Modernisation of sanctions legislation: overview of the proposed amendments

1. Central reporting point for sanctions compliance

The legislative proposal introduces a central supervisory authority: the Central Reporting Point for Sanctions Compliance (In Dutch: Centraal Meldpunt Sanctienaleving, CMS). This body will be given a coordinating role in the implementation and enforcement of sanctions rules, with particular attention to sanctioned persons and entities. The CMS will become a key hub in the exchange of information between supervisory and enforcement authorities, such as the Dutch Customs.

According to the explanatory memorandum, the Central Import and Export Service (in Dutch: Centrale dienst in- en uitvoer, CDIU) will continue to perform an important separate role. The CDIU will remain responsible for issuing import and export licences. In view of its specialist expertise, the minister prefers to keep notifications relating to import and export with the CDIU. The establishment of the CMS is not expected to significantly alter the CDIU’s range of tasks.

2. Administration and assumption of management

Under the new legislation, the minister may, in exceptional cases, appoint an administrator to companies. This serves to enforce compliance with sanctions obligations. In addition, the minister may assume the management of frozen registered property or entrust it to an expert third party. In serious cases, even the management board of a company may be replaced where there is – or there is a real risk of – a serious infringement of sanctions rules. The Council of State is critical of this power and questions whether more proportionate powers should not (first) be granted

3. Expansion of enforcement instruments

administrative enforcement order, a penalty payment order, binding instructions and administrative fines. This will give supervisory authorities, including the Dutch Customs, the ability to take more directive action.

For the time being, enforcement mainly takes place within the sphere of criminal law. The explanatory memorandum indicates that the use of criminal law is not always appropriate. The minister therefore seeks to introduce a dual enforcement system. In the future, more directive action may be taken and the more severe deployment of criminal law will no longer be the only option.

The Dutch Customs will remain one of the supervisory authorities and will, in all likelihood, be granted broader possibilities for administrative intervention in the event of infringements of sanctions measures

4. Publication of sanctions and registrations

The legislative proposal makes it possible to publish measures imposed on companies. In addition, annotations of relationships with sanctioned parties will be recorded in public registers, such as the Trade Register and the Land Registry.

5. Conclusion

With this legislative proposal, the legislature establishes more robust measures for the enforcement of sanctions. The Dutch Customs will be granted additional enforcement powers. If you have any questions about the legislative proposal, or about sanctions legislation and export control in general, feel free to contact our advisors.

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