1. What are "targeted financial sanctions" (TFS)?
Targeted financial sanctions refer to restrictive measures applied to specific individuals, organizations, or groups. TFS generally involve two key components: the immediate freezing of assets and the prohibition of providing, either directly or indirectly, any funds, financial assets, or services to or for the benefit of those listed.
2. What is the objective of Targeted Financial Sanctions related to Terrorism and Terrorist Financing?
The United Nations, through its Security Council Resolutions and Sanctions Committees, works to uphold global peace and security by requiring the enforcement of asset freezing measures targeting terrorism and terrorism financing. By issuing resolutions that aim to block access to financial resources by terrorists and terrorist groups, targeted financial sanctions serve to restrict the flow of funds and capital associated with terrorism efforts.
3. Who is subject to having their assets frozen under the Targeted Financial Sanctions regime?
All persons – natural and legal, including individuals, groups, and entities - designated by the UN Security Council, a relevant Security Council Sanctions Committee or by the Kingdom of Saudi Arabia's Public Prosecution.
The lists of designated persons, groups and entities can be accessed under the following websites:
4. What does the term 'freezing' entail?
Freezing means preventing any movement, transfer, or use of funds or assets belonging to, or under the control of, a person, group, or entity named in the Sanctions Lists.
5. What is meant by 'without delay'?
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Without delay" means that freezing actions must be taken immediately after confirming a match with the Sanctions Lists—or, at the latest, within 24 hours of the designation of the individual, group, or entity.
6. What assets are subject to a freezing obligation?
Targeted financial sanctions require the freezing of “all funds and other financial assets and economic resources".
Funds are: Any type of assets or property regardless of its value, nature, or the way it is acquired, whether electronic or digital, whether inside or outside the Kingdom of Saudi Arabia, including any profits or interests on such property that is due or has been fully or partially distributed. This includes local and foreign currency, financial and commercial instruments, immovable or movable, tangible or intangible, and corporeal or incorporeal assets and all the rights or interests vested therein, deeds and documents evidencing all the above, including bank credits, deposits, postal drafts, bank drafts, and letters of credit.
This includes virtual and electronic currency, insurance and reinsurance, all types of financial commitments, shares in the business of an individual trader or a partnership, debts, and debt obligations.
Economic resources are: Assets of any kind, whether tangible or intangible, movable or immovable, actual or potential, which may be used to obtain funds, goods or services, including, but not limited to: equipment, furniture, fittings and fixtures; any material of a fixed nature such as vessels, aircraft and motor vehicles; inventories of goods; arts; jewelry and gold; goods including oil, refined products, modular refineries and related material including chemicals, lubricants, minerals or timber or other natural resources; arms and related materials, raw materials and components that can be used to manufacture improvised explosive devices and unconventional weapons; patents, trademarks, copyrights and other forms of intellectual property, internet hosting and related services.
7. Who`s assets need to be frozen?
Targeted financial sanctions (i.e. freezing measures as well as the prohibition of making funds available) apply not only to assets that are directly owned by designated persons, groups or entities, but to all assets that, either directly or indirectly, are owned or controlled by them or by persons acting on their behalf, and also includes any funds or negotiable benefits arising from them.
8. What needs to be done if targeted assets are detected?
Any and all persons in the Kingdom of Saudi Arabia are under a direct obligation to freeze assets attributed to a designated person, group or entity, legal or natural persons. This needs to occur without delay, and includes:
- Freezing the detected assets, and
- Not dealing with or making them available to directly or indirectly, or for the benefit of, the designated person.
In addition, any person, natural or legal, must notify the Permanent Committee for Countering Terrorism within 24 hours from taking a freezing measure.
9. How do I notify the Permanent Committee for Countering Terrorism after having taken a freezing measure?
Once a freezing measure has been taken, the person implementing the freezing measure should send a report to the Permanent Committee for Countering Terrorism that includes:
- The designated person identified,
- The type of asset frozen,
- Information regarding the designated person
- Any other relevant information or accompanying documents
10. How long do assets have to remain frozen?
Freezing measures have no time limit, meaning that the funds or economic resources must remain frozen until the person, group or entity is removed from the UNSCR 1267 list, the UNSCR 1988 or until the PCCT lifts the freezing measure.
11. Are transfers to frozen accounts permitted?
Financial institutions may credit frozen accounts with interest or other earnings on those accounts; or with payments due under contracts, agreements or obligations, provided that any additions to such accounts shall also be frozen.
In cases where such transfers occur, financial institutions have to inform the Permanent Committee for Countering Terrorism without delay after the frozen account has been credited.
12. Can I be held liable by any person, including the customer, for freezing his or her assets pursuant to the relevant targeted financial sanctions?
No individual shall be held criminally, civilly, or administratively liable for any loss or claim arising from the freezing of funds or assets, or from the refusal to provide such funds or financial services, provided the action was taken in good faith and in compliance with obligations related to freezing measures and the prohibition of making funds available to individuals or entities involved in terrorism or terrorist financing.
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