The United Nations Security Council is authorized, under Chapter VII of the UN Charter, to take measures aimed at preserving or restoring international peace and security. Under Article 41, it may impose sanctions that include a wide array of non-military enforcement tools. These sanctions serve as a means to exert pressure without the use of armed force.
Security Council sanctions regimes are primarily focused on facilitating the resolution of conflicts, preventing the spread of nuclear weapons, and countering terrorism. These regimes may involve broad economic and trade restrictions, as well as more specific measures such as arms embargoes, travel bans, and financial or commodity-related restrictions.
Targeted Financial Sanctions are specifically designed to prevent individuals, groups, entities, or undertakings from accessing resources that could support terrorism or the proliferation of weapons of mass destruction. Targeted Financial Sanction measures aim to ensure that no funds, financial assets, or economic resources are made available to designated parties while the sanctions are in effect.
Definition of Targeted Financial Sanctions
The term “targeted sanctions" refers to measures designed to apply selective pressure on specific individuals, entities, groups, or undertakings, rather than broader populations. These sanctions are intended to be precise and strategically focused.
Targeted financial sanctions specifically involve two key components: the freezing of assets and the prohibition of making funds or other assets available—either directly or indirectly—to sanctioned individuals, entities, groups, or undertakings.
There are two primary categories of financial sanctions:
- Asset Freezing: Freezing is the prohibition of any transfer, conversion, disposition, alteration, use, dealing with or movement of funds or economic resources that would result in a change in their volume, amount, location, ownership, possession, nature or destination or that would in any way enable the use of such funds or economic resources for any purpose.
- Prohibition to prevent funds from being made available: Prohibiting to 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 the designated (i.e. listed) person, group or entity.
Definition of 'Funds' 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.
