions regulations, the Federal Public Service (FPS) Finance – Treasury may authorise the release of certain frozen funds or economic resources if deemed appropriate. Specific derogations and exemptions include:

• Satisfaction of basic needs
• Payment of legal services
• Wind-down of relations with listed individuals or entities

European Union’s Consolidated List and Belgium’s Sanctioned Individuals/Entities

The European Union publishes a consolidated list of persons, groups, and entities subject to financial sanctions. Belgium has also published its own list of sanctioned individuals and entities. The National Bank of Belgium has issued recommendations on asset freezes for financial institutions.

Reporting Requirements and Cooperation

Businesses that hold assets frozen under sanctions are required to supply information to the FPS Finance – Treasury and cooperate with the Treasury for verification purposes. The EU sanctions regulation on Russia explicitly requires individuals and entities to report all information about funds and economic resources within the European Union belonging to listed individuals or entities that have not been treated as frozen.

Licences and Authorisations

The Belgian government has also empowered its authorities to issue licences to permit activities that would otherwise violate economic and financial sanctions. However, the application process can be time-consuming, with a typical timeline of over one month.

Conclusion

Belgium’s strengthened asset freeze regime aims to disrupt the financing of human rights abuses and terrorism by targeting individuals and entities responsible for such actions. While there are some exemptions and derogations available, businesses must ensure they comply with reporting requirements and obtain necessary authorisations to avoid violating economic and financial sanctions.