General Obligations
In the Kingdom of Saudi Arabia, the two key obligations related to proliferation financing and UNSCRs 1718 and successor resolutions are that all persons – natural and legal, including individuals, groups, and entities – must comply with, are:
| 1. Freezing Funds and Economic Resources | 2. Prohibit Making Funds and/or Economics Resources Available |
Any person shall freeze, without delay (i.e. within 24 hrs.) and prior notice, all the funds or economic resources: - Belonging to, wholly or jointly owned, held, or controlled, directly or indirectly by the designated (listed) person, group, or entity designated by the United Nations under UNSCR 1718 or successor resolutions; and/or
- Derived or generated from the funds or economic resources mentioned above.
The obligation to freeze also extends to funds or other assets of persons and entities acting on behalf of, or at the direction of, designated persons or entities. | No person shall make funds or economic resources available or provide financial or other related services, directly or indirectly, wholly or jointly, to or for the benefit of any person, group or entity designated by the United Nations under UNSCR 1718 or successor resolutions. The same applies to persons and entities acting on behalf of, or at the direction of, designated persons or entities, unless licensed, authorized or otherwise notified in accordance with the UNSCRs 1718 or successors resolutions. |
Additional Obligations for any Person (Natural or Legal)
In addition to the two obligations listed under the 'General Obligations' above, any person (natural or legal) must also:
- Notify the relevant supervisory authority within 24 hours from taking a freezing measure, and
- Immediately freeze the following payments or credits made into and from a frozen account:
- Those due under contracts, agreements or obligations that have been concluded or that have arisen before the date the account was frozen.
- Interest rates or returns due on the account.
Additional Obligations for all Financial Institutions, Designated Non-Financial Businesses and Professions
In addition to the two obligations listed under the 'General Obligations' above, all Financial Institutions, and Designated Non-Financial Businesses and Professions must also:
- Regularly and continuously monitor changes and updates to the lists and screen internal data lists, and
- Notify the relevant supervisory authority without delay (within 24 hours) from taking a freezing measure, and
- Inform the relevant supervisory authority as soon as there is a suspicion that a customer, former customer or any person with whom they have or had dealings with, including attempted transactions, is a person, group or entity designated on the UNSC sanctions list, and
- Provide the relevant supervisory authority with information on the status of frozen funds and economic resources and any action taken with respect to these, their nature and quantity of frozen funds or economic resources, and any other information that is relevant thereto, and
- Immediately freeze the following payments or credits made into and, where exceptionally permitted, from a frozen account:
- Those due under contracts, agreements or obligations that have been concluded or that have arisen before the date the account was frozen.
- Interest rates or returns due on the account.
Additional Obligations for Supervisory Authorities
In addition to the two obligations listed under the 'General Obligations' above, all Supervisory Authorities must also:
- Verify that FIs and DNFBPs have in place and effectively implement internal controls and procedures to ensure full compliance with the obligations stipulated in supervisory circulars;
- Verify that FIs and DNFBPs have and effectively implement measures and systems to screen client databases against the list of designations, and that the systems allow for the detection of customers and beneficial owners that are subject to targeted financial sanctions;
- Determine whether and how many cases have been identified by an FI or DNFBP where a customer or beneficial owner was a designated person or entity;
- Determine whether any targeted property has been identified and frozen by a FI or DNFBP;
- Determine whether FIs and DNFBPs have policies and procedures in place that prohibit employees and officers from informing the customer, beneficial owner or any third party in advance that a freezing measure is to be applied;
Targets of Freezing Measures
The freezing measures, including the prohibition of making funds available, apply to the following designated (listed) persons, groups, or entities:
- any person, group or entity designated by the Sanctions Committee of the United Nations Security Council created pursuant to UNSCR 1718.
- anyone who acts on behalf, or at the direction of, or is owned or controlled directly or indirectly by such a person, group, or entity.
Duration of Freezing Measures
Freezing measures have no time limit, meaning that the funds and/or economic resources must remain frozen until the person, group or entity is no longer designated.
