Prohibitions on Financial Transactions and Payments to Designated Entities
SINGAPORE: On Monday (Mar 14), the Monetary Authority of Singapore (MAS) issued two notices outlining financial measures concerning Russia. These measures include prohibitions on financial transactions with designated Russian banks and entities, as well as guidance on non-prohibited payments and transactions.
The first notice, similar to the Ministry of Foreign Affairs’ announcement on Mar 5, prohibits financial institutions (FIs) from dealing with specific Russian banks and entities. FIs are required to freeze any assets or funds already in their control related to these designated entities in Singapore. The four Russian banks named in the notice are VTB Bank, Vnesheconombank, Promsvyazbank, and Bank Rossiya.
The prohibition also extends to financial transactions related to raising new funds for the Russian government, its central bank, or any entities controlled by them. Furthermore, FIs are banned from engaging in financial transactions or providing services to individuals involved in sectors in the breakaway regions of Donetsk and Luhansk, including transport, telecommunications, energy, and the oil, gas, and mineral industries.
In addition, the MAS restricted the use of digital payment tokens for any prohibited transactions related to these activities.
MAS’ second notice clarifies which payments and transactions are not subject to the prohibitions. These include payments for basic expenses such as employee remuneration, insurance premiums, and tax payments. Transactions related to the maintenance of frozen funds or expenses for regulatory compliance, professional services like audit or legal fees, and specified transactions for withdrawal of funds from designated banks are also allowed.
FIs are required to maintain accurate and detailed records of all non-prohibited activities, whether on paper or electronically, for compliance purposes.
