I. Introduction

On 27 February 2012, the EU adopted further sanctions against Syria in Council Decision 2012/122/CFSP1 and Council Regulation 168/20122. The new sanctions as from 28 February 2012 impose an asset freeze on the Central Bank of Syria and seven Syrian Ministers; prohibit the sale/supply/export/transport of gold, precious metals and diamonds to the Syrian Government (and related bodies) or to the Central Bank of Syria as well as the purchase/import/transport of these goods from them (as well as providing related technical assistance, brokering, financing or financial assistance); and prevent access to EU airports of all cargo-only flights operated by Syrian airlines.

This is the second expansion of the EU Syrian sanctions since the new regime (laid down in Council Decision 2012/37/CFSP and Council Regulation 36/2012) replaced the 2011 regime earlier this year. For more information on the new regime, see our previous alerts of 20 January 2012 and 25 January 2012.  

II. Asset Freeze expanded to include 8 further parties including the Syrian Central Bank

The Central Bank of Syria and seven Ministers in the Syrian Government have been added to Annex II of Regulation 36/2012, which lists parties subject to the EU’s asset freeze. Parties under EU jurisdiction cannot make any funds or economic resources (broadly interpreted to include any goods as well) available, directly or indirectly, to or for the benefit of these listed parties (subject to limited exceptions, to be authorised by the competent EU Member State). Assets belonging to or controlled by listed parties and held by parties falling under EU jurisdiction are frozen (again, with limited exceptions).

However, with respect to the Central Bank of Syria, an exemption is made for transfers by or through the Central Bank of Syria of funds or economic resources received and frozen after 27 February 2012 (the date of its designation) if these payments do not benefit listed parties (Annex II and IIa of Regulation 36/2012), and subject to prior Member State authorisation.

A further exemption applies for transfers of funds or economic resources to or through the Central Bank of Syria to parties not listed in Annexes II or IIa, where such a transfer is related to a specific trade contract, and subject to prior Member State authorisation.

A third exemption concerns transfers by or through the Central Bank of Syria of frozen funds or economic resources and allows such transfers to financial institutions under EU jurisdiction in order to provide these with liquidity for the financing of trade. This exemption is also subject to prior authorisation by the competent EU Member State.

With the most recent amendments, Annex II of Regulation 36/2012 contains 92 natural persons and 38 entities which are subject to the EU’s asset freeze. Annex IIa of Regulation 36/2012, which also lists parties subject to the asset freeze clause, remains unamended by the latest sanctions and has one entry only, namely the Commercial Bank of Syria.

III. Supply/purchase ban for gold, precious metals and diamonds

From 28 February 2012, it is forbidden to sell, supply, transfer or export gold, precious metals and diamonds as listed in a new Annex VIII3 to Regulation 36/2012 to the Government of Syria (and public bodies, corporations and agencies) or the Central Bank of Syria, or to any party acting on their behalf or owned or controlled by them. This prohibition applies to both direct and indirect supplies and regardless of whether the products originate in the EU.

It is now also forbidden to purchase, import or transport Annex VIII products from the above parties, directly or indirectly, and regardless of where the products originate.  

The provision of technical assistance, brokering services, financing or financial assistance related to Annex VIII goods to these parties (directly, or indirectly) is also prohibited.

III. Ban on Syrian Cargo Flights

Council Decision 2012/122/CFSP obliges the Member States to take measures to prevent access to airports falling under their jurisdiction for all cargo-only flights operated by Syrian carriers. Mixed passenger/cargo flights are still allowed.