Regarding export verification procedures for regulated goods

Šiaulių bankas (hereafter ‘the Bank’), has taken into account the clarification issued by the European Commission on the implementation of the enforcement of the export of sanctioned goods to third countries. Therefore, the Bank hereby advises that European Union (hereafter EU) operators should have in place appropriate due diligence procedures to ensure that exports of regulated goods are not diverted to Russia.

As a control measure, it is recommended that our customers incorporate additional conditions related to sanctions into purchase and sale contracts with business partners residing in third countries. It is advisable to insert such clauses into contracts, taking into account the risk of sanctions associated with specific clients, while also considering geographical, operational or other factors influencing an increased sanctions risk. These conditions should grant the customer the ability to unilaterally withdraw from contract execution in the event of United nations (UN), EU or national sanctions being imposed.

We also propose the inclusion of verification procedures encompassing the identification of end-users and recipients of goods that have been previously sold. If an item exported from the EU to a third country is re-exported to Russia, competent authorities may view the failure of the EU exporter to conduct thorough verification procedures as a violation of the Sanctions Regulation. Please be aware that cases in which an EU exporter deliberately omits such verification might be deemed a participant in a scheme to evade sanctions.

For information on good practice, see the Ministry of Foreign Affairs’ Practical Guidance for Economic Operators on Detecting and Preventing Avoidance and Circumvention of Trade Sanctions’. These guidelines highlight that all economic operators should have developed and implemented their company’s internal policies and control procedures to adhere to EU sanctions, aligning with the specifics of their business model. It is recommended that these internal documents are periodically updated.
 

Please note that during the implementation of sanctions, the Bank may request its clients to explain how they implement sanctions in their activities, whether they evaluate their partners, goods or services, and to provide the outcomes of such evaluations. In light of this, we recommend being prepared to provide the Bank with the appropriate documents.
 

For more information on the application of sanctions, you can refer to

• the European Commission’s website, under the FAQ section;
• the Šiaulių Bankas website, under Prevention of Money Laundering and Terrorist Financing and International Sanctions Compliance Policy;
• the Guidelines on sanctions compliance prepared by the Ministry of Foreign Affairs.