News item | 13-05-2022 | 16:31
How has the Netherlands implemented and enforced the sanctions against Russia? And what could be better? On 13 May 2022, Stef Blok (National Coordinator Sanctions Compliance and Enforcement) presented his final report to Minister Hoekstra of Foreign Affairs. This report contains the findings of recent weeks and recommendations.
The final report: main conclusions
Improvements are needed to comply with the sanctions and to monitor them. But there is no indication that anything was missed in the freezing of assets of persons and entities on the sanctions list. We summarize the results.
Improvements in sanctions compliance and enforcement
Never before have such major sanctions been imposed as now. The sanctions affect almost all sectors of the economy. That is why a large number of ministries, companies and executive services are involved in the enforcement of the sanctions and their supervision. A lot goes well with that. But especially now that it is clear that the war in Ukraine and therefore the sanctions against Russia will last for a longer period of time, improvements are also needed.
Recommendations for this are made in the report. For example:
- Provide permanent responsibility for coordination of sanctions compliance with the Ministry of Foreign Affairs;
- Record the supervision of compliance with the sanction rules for civil-law notaries, lawyers and accountants. And strengthen the reporting obligation in relation to the duty of confidentiality for these professional groups;
- Make agreements within the European Union (EU) to improve the process of disclosing sanctions. For example, about how and when names are submitted for the sanction list;
- Provide a stronger legal basis for exchanging data. Preferably by amending the sanctions regulation (the EU sanctions rules). And otherwise through national laws and regulations.
Results Dutch implementation of sanctions
As of May 13, 2022, this was the state of play for sanctions compliance:
| Category | Result compliance |
|---|---|
| Financial assets | €640.8 million frozen |
| Transactions | €425.2 million held back |
| Vessels | 24 vessels in view at Customs |
| Airplanes | 1 on the ground, 5 ‘wrapped up’ |
| freight | 34,169 containers stopped and assessed |
| Property | No signs of non-compliance with the freezing obligation |
Sanctions: has something been missed?
Since his appointment as sanctions coordinator in the Netherlands and Brussels, Stef Blok has spoken with regulators, market parties and professional groups. He has also put a data team to work to determine whether there are missing things in the compliance with the sanctions. This team kept information from different registers side by side. For example from the Investment Assessment Bureau, the Land Registry, the Chamber of Commerce and the Tax Authorities. Based on the information as of now, there are no indications that anything has been missed.
Frozen resources
The size of the frozen funds has to do with what the Dutch economy looks like. Stef Blok: “Thousands of containers have been stopped in the port of Rotterdam because the Netherlands has a world port. Luxurious yachts are more likely to be on the French Riviera than on the IJsselmeer. But they are built here. In addition, the Dutch real estate market is hardly interesting for Russian persons on the sanction list.”
Russian holdings in the Netherlands
Many parent companies (holdings) are established in the Netherlands. Also Russian. These may be Dutch companies, but the assets (assets) that are sometimes worth billions – such as supermarkets or cell towers – are largely or completely located outside the EU. As a result, those assets cannot be frozen in the Netherlands.
Russian properties
It is often difficult to find out who owns a business. Sometimes it’s because owning them is purposefully made complex. Also, properties are only frozen when more than 50% ownership. In Brussels, the Netherlands is making a case for lowering this threshold to 25%. This makes it more difficult to evade sanctions and at the same time retain control of a company. There is not yet a majority in the EU for this proposal.
Dutch rules and laws for sanctions
It looks like the sanctions will be in place for a longer period of time. New sanctions can also be added at any time. That is why it is important to review the Dutch laws and regulations on sanctions. For example, to exchange data more easily and to be able to monitor the implementation better.
In order to maintain an overview, Blok advises that the Ministry of Foreign Affairs should continue to play a strong and permanent coordinating role. It also remains important that ministries, companies and implementing organizations work closely together and take responsibility.
For more information about the sanctions, see the Sanctions Against Russia and Belarus (Belarus) page.