EU acts against Russian-owned companies

The European Commission released guidelines on the implementation of the new article 5r of Council Regulation 833/2014 of the 12th package of restrictive measures, to legal persons, entities and bodies established in the EU whose proprietary rights are directly or indirectly owned for more than 40% by a legal person, entity or body established in Russia, a Russian national, or a natural person residing in Russia, according to a statement from the Ministry of Finance on Tuesday.

Specifically, in the new article (5r) it is stated that the said legal persons, entities and bodies based in the Union should report, from May 1, 2024, to the competent authority of the member state in which they are established, within two weeks from the end of each quarter, any transfer of funds of more than EUR 100 000 from the Union which they carried out during that quarter, directly or indirectly, in the context of one or more transactions.

It also states that, credit and financial institutions must from July 1, 2024, start submitting to the competent authority of the member state in which they are located, within two weeks from the end of each semester, information on all transfers of sums of money to countries outside the Union with a cumulative value, during that semester, of more than EUR 100,000 which they have carried out, directly or indirectly, for the legal persons, entities and bodies mentioned above.

It notes that the Commission specified that the obligation to report for credit and financial institutions initiating the funds transfers subject to paragraph 2 of Article 5r kicks in on July 1, hence the day after the end of the first semester. Therefore, the first report should be submitted by July 15, 2024, it adds.

In its announcement, the Ministry of Finance states that “any information provided or received will be used only for the purposes for which it was provided or received”.

Also, the Ministry assures that it will handle all the information it receives in accordance with the legislation on Personal Data Protection.