Sanctions, negative effective measures, which has been set to Russia are to be updated, expanded as well as practices are to become more precise. The most recent sanctions are implementing Regulation (EU) 2022/427 as well as Regulation (EU) 2022/428.
Credit institutions operating in Finland must provide to the Ministry for Foreign Affairs of Finland information on deposits exceeding of EUR 100,000 from Russian and Belarusian nationals. For reporting, the European Banking Authority (EBA) has developed guidelines and document form. The report must be submitted to the Ministry for Foreign Affairs of Finland by 27 May 2022 (dead line). Obligation to submit the report is based on the Regulation (EU) No 833/2014 Art. 5 g subparagraph 1a. It is possible to deviate from the set deadline with the exception provided by the competent local authority.
The background to the notification obligation is Regulation (EU) No 833/2014 Art. 5b which enacts the following prohibition:
“It shall be prohibited to accept any deposits from Russian nationals or natural persons residing in Russia, or legal persons, entities or bodies established in Russia, if the total value of deposits of the natural or legal person, entity or body per credit institution exceeds 100 000 EUR.”
A restriction on the application of the above prohibition is that:
“Paragraph 1 shall not apply to nationals of a Member State, of a country member of the European Economic Area or of Switzerland, or to natural persons having a temporary or permanent residence permit in a Member State, in a country member of the European Economic Area or in Switzerland.”
It is to be noticed, that by way of derogation from the local competent authority, it may authorise the acceptance of such a deposit, under such conditions as they deem appropriate, after having determined that the acceptance of such a deposit is necessary and satisfies the requirements enacted in the Regulation.
Also note that the competent authority may, subject to such conditions as it deems appropriate, authorize the receipt of the deposit. However, prior to authorisation the authority has to determinate that the need enacted in the Regulation are satisfied. It is for the national competent authority to decide on what evidence is required to obtain supporting the exemption under Art. 5 c.
In practice, we understand that credit institutions have categorically limited deposits from Russian citizens. The limitation being on the amount of EUR 100 000. In practice, this has also led to difficulties for those persons and legal persons to whom a ban on the restriction should not apply. These are, for example, persons who have nationality or a permanent residence permit in an EU country. In case such party is in need to receive deposits in excess of the current limit, we recommend applying for an exemption.
The above restriction has been imposed by credit institutions despite the fact that the EU Commission’s Q&A dated 17.5.2022 states in paragraph 12 that:
“This means that the accounts of Russian nationals who also have the nationality of one the above countries can be credited above EUR 100 000.“
Read more about sanctions from our article sanctions a legal labyrinth to business lawyers.
The European Banking Authority (EBA) is made up of three supervisory authorities: i) the European Securities and Markets Authorities (ESMA); ii) the European Banking Authority (EBA) and iii) the European Insurance and Occupational Pensions Authority (EIOPA). The system also comprises the European Systemic Risk Board (ESRB) as well as the Joint Committee of the European Supervisory Authorities and the national supervisory authorities.
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** This article is for informational purposes only and is not intended as legal advice.