Public discussion started on 20 February 2017 of a draft federal law on amendments to Federal Law No. 115-FZ on Combating Money Laundering and the Financing of Terrorism of 7 August 2001 (the "Draft Law"). The Draft Law was prepared by Rosfinmonitoring and has been published on the federal portal for draft legal regulatory acts.
The Draft Law was developed pursuant to UN Security Council resolution 1540 (2004), which requires all states to adopt laws banning the provision of assistance and financing to any non-state actors attempting to develop, acquire, manufacture, possess, transport or use nuclear, chemical or biological weapons and their delivery systems, especially for the purposes of terrorism.
The Draft Law introduces, inter alia, a new article 75 "Measures for combating the financing of proliferation of weapons of mass destruction." This article provides for the creation of a new "list of organizations and individuals with respect to which there is information that they are involved in the proliferation of weapons of mass destruction" (the "List"). The procedure for compiling the List will be determined by the RF Government. The List will be published on Rosfinmonitoring's official website.
Thus, all transactions involving funds or other assets will be subject to mandatory control by the organizations conducting such transactions (in particular, by jewelry companies), if any party to the transaction is an individual or entity included in the List, or is owned or controlled by or acts on behalf or at the direction of such an individual or entity.
The Draft Law sets forth a number of measures for combating the financing of proliferation of weapons of mass destruction. For example, jewelry companies will be required to:
- review at least once every three months whether any of their clients are included in the List and inform Rosfinmonitoring of the results of such review according to the procedure established by the RF Government;
- take steps to freeze (block) funds or other assets of an individual or entity immediately, but in any case no later than one business day from the date when information about the inclusion of that individual or entity in the List is published on Rosfinmonitoring's website, and also immediately inform Rosfinmonitoring of the steps taken;
- suspend a transaction involving funds or other assets for five business days from the date when the client’s order to carry out the transaction should be performed, if any party to the transaction is directly or indirectly owned or controlled by an individual or entity included in the List, or acts on behalf or at the direction of that individual or entity, and also immediately inform Rosfinmonitoring of the suspended transaction. At the end of that period the transaction can proceed, unless within that time Rosfinmonitoring issues a decision to extend the transaction’s suspension (which may be for up to 30 days).
The Draft Law enters into force on 1 September 2017.