Sanctions Watch | Weekly Vol. 89

Sanctions Watch Vol 88

In the latest edition of our Sanctions Watch weekly digest, we present significant updates on sanction watchlists and regulatory developments.

1. OFAC Unveils Groundbreaking File Finder Tool to Revolutionize Sanctions Compliance

OFAC launched the File Finder application on its website, enabling users to efficiently search and navigate all static content, including PDFs and Word documents. It allows searches by document title, type, and content, covering general licenses, federal register notices, executive orders, press charts, and advisories, providing enhanced access to legal and regulatory records.

2. UK Grants Landmark License to Enhance Oversight of Gazprom bank

On 21 February 2025, the UK’s Office of Financial Sanctions Implementation (OFSI) issued General Licence INT/2025/5855272 under regulation 64 of the Russia (Sanctions) (EU Exit) Regulations 2019. This licence permits international organisations with recognised diplomatic status in the UK to receive specific payments, known as “Permitted Payments,” from accounts held with Gazprom bank (Group ID: 15015). These payments include subscription fees and other necessary contributions from the Russian government to maintain membership in international organisations.

The General Licence allows “Relevant UK Institutions,” which include financial entities authorised under UK regulatory frameworks, to process such payments while ensuring compliance with UK sanctions laws. However, the licence does not permit direct or indirect payments to or for the benefit of any UN-designated persons (DPs).

The implementation of this licence aims to facilitate international organisations’ financial operations while upholding sanctions integrity. Reporting and record-keeping requirements apply to ensure transparency and regulatory compliance. The licence came into effect at 00:01 on 21 February 2025. OFSI emphasised that any transactions outside this scope would still require separate licensing under applicable UK autonomous sanctions regulations.

3. FATF Grey List February 2025 Update: Philippines Exits, Laos and Nepal Added

The Financial Action Task Force (FATF) concluded its February Plenary Meeting, announcing significant updates to its Grey List. The Philippines was officially removed from the list after demonstrating substantial improvements in its Anti-Money Laundering (AML), Combating the Financing of Terrorism (CFT), and Counter Proliferation Financing (CPF) frameworks. The country effectively implemented FATF’s recommendations, strengthening its regulatory oversight, enforcement mechanisms, and compliance measures to combat financial crimes.

Conversely, Laos and Nepal have been added to the Grey List due to strategic deficiencies in their AML/CFT/CPF frameworks. FATF determined that both countries need enhanced monitoring and must implement corrective actions to address gaps in financial crime prevention, risk assessment, and regulatory enforcement. By being placed on this list, Laos and Nepal will work closely with FATF to improve financial compliance, enhance law enforcement capabilities, and align with global AML/CFT standards.

The FATF Grey List serves as a warning to global investors and financial institutions regarding potential risks in listed countries. While Philippines’ exit marks a positive milestone, Laos and Nepal will need to undertake comprehensive reforms to meet FATF’s international standards and restore confidence in their financial systems.

4. EU Approves New Sanctions on Russia Ahead of Ukraine Invasion

The European Union has approved its 16th package of sanctions against Russia, aimed at increasing pressure on Moscow as the war in Ukraine enters its third year. These new measures target Russia’s so-called “shadow fleet,” a network of vessels used to bypass Western restrictions on oil and gas exports and transport stolen Ukrainian grain. Around 70 additional vessels will be sanctioned, adding to the more than 50 already listed. Additionally, almost 50 Russian officials, including government representatives and lawmakers, will be placed under sanctions, along with numerous entities, bringing the total to over 2,300 individuals and organizations.

The package also includes restrictions on 13 Russian banks and three financial institutions, further limiting Russia’s access to global financial markets. The EU will impose trade bans on certain chemicals and aluminum while placing restrictions on 11 Russian ports and airports that are allegedly being used to circumvent existing sanctions. European Commission President Ursula von der Leyen emphasized that these measures aim to curb Russia’s ability to finance its war efforts by tightening enforcement on sanction evasion. The sanctions are expected to be formally adopted by EU foreign ministers and come into force next week on the third anniversary of Russia’s full-scale invasion of Ukraine.

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Sanctions Watch is a weekly recap of events and news related to sanctions around the world.