Sanctions Implementation

Overview

Targeted financial sanctions must be implemented in accordance to the relevant UNSC Resolutions, including the UN Consolidated List, and the Local Terrorist List.

There are four main obligations on all persons, natural or legal in the UAE to implement Targeted Financial Sanctions (TFS):

All natural and legal persons in the UAE must comply with the following general obligations:

1. Register: Register at the Executive Office website to receive automated email notifications by.
2. Screen: Daily screen the UN Consolidated List and the Local Terrorist List to identify possible matches between the individuals or legal entities listed and your customers, potential customer, and beneficial owners.
3. Apply Targeted Financial Sanctions:
   1. Freezing of all funds: Freeze, without delay (within 24 hours) and without prior notice, all the funds:
      1. Owned or controlled, wholly or jointly, directly, or indirectly, by a individual or legal entity designated by the UAE Cabinet or pursuant to a relevant UNSC Resolution;
      2. Derived or generated from funds under item (a); or
      3. Individuals or legal entities acting on behalf of or at the direction of a individual or legal entity designated by an individual or legal entity designated by the Local Terrorist or pursuant or the United Nations consolidated list.
   2. Prohibition of making funds available: No individual or legal person in the UAE is permitted to provide funds to or render financial services or other services related to, whether in whole or in part, directly or indirectly or for the benefit of any individual or legal entity listed in the Local Terrorist List or the UN Consolidated List pursuant to a relevant UNSC Resolution.
   3. Certain exceptions may apply, upon submitted request and written authorization from the Executive Office of the Committee for Goods and Materials Subject to Import and Export Control, applicable authority or in accordance with Cabinet decisions.
   Important Frozen accounts can be credited with:
   • interest, profits or other earnings due on the account; and
   • payments due under contracts, agreements or obligations agreed upon prior to the date on which the individual or legal entity was designated,
   • provided such additions are immediately frozen, and the respected Supervisory Authority is informed immediately.
4. Notify:
   1. Financial institutions and DNFBPs must report within 2 business days from taking any freezing measure and/or attempted transactions to the relevant Supervisory Authority.
   2. Any other individual or entity must notify within 2 business days from taking any freezing measure and/or attempted transactions to the Executive Office. Please refer to the contact information provided at the end of this guidance document.

Who is the target of these measures?

The freezing measures, including the prohibition of making funds available, apply to:

1. Any individual, group, or legal entity listed in the Local Terrorist List defined by the Federal Cabinet or listed by the UNSC in its Consolidated Sanctions List.
2. Any legal entity, directly or indirectly owned or controlled by an individual or legal entity listed under A.
3. Any individual or legal entity acting on behalf of or at the direction of any individual or legal entity listed under A & B.

Important: Any percentage of ownership must trigger a freezing measure. Equally, freezing measures must be implemented when there is any information or indication that there are funds controlled (directly or indirectly) by the listed individual, group, or legal entity.

The list of individuals, or legal entities is subject to change. The most updated information can be found in the following links:

1. The UN Security Council has a Consolidated List of all the sanctioned individuals, groups, or legal entities by the UN Sanctions Committees (UN List). The link to this list is: https://www.un.org/securitycouncil/content/un-sc-consolidated-list.
2. Any individual or legal entity listed by the UAE (Local Terrorist List): The link to the filorist List: https://www.uaeiec.gov.ae/API/Upload/DownloadFile?FileID=2017e120-bb9f-4e17-ae49-f13984c70a1f

How to identify a match to apply TFS?

Financial Institutions and Designated Non-Financial Businesses and Professions in the UAE (including free zones) must screen constantly their customers, potential customers, beneficial owners and transactions to identify possible matches to the Local Terrorist List or UN Consolidated List. Both Lists contain a range of information to aid the identification of designated individual or legal entity, the following are examples of the information contained in the lists:

Because many names are very common, you may find various Potential Matches. However, it does not necessarily mean that the individual or legal entity you are dealing with is subject to TFS.

When identifying the potential match, suspend any transaction until you can be satisfied it is not an individual or legal entity subject to TFS (False Positive Result).

Then by taking into consideration the knowledge you have of the customer, potential customer beneficial owner, or transaction, through customer due diligence (CDD) and/or using reasonable information, if you are satisfied that the individual or legal entity with a potential match not subject to TFS, you do not need to implement any measure, you may allow the transaction or business to continue its normal course and you are required to maintain evidence of this process in their records.

However, if there is any indication or suspicion that the potential match may be a Confirmed Match or there is actually a confirmation that is it a true match, then you must implement the freezing measures without delay, refrain from offering any funds or services, and notify immediately relevant Supervisory Authority or the Executive Office (when there is no Supervisory Authority appointed).

Note that: If the individual or legal entity you are dealing with matches all or most of the information on any of the Lists, then this is likely to be a true match. In this case you must implement the freezing measures immediately, refrain from offering any funds or services, and notify immediately relevant Supervisory Authority or the Executive Office (when there is no Supervisory Authority appointed).

The designated individuals, groups or legal entities can be found in the following links:

Local Terrorist List

Overview

All UN member states must implement freezing measures with regards to individuals or legal entities designated by the UNSC. In addition, UNSC Resolution 1373 (2001) mandates each UN member state to develop the procedures to identify and apply freezing measures with regards to individuals or legal entities that are suspected of, attempt to, and/or commit terrorist acts.

In the UAE, the Supreme Council for National Security (Supreme Council) prepares such designations. Specifically, the Supreme Council proposes a Local List that meets the designation criteria required by UNSC Resolution 1373 (2001). The Supreme Council can include individuals or legal entities in that list without prior notice, and irrespective of whether criminal proceedings exist. Each listing must be approved by the Cabinet of the UAE.

International cooperation pursuant UNSCR 1373 (2001)

Sending a designation request

The Supreme Council may unilaterally request a foreign country to designate and/or to apply freezing measures to an individual or legal entities that meets the criteria for listing under UNSC Resolution 1373 (2001). The listing proposal may include the following:

1. Specific information establishing links to terrorist individuals, and legal entities or activities or otherwise establishing that the individuals or legal entities meets the designation criteria.
2. Evidence or documents supporting the listing proposal, such as reports of law enforcement authorities, security authorities, the judiciary, media or others.

Receiving a designation request

Any foreign country may request the Supreme Council to include in the Local List an individual and legal entity that is suspected or believed to meet the designation criteria under UN Security Council Resolution 1373 (2001).

The Supreme Council shall determine without delay whether it is satisfied that the proposed designee meets these designation criteria and present it for consideration and decision to the Cabinet.

Updating & Re-listing

The Supreme Council shall conduct periodic reviews of the Local List, in coordination with the Ministry of Justice and based on information from Law Enforcement Authorities (LEAs) and other relevant agencies in the UAE.

If the Supreme Council considers that there are no longer reasonable grounds to believe that an individual or legal entity in the Local List meets the designation criteria, the Supreme Council shall de-list that individual or legal entity after approval by the Cabinet.

Sanctions Implementation

Overview

Targeted financial sanctions must be implemented in accordance to the relevant UNSC Resolutions, including the UN Consolidated List, and the Local Terrorist List.

There are four main obligations on all persons, natural or legal in the UAE to implement Targeted Financial Sanctions (TFS):

All natural and legal persons in the UAE must comply with the following general obligations:

1. Register: Register at the Executive Office website to receive automated email notifications by.
2. Screen: Daily screen the UN Consolidated List and the Local Terrorist List to identify possible matches between the individuals or legal entities listed and your customers, potential customer, and beneficial owners.
3. Apply Targeted Financial Sanctions:
   1. Freezing of all funds: Freeze, without delay (within 24 hours) and without prior notice, all the funds:
      1. Owned or controlled, wholly or jointly, directly, or indirectly, by a individual or legal entity designated by the UAE Cabinet or pursuant to a relevant UNSC Resolution;
      2. Derived or generated from funds under item (a); or
      3. Individuals or legal entities acting on behalf of or at the direction of a individual or legal entity designated by an individual or legal entity designated by the Local Terrorist or pursuant or the United Nations consolidated list.
   2. Prohibition of making funds available: No individual or legal person in the UAE is permitted to provide funds to or render financial services or other services related to, whether in whole or in part, directly or indirectly or for the benefit of any individual or legal entity listed in the Local Terrorist List or the UN Consolidated List pursuant to a relevant UNSC Resolution.
   3. Certain exceptions may apply, upon submitted request and written authorization from the Executive Office of the Committee for Goods and Materials Subject to Import and Export Control, applicable authority or in accordance with Cabinet decisions.
   Important Frozen accounts can be credited with:
   • interest, profits or other earnings due on the account; and
   • payments due under contracts, agreements or obligations agreed upon prior to the date on which the individual or legal entity was designated,
   • provided such additions are immediately frozen, and the respected Supervisory Authority is informed immediately.
4. Notify:
   1. Financial institutions and DNFBPs must report within 2 business days from taking any freezing measure and/or attempted transactions to the relevant Supervisory Authority.
   2. Any other individual or entity must notify within 2 business days from taking any freezing measure and/or attempted transactions to the Executive Office. Please refer to the contact information provided at the end of this guidance document.

Who is the target of these measures?

The freezing measures, including the prohibition of making funds available, apply to:

1. Any individual, group, or legal entity listed in the Local Terrorist List defined by the Federal Cabinet or listed by the UNSC in its Consolidated Sanctions List.
2. Any legal entity, directly or indirectly owned or controlled by an individual or legal entity listed under A.
3. Any individual or legal entity acting on behalf of or at the direction of any individual or legal entity listed under A & B.

Important: Any percentage of ownership must trigger a freezing measure. Equally, freezing measures must be implemented when there is any information or indication that there are funds controlled (directly or indirectly) by the listed individual, group, or legal entity.

The list of individuals, or legal entities is subject to change. The most updated information can be found in the following links:

1. The UN Security Council has a Consolidated List of all the sanctioned individuals, groups, or legal entities by the UN Sanctions Committees (UN List). The link to this list is: https://www.un.org/securitycouncil/content/un-sc-consolidated-list.
2. Any individual or legal entity listed by the UAE (Local Terrorist List): The link to the filorist List: https://www.uaeiec.gov.ae/API/Upload/DownloadFile?FileID=2017e120-bb9f-4e17-ae49-f13984c70a1f

How to identify a match to apply TFS?

Financial Institutions and Designated Non-Financial Businesses and Professions in the UAE (including free zones) must screen constantly their customers, potential customers, beneficial owners and transactions to identify possible matches to the Local Terrorist List or UN Consolidated List. Both Lists contain a range of information to aid the identification of designated individual or legal entity, the following are examples of the information contained in the lists:

Because many names are very common, you may find various Potential Matches. However, it does not necessarily mean that the individual or legal entity you are dealing with is subject to TFS.

When identifying the potential match, suspend any transaction until you can be satisfied it is not an individual or legal entity subject to TFS (False Positive Result).

Then by taking into consideration the knowledge you have of the customer, potential customer beneficial owner, or transaction, through customer due diligence (CDD) and/or using reasonable information, if you are satisfied that the individual or legal entity with a potential match not subject to TFS, you do not need to implement any measure, you may allow the transaction or business to continue its normal course and you are required to maintain evidence of this process in their records.

However, if there is any indication or suspicion that the potential match may be a Confirmed Match or there is actually a confirmation that is it a true match, then you must implement the freezing measures without delay, refrain from offering any funds or services, and notify immediately relevant Supervisory Authority or the Executive Office (when there is no Supervisory Authority appointed).

Note that: If the individual or legal entity you are dealing with matches all or most of the information on any of the Lists, then this is likely to be a true match. In this case you must implement the freezing measures immediately, refrain from offering any funds or services, and notify immediately relevant Supervisory Authority or the Executive Office (when there is no Supervisory Authority appointed).

The designated individuals, groups or legal entities can be found in the following links:

Liability

A Person who, in good faith, freezes funds, denies disposal thereof, or refuses to provide financial services relating to listed individual, group or entity, or declined to perform any other obligation in compliance with the provisions of Cabinet Resolution No. 74 of 2020 shall be exempt from any damages or claims, resulting from such actions, including penal, civil, and/or administrative liability.

Freezing Measure Duration

Asset freezing and prohibition measures have no time limit: : the funds must remain frozen, and the prohibition to offer funds and services stands until the individual, group, or entity is removed from the Local Terrorist List or the UN List or until there is a freezing cancellation decision made by a competent authority or the UN Sanctions Committee.

Other Measures

UNSC resolutions and Cabinet Resolution may include other Sanction measures, such as prohibitions relating to travel, delivering weapons, imports, or provision of fuel supplies and other. Such measures must be implemented as well.

Additional Obligations of Financial Institutions and DNFPBs

Supervision

Certain legal entities, notably Financial Institutions (FI) and Designated Non-Financial Businesses and Professions (DNFBP), must comply with specific requirements promulgated under article 21 of Resolution 74. Supervisory Authorities will supervise and in case of identifying a non-compliance, they can apply the enforcement actions set out under the Federal Decree Law AML/CFT (20/2018).

Sanction Evasion

Overview

Sanctions Evasion is any attempt to disguise or conceal the involvement of sanctioned individuals, entities, or groups in a transaction or series of financial or non-financial transactions or services to avoid financial sanctions imposed by United Nations or Local Terrorist List.

FIs, DNFBPs, and VASPs should ensure to apply proactive measures to identify sanction evasion transactions through understanding the emerging threats and vulnerabilities that can be abused by terrorist financers or proliferators, conducting proper CDD and maintaining up to date sanctions lists, raising awareness of sanction evasion techniques and submitting suspicious PF or TF transactions to the FIU via goAML.

In order to combat sanction evasion schemes, the private sector should work closely with the public sector by building private public partnerships and effective interagency cooperation and sharing of information.

Sanction Evasion’s Red Flags and Typologies

The EOCN As a focal point for implementing the Targeted Financial Sanctions published a list of Red flags and typologies which aims to assist the private and public sectors to identify suspicious transactions related to sanction evasion. The EOCN encourages the private sector to integrate these red flags within their alerting systems as a part of internal controls for combating TF and PF sanction evasion. These red flags were prepared following thorough analysis of the TF and PF cases that occurred in the UAE and other regional countries as follows:

TF- Sanction Evasion Red flags and Typologies

• Carrying out cash withdrawals in short succession (potentially below the daily cash reporting threshold) across various locations in territories where sanctioned people have influence or are on the border of sanctioned countries.
• Funds are sent or received via international transfers from or to higher-risk locations.
• Foreign exchange transactions are performed on behalf of a customer by a third party, followed by funds transfers to locations having no apparent business connection with the customer or to higher-risk countries.
• The use of multiple personal and business accounts or the accounts of non-profit organizations or charities to collect and funnel funds to a small number of foreign beneficiaries.
• Transactions involve individual(s) or entity(ies) identified by media and/or Sanctions List as being linked to a terrorist organization or terrorist activities.
• Individual or entity’s online presence supports violent extremism or radicalisation.
• Irregularities during the CDD process which could include, but is not limited to:
  • Inaccurate information about the source of funds and/or the relationship with the counterparty.
  • Refusal to honour requests to provide additional KYC documentation or to provide clarity on the final beneficiary of the funds or goods.
  • Suspicion of forged identity documents
• Transactions involve individual(s) or entity(ies) identified by media and/or Sanctions List as being linked to a terrorist organization or terrorist activities.
• The use of funds by a non-profit organization is not consistent with the purpose for which it was established.
• Client donates to a cause that is subject to derogatory information that is publicly available (e.g., crowdfunding initiative, charity, non-profit organization, non-government organization, etc.).

PF- Sanction Evasion Red Flags and Typologies

• Dealings, directly or through a client of your client, with sanctioned countries or territories where sanctioned persons are known to operate.
• The use of shell companies through which funds can be moved locally and internationally by misappropriating the commercial sector in the UAE.
• Dealings with sanctioned goods or under embargo. For example:
  • Oil or other commodities
  • Dual-Use items (wire nickel, inverters, etc.)
• Identifying documents that seemed to be forged or counterfeited.
• Identifying tampered or modified documents with no apparent explanation, especially those related to international trade.
• The activity developed or financed does not relate to the original or intended purpose of the company or entity. For example:
  • For companies, they are importing high-end technology devices, but they are registered as a company that commercializes nuts.
  • For a non-profit organization, they are exporting communication devices, but they are an entity aimed to provide health services.
• Very complex commercial or business deals that seem to be aiming to hide the final destiny of the transaction or the good.
• Complex legal entities or arrangements that seem to be aiming to hide the beneficial owner.

Sanction Evasion Reporting

Pursuant to Article (9) of Federal Law No. (20) of 2018 on Anti-Money Laundering and Combating the Financing of Terrorism and Financing of Illegal Organisations. Sanction Evasion Reports should be submitted to the UAE FIU as Suspicious Transaction Reports (STR).

FIs, DNFBPs, and VASPs should be able to differentiate between the cases that require submitting a FFR/PNMR or submitting an STR/SAR.

Any suspicious transactions or activities that do not include confirmed or potential matches to the UAE Local Terrorist List or UN Consolidated List should be reported to the FIU by raising a STR/SAR through the goAML platform. Alternatively, cases that involve a confirmed or potential matches to the UAE Local Terrorist List or UN Consolidated List should be reported to the Executive Office by raising a FFR/PNMR.

The Table below summaries the difference between FFR/PNMR and STR/SAR.

PROCESS FOR TRANSACTIONS INVOLVING DUAL-USE GOODS

Dual-Use goods is defined as goods that may have both civilian and military uses. These items are generally controlled by governments via export controls, which prevent the export of certain items depending on the end user and end use of the item absent governmental permission. 

Cabinet Resolution No. (50) of 2020 contains the list of strategic and Dual-Use goods controlled under UAE law (UAE Control List). The UAE Control List implements internationally agreed Dual-Use goods subject to import and export control, including the Missile Technology Control Regime (MTCR), Nuclear Suppliers Group (NSG), the Wassenaar Arrangement (WA), the Australia Group (AG), the Chemical Weapons Convention (CWC), and the Organization for the Prohibition of Chemical Weapons (OPCW). The UAE Control List is composed of 12 categories based on the technology used. Each category includes a technical description of the items and their control parameters. A summary of the categories can be seen in the table below :

FIs, DNFBPs, and VASPs should be aware that Dual-Use goods are frequently controlled for export and should attempt to identify Dual-Use goods in transactions and provide enhanced scrutiny to such transactions. FIs should screen the UAE Control List (Cabinet Resolution No. 50 of 2020) in trade-based transactions that may involve Dual-Use goods. The import or export of Dual-Use goods require a permit from the relevant authorities. 

Trade documentation such as bills of lading or letters of credit often do not include the level of detail needed to ascertain whether goods are controlled for export. Nevertheless, private sector entities may be able to detect certain export-related red flags present in transactions. If there is a reasonable suspicion that the goods involved in the transaction could be used in the development, production, or use of products related to WMD, the customer should be required to provide more information about the product, including technical specifications, as well as the end use and end user of the product.

The diagram below provides a process map for dealing with transactions involving Dual-Use goods:

For more details and an example on how to use the list, please refer to the CPF Guideline.

UAE Government Authorities Role

Supervisory Authorities

• Provide any information regarding the outcome of the freezing measures within 3 business days to the Executive Office of the Committee for Goods and Materials Subject to Import and Export Control (Executive Office). The information must arrive to the EO maximum within 5 days from when the freezing action was taken or from when the attempted transaction took place.
• Supervise reporting legal entities to verify their compliance with these obligations and measures.
• Apply enforcement actions including administrative fines in case of non-compliance.

Law Enforcement

• Provide any information regarding the outcome of the freezing or implementation of other sanctions, such as travel ban, embargoes, commercial measures, and others within five business days to the Executive Office.

Executive Office of the Committee for Goods and Materials Subject to Import and Export Control (Executive Office).

• Act as a central authority to ensure implementation of Targeted Financial Sanctions in the UAE
• Receive and process grievances against listing in UN and Local Lists decisions
• Receive and process applications to use frozen funds as per Sanctions Lists
• Work closely with the Supreme Council with regards to the local listing.
• Circulate updates to the local and UN lists to the government and private sector
• Coordination and exchange of information between Government Agencies.

Grievances and Requests

Request a Freezing Cancellation

Assets frozen due to the Local List

Any individual or legal entity with a name identical or similar to a listed name, and any person who has been adversely affected by a sanctions listing can submit a written application to the Executive Office for de-freezing or cancellation of any other measures taken against him. Such application must be accompanied with all supporting documents.

To make an application to lift the freezing, fill this form and attach all supporting documents to substantiate your claim. Send the request to: iec@uaeiec.gov.ae

The Executive Office shall refer the application to the Supreme Concil for its consideration. The Supreme Council shall issue its decision, within thirty days from the date of receipt of application. The Executive Office will notify the applicant of the result in writing.

In case the application was rejected by the Office or remained without response thereto within thirty days from date of its submission, the applicant may file a grievance at the Competent Court within sixty days from the date on which he was notified of rejection of the application, or after lapse of the response period. A challenge to the freezing and Other Measures decision will not be accepted before a request against it was filed and rejected, or the period for responding to it had lapsed, as stated above.

Assets Frozen due to the UN Sanctions Lists

Any individual or legal entity with a name identical or similar to a name in the list, and any person who has been adversely affected by a sanctions listing can submit a written application to the Executive Office for de-freezing or cancellation of any other measures taken against him. Such application must be accompanied with all supporting documents. Send the form request to: iec@uaeiec.gov.ae

The Office will examine the application, and for the purposes of deciding, it may ask for any clarifications or additional documents to the applicant, the UN Security Council, the relevant Sanctions Committee, or any other party.

The Office shall issue its decision to reject or approve the request to lift the freezing measures within thirty days from date of receipt of the application and shall notify the applicant accordingly.

In case the application was rejected by the Office or remained without response thereto within thirty days from date of its submission, the applicant may file a grievance at the Competent Court within sixty days from the date on which he was notified of rejection of the application, or after lapse of the response period. A challenge to the freezing and Other Measures decision will not be accepted before a request against it was filed and rejected, or the period for responding to it had lapsed, as stated above.

Permission to Use Frozen Funds

Assets frozen due to the Local Terrorist List

An individual or legal entity listed in the Local Lists, or his legal representative, and any stakeholder may submit, to the Executive Office, a written request for accessing all or part of the frozen funds. Such request will be referred to the Ministry of Justice. Send the request form to iec@uaeiec.gov.ae

Following coordination with the Supreme Council, The Ministry of Justice may approve use of part of the frozen funds of an individual or legal entity listed in Local Lists, for any of the following purposes:

1. To cover necessary or basic expenses, such as the amounts payable for foodstuffs, rent, mortgage, medicine, medical treatment, insurance premium, educational and judicial fees, and public utilities fees.
2. To pay professional fees and costs relating to rendered legal services and other exceptional expenses within reasonable limits; or services relating to safekeeping or management of frozen Funds.
3. Extraordinary expenses if and as approved, on a case-by-case basis, by the Ministry of Justice..

The Executive Office will notify the applicant, in writing, with the outcome decision related to the approval or rejection of the request.

In case the application was rejected or remained without response thereto for thirty days from date of its submission, the applicant may file a grievance at the Competent Court within thirty days from the date on which he was notified of rejection of the request, or after lapse of the response period.

A challenge to the rejection of the request decision shall not be accepted before a grievance against it was filed and rejected, or the period for responding to it had lapsed, as stated in this article.

Assets Frozen due to the UN Sanctions Lists

affected by a freezing measure may submit a written request to the Executive Office, by the affected individual or his legal representative, accompanied with all supporting documents. Send the request form to iec@uaeiec.gov.ae

To cover basic expenses:

The Executive Office may approve the request for access to funds frozen as per the Sanctions List, in the following cases:

1. To cover necessary or basic expenses, such as the amounts payable for foodstuffs, rent, mortgage, medicine, medical treatment, taxes, insurance premiums, educational and judicial fees, and public utilities fees.
2. To pay professional fees and costs relating to rendered legal services and other exceptional expenses within reasonable limits; or services relating to safekeeping or management of frozen Funds.

In the event that the submitted request related to the basic expenses, the Executive Office must notify the UNSC or the Sanctions Committee of its intention to approve the submitted application. In case the Sanctions Committee does not object or issue a decision of rejection within five business days, the Office may order that the approved amounts of funds are unfrozen and the individual holding the frozen funds shall be immediately notified in writing to such effect and asked to implement the decision and advise the Office of the actions taken in this regard.

To cover extraordinary expenses:

Any individual, group or legal entity affected by a freezing measure may submit a written request to the Executive Office, by the affected individual or his legal representative, accompanied with all supporting documents to cover extraordinary expenses other than those mentioned under the basic expenses section above. Send the request form to iec@uaeiec.gov.ae

The Executive Office shall forward the request to the relevant UN Sanctions Committee to access to funds frozen as per the Sanctions List, in the following cases:

The Executive Office will notify the relevant UN Sanctions Committee of the request to approve the submitted application and may only approve such request upon obtaining form the Sanctions Committee’s a written approval. In the absence of a written approval, the Office will not grant the request.

• The Executive Office will notify the applicant for use of funds frozen as per the Sanctions List, or his legal representative, in writing, of its approval of the application or rejection thereof and the reasons for the rejection, without delay.

The Executive Office may revoke the decision to use of funds frozen under the Sanctions List, at any time and when having reasonable grounds for a suspicion that the funds are used for financing terrorism or financing proliferation of weapons of mass destruction.

Grievances to the court

In case any of the application for use of funds frozen under the Sanctions List was rejected or remained without response thereto for thirty days from date of its submission, the applicant may file a grievance at the Competent Court within sixty days from the date on which he was notified of rejection of the application, or after lapse of the response period.

The court’s decision on the grievance shall be incontestable, and if the court ruled to reject the grievance, a new grievance may only be filed after six months from the date of rejection of the grievance, unless a serious reason acceptable to the chairman of the court arises before expiry of such period.

A challenge to the decision to reject the application shall not be accepted before a grievance against it was filed and rejected, or the period for responding to it had lapsed.

De-Listing from UN Designation

Any individual, group or legal entity designated by the United Nations Sanctions Committee may submit a request for removal from the relevant list to the applicable United Nations Sanctions Committee, through the Executive Office, following the procedures for submitting de-listing requests of that UN Sanctions Committee.

The Office may ask any questions or ask for more clarifications from the listed individual or legal entity submitting the application and shall respond to any other queries raised by the Ombudsperson or Focal Point.

De-listing procedures:

• 1718 Sanctions Committee - Democratic People’s Republic of Korea
• 1988 Sanctions Committee - The Taliban, and associates

De-listing procedures related to ISIL (Da'esh) & Al-Qaida Sanctions:

• UNSCR 1267 (1999), 1989 (2011) de-listing procedure
• Ombudsperson to the ISIL (Da'esh) and Al-Qaida Sanctions Committee
• Focal Point for De-listing

De-listing from Local Terrorist List

Any individual or legal entity listed in Local Lists may submit, in person or through a legal representative, a grievance application to the Executive Office attaching thereto all documents supporting the grievance. Send the request to: iec@uaeiec.gov.ae

The following form can be filled to request and submit your delisting request

The Office shall refer the grievance to the Supreme Council, and both may request clarifications and further documentation from the applicant, or from the Law Enforcement Authorities or other relevant agencies in the State.

If the Supreme Council determines that there are no longer reasonable grounds for continuing the listing, the Supreme Council shall propose to the Cabinet that the individual or legal entity in question is de-listed. In case of approval by the Cabinet, the name of the listed individual shall be removed from the Local List and the freezing and other measures taken in accordance with the aggrieved listing decision shall be automatically lifted. The Supreme Council shall send the de-listing decision immediately to the Office for publication.

The Office shall be notified by the Supreme Council in case the application was rejected and shall also be notified of the Cabinet’s decision on the grievance so that the Office may notify the applicant.

In case the grievance was rejected or remained un-responded to for thirty days from date of its submission, the grievant may challenge the Cabinet’s listing decision before the Competent Court within sixty days from the date he was notified of the rejection or lapse of the response period.

The court’s decision regarding the grievance shall be incontestable. If a grievance was rejected, a new grievance may only be submitted after the lapse of six months from date of rejection of the previous grievance, unless a serious reason acceptable to the chairman arises before expiry of such period.

A challenge to a Listing or re-Listing decision shall not be accepted before a grievance against it was filed and rejected, or the period for response to it had lapsed, as stated in this article.

Frequently Asked Questions

What does 'freezing' mean?

Freezing means the prevention of any transfer, conversion, disposition, or movement of any funds or other assets that are owned or controlled by listed individual or legal entities

What does 'funds' mean?

Funds mean assets of every kind, and in whatever form, whether tangible, intangible, electronic, digital, cryptic, movable or immovable, corporeal or incorporeal, however acquired, and any documents or instruments in any form, including national currency, foreign currencies, documents or deeds establishing ownership of such assets or any associated rights or interest in them, in whatever form, including electronic, and digital, forms, or any interests, profits or income derived or earned from such assets, as well as economic resources considered as assets of any kind, and that may be used to obtain any funds, goods or services including internet posting services or related services.

Why are individuals or legal entities listed in the sanction lists?

These Sanction Lists include names of individuals, legal entities and groups that the UAE or the UN believe are detrimental to national or/and global peace and security. These individuals or legal entities or groups are mostly involved in acts of terror and violation of International Law.

Who must comply with Targeted Financial Sanctions (TFS) regimes?

Sanctions restrictions, including TFS measures, must be implemented by any Person (both natural or legal entities) located in the UAE, including governmental authorities. UAE Persons (both natural and legal entities) must also comply with the sanctions restrictions when they are located or engaged in activities abroad.

What are the consequences in case of a failure to comply with the obligations set out in Cabinet Resolution No. 74 of 2020, other applicable legislation and this guidance note?

Any Person, found to violate and/or be in non-compliance with the obligation in the Cabinet Resolution No.74 of 2020 or failing to implement procedures to ensure compliance may face imprisonment or a fine of no less than AED 50,000 (fifty thousand dirham) and no more than AED 5,000,000 (five million dirham).

What actions must an individual or legal entity take if designated Funds are detected?

1. In case a financial institution or DNFBP determines that any of the funds it holds or administers are targeted funds as indicated above, it shall take the following steps:
   • Immediately freeze all funds and any funds derived or generated from such funds without providing any notice to the customer or potential customer.
   • Refrain from providing any financial or other services or from providing funds to or for the benefit of a listed individual, group, or legal entity.
   • Immediately inform the Executive Office and the relevant Supervisory Authority of the freezing measures taken.
   • Fully cooperate with the Supervisory Authority and the Executive Office in verifying the accuracy of the information provided.
   • Inform the Supervisory Authority within two days of the freezing measure, including information on the status of and any action taken with respect to assets, the nature of assets and amount of assets frozen, and any other information that is relevant to or would facilitate compliance with relevant UNSC resolutions.

What is the legal framework for the implementation of the United Nations and National Terrorist Sanctions Lists?

The UAE issued Federal Cabinet Resolution No. 74 of 2020, establishing the framework regarding the targeted financial sanctions, including the Local Terrorist List and the UN Consolidated List.

How can I find out who is a listed individual, group, or legal entity? 

For an individual, group, or legal entity's activity to become targeted and thus subject to a freezing obligation and/or other restrictive measures under the Cabinet Resolution No. 74 of 2020, that individual, group, or legal entity first has to be "designated" as falling within the scope of a relevant UNSC Resolution. Either the UNSC or the relevant United Nations Sanctions Committee makes such "designations".  

The updated Sanction Lists can be accessed through the following website: https://www.uaeiec.gov.ae/en-us/United-Nations-Security-Council-Sanctions.

For a better experience, it is advisable to subscribe to our mailing list to receive updates regarding the UN List and the Local Terrorist List.

What needs to be done if a current or former customer is listed?

If a current or former customer with whom the financial institution or DNFBP has or had dealings (i.e. business relationship or facilitating of an occasional transaction) became listed. A financial institution or DNFBP must freeze any assets and must not offer access to any additional funds or services and must immediately inform the Supervisory Authority or the Executive Office.

Can permission be obtained to access frozen assets by the listed individual or legal entity?

1. For the UN List, the Executive Office, in limited circumstances, may permit access to frozen funds based on a request by the listed individual or legal entity. Financial institutions and DNFBPs will, in such case, receive a written statement from the Executive Office stating the amount and conditions of access to the assets.
2. For the Local Terrorist List, the Ministry of Justice may permit access to frozen funds in some limited circumstances based on a request by the listed individual or legal entity. Financial institutions and DNFBPs will, in such case, receive a written statement from the Ministry of Justice stating the amount and conditions of access to the assets.

May I permit transfers to be made into frozen accounts, and if so, which ones are subject to what conditions?

1. The Cabinet Decision provides that financial institutions may credit frozen accounts with interest or other earnings on those accounts; or with payments due under contracts, agreements, or obligations that were concluded or arose before the date on which the individual or legal entity was listed, provided that any additions to such accounts shall also be frozen.
2. The Supervisory Authority and the Executive Office must be notified about such transactions.

Can I be held liable for freezing funds of a listed individual or legal entity based on the Cabinet Decision?

1. The Cabinet Decision clearly states that any individual or legal entity is exempted from criminal, administrative, or civil liability if a freezing measure is carried out in good faith and for the purpose of complying with the provisions of the Cabinet Decision. Thus, as long as the freezing measures were taken based on the belief that the relevant funds are targeted funds, the individual or legal entity, financial institution, or DNFBP is exempted from any liability resulting from such freezing measure even if it later turns out that the frozen funds are in fact not targeted by the Cabinet Decision.
2. At the same time, financial institutions and DNFBP or profession shall note that the criminal sanctions may apply to any Person who violates or fails to comply with the freezing obligation. Accordingly, both intentional and gravely negligent conduct resulting in the lack of application of a freezing measure may trigger administrative sanctions and/or criminal liability.

What if my customer's name does not match exactly or I am suspicious that the customer is listed or acting on behalf of a listed person?

In case of a partial match or suspected match with a listed individual or legal entity, a financial institution or DNFBP must freeze the assets and must immediately contact the relevant supervisory authority.

How can I determine whether I am in possession of targeted funds?

1. Financial institutions and DNFBPs are responsible for having in place effective processes, policies and procedures to implement the provisions of the Cabinet Decision No. 74 of 2020. This involves frequently checking the customer databases and any information obtained on potential or existing customers against UN designations and Local Terrorist List to determine whether a financial institution or DNFBP possesses or administers funds for listed individuals or legal entities. The obligation by financial institutions and DNFBPs to freeze funds of listed individual or legal entity applies immediately after a designation was published by a relevant UN Sanctions Committee or in the Local Terrorist List.
2. Failure by a financial institution or DNFBP to apply freezing measures, immediately or in any case within 24 hours after a designation has been made, or otherwise provide funds or services to or for the benefit of a listed individual or legal entity, constitutes a breach of UAE law and may result in the application of both pecuniary and incarceration sanctions set out in the Cabinet Decisions set out as per the list in this document.
4. Some financial institutions and designated businesses and professions rely on externally provided screening services (e.g., World Check) and other providers to verify that their clients are not subject to any UN sanctions. It is important to note in this regard that such online services are useful but should not be viewed as an absolute guarantee of compliance with the obligations under the Cabinet Decisions. Additional periodic checks against the designations made by the UN Sanctions Committees and the Local Terrorist List must be carried out.

How long do I have to keep funds frozen?

1. The Cabinet Decisions do not limit the timeframe for any given freezing measure. Accordingly, the obligation to keep funds frozen could apply indefinitely in some cases.
2. A decision by the competent UN Sanctions Committee or the UAE Cabinet to remove a name from the Sanctions Lists of listed individual or legal entities also terminates the obligation to freeze funds in relation to that individual or legal entity. A financial institution or DNFBP may only lift a specific measure if it can verify that the competent UNSC Sanctions Committee or the UAE Cabinet has indeed removed the relevant individual or legal entity from the list of designations.

What shall I do if my name is similar to a listed person?

In case freezing measures were taken in relation to funds of a person that has the same name as a listed individual or legal entity but who is in fact not the same person, such person can send a request to lift the freezing measures to the Executive Office.

Is my supervisory authority going to check compliance with the Cabinet Decision in the course of their onsite inspections?

The Cabinet Decision No. 74 of 2020 provides that financial institutions and DNFBPs are under an obligation to have in place adequate processes, policies and procedures, including resourcing thereof, to verify that they are complying with all aspects of the relevant Cabinet Decisions. Supervisory authorities will verify compliance by financial institutions and DNFBPs with this obligation during their supervisory activities. A failure to have in place such procedures may result in the application of criminal as well as supervisory sanctions as stipulated in the Cabinet Decisions.

Contact

Send an email to contact the Executive Office of the Committee for Goods and Materials Subject to Import and Export Control to iec@uaeiec.gov.ae.