International sanctions are restricting measures of non-military effect which are aimed at preventing illegal activity (terrorism, drug trade) or policy and ensuring international peace, security and respect towards human rights.
To implement international sanctions and to pay regard to its customers’ interests and to protect their funds, Swedbank, AB as a bank of the Swedbank Group follows the sanctions announced by the European Union (EU) and the US Office of Foreign Assets Control (OFAC) and other sanctions. Sanctions to specified entities apply to the extent established by organisations which impose sanctions.
Sanctions executed by the bank are twofold: they can be used as a way to prohibit any relations (commercial, financial) with an entity subject to sanctions or they can be used to restrict certain transactions (e.g., export of certain goods), sanctions can also be imposed solely on certain regions, etc.
5.1. Use of sanctions aimed at prohibiting any business relationships with entities subject to sanctions
The bank does not establish and does not maintain business relationships with entities (natural or legal persons) and does not perform money transfers in the following cases:
Where entities are subject to the EU financial sanctions (freezing of funds or economic resources, prohibition of financial transactions)
You can find more information about persons that are subject to the EU financial sanctions here.
When entities are included in the list of Specially Designated Nationals (SDN)* administered by the US OFAC or entities are not included in this list but are related to SDN by any other relations, i.e. that are owned by the proprietary right or that are controlled by persons included in the OFAC SDN sanction lists.
You can find the US OFAC SDN list here.
* List of Specially Designated Nationals (SDN) is a list of citizens of special categories that is announced by the OFAC. Funds of entities that are included in this list are frozen and any transactions with such entities are prohibited.
5.2. Use of territorial and sectoral sanctions
When using territorial (e.g. activity of certain regions / territories is sanctioned) and sectoral sanctions (e.g. certain areas of economic activity are sanctioned (import / export of certain goods and services, prohibition to trade in financial instruments issued by certain entities), the bank can suspend a client’s payment order so as to find out, whether a certain payment order is not related to regions, groups of goods, etc. subject to sanctions. In such cases the execution of payment order can take longer because the bank might ask the client for more details about the circumstances of the payment order and perform certain internal check actions.
Attention should be drawn to the fact that the aforementioned sanctions are also implemented by correspondent banks, for this reason, the execution of payment orders might take longer also because of restrictive measures applied by correspondent banks.
To ensure smoother execution of international payment orders, the bank recommends that clients provide explicit purpose of settlement in English in the field of payment order details (for what goods and/or services the payment is made without limiting information to the indication of an agreement only).
Taking into consideration the requirements of the correspondent banks, the bank advices its clients to provide full address of the beneficiary in payment orders to Russia and Ukraine, and full payer’s address ¬ in payment orders from Russia and Ukraine. Full address in the aforementioned cases means the name of the street, city and country. If full address is not provided as required or the bank has grounds to believe that incorrect address was provided or address was deliberately
changed, the bank can refuse to continue payment order. This decision is made with the purpose to protect the interests of the bank’s customers with regard to international sanctions used.
5.3. Useful references
Implementation of international sanctions in Lithuania is coordinated by the Ministry of Foreign Affairs of the Republic of Lithuania. For more details click here.