On Friday 18 March 2022, Luxembourg's Minister of Finance, Yuriko Backes, convened an extraordinary meeting of the monitoring committee of financial restrictive measures to take stock of the national implementation of the European Union's (EU) sanctions against Russia following the military invasion of Ukraine.
Minister Backes stressed the importance of Luxembourg's active participation in the negotiations on the successive packages of restrictive measures adopted by the EU in response to Russian aggression in Ukraine. She reiterated the Grand Duchy's unconditional support for the measures taken in this regard.
If the adoption of sanctions against Russia and those who support the Russian government has made it possible to send a strong and unambiguous political message, only a robust and consistent implementation of restrictive measures will make it possible to produce the desired effects and thus put pressure on decision makers, according to the Finance Minister.
She also recalled that national legislation, in particular the law of 19 December 2020 on the implementation of restrictive measures in financial matters, allows ministries, supervisory authorities and self-regulatory bodies to ensure that the sanctions are complied with as well as to act in the event of non-compliance.
The meeting notably allowed participants to share their experiences and efforts made so far. They took stock of the tools and procedures in place to ensure the effective implementation of sanctions. In this context, the participants highlighted their good cooperation with the Ministry of Finance.
Luxembourg's authorities are working closely with their European counterparts and the other EU Member States to ensure the effective implementation of the sanctions and thus avoid possible attempts to circumvent them. In this context, Luxembourg's Ministry of Justice informed the monitoring committee about the work carried out within the new "Freeze and Seize" platform, created by the European Commission. The exchange within this European taskforce allows Member States to share information and practices on aspects related to sanction procedures. These discussions also clarified the legal modalities relating to criminal seizure and confiscation, measures which are not currently included in the range of sanctions taken against Russia.
The monitoring committee noted that the European Commission has also set up a whistleblowing tool intended to facilitate the reporting of possible breaches of sanctions. This is designed as a secure online platform that allows whistleblowers to anonymously report past, current or planned breaches of EU sanctions.
Moreover, the monitoring committee exchanged data on the implementation and checks carried out over the past three weeks. To date, the Ministry of Finance has received around 100 notifications from Luxembourg operators on the freezing of the assets and economic resources of designated persons or entities. No request for authorisation derogating from the financial restrictive measures has been issued. The CSSF confirmed that the obliged entities have frozen assets. The financial regulator also carried out a risk analysis and is preparing to launch on-site controls in the coming days. The insurance commission (Commissariat aux Assurances) indicated that maritime insurance contracts have been terminated by Luxembourg insurers.
No violation of the regulations on sanctions in force has been noted to date. It was recalled that the Luxembourg authorities are available to all operators to assist them with any questions they may have in this regard.
The interinstitutional committee in charge of monitoring restrictive measures in financial matters was created in 2010 by Grand-Ducal regulation to monitor the implementation of the various financial sanction regimes by the national authorities. Following the decision of the Government Council on 11 February 2022, the Minister of Finance tabled a bill to further clarify the coordination role of this committee.
Finally, the monitoring committee will continue to meet on a regular basis and will continue the exercise of coordination and exchange of information.
Attendees at this meeting included representatives of the following bodies: Luxembourg's Ministry of State, the Ministry of Foreign and European Affairs, the Ministry of the Economy, the Ministry of Justice, the Public Prosecutor's Office and the District Prosecutor's Office of Luxembourg, the State Intelligence Service, the Registration Duties, Estates and VAT Authority, the CSSF, the insurance commission, the control office for exports, imports and transit, the Luxembourg Institute of Registered Auditors, the Order of Lawyers in Luxembourg, the Order of Chartered Accountants, the Chamber of Notaries, the chamber of the judicial officers (Chambre des huissiers de justice), the Directorate of Civil Aviation, the Luxembourg Business Register, the Luxembourg Financial Intelligence Unit and the Luxembourg Maritime Administration.
