International Financial Sanctions
National Framework
At the national level, the Law of 19 December 2020 on the implementation of restrictive financial measures establishes the legal framework for enforcing financial sanctions.
The Act of July 20, 2022, establishes a committee to monitor financial restrictive measures and amends:
- Article 506-1 of the Penal Code;
- The Act of December 19, 2020, on the enforcement of financial restrictive measures.
It supplements the framework established by the Act of December 19, 2020, by creating a committee to monitor financial restrictive measures and by making several targeted amendments to the latter.
The committee to monitor financial restrictive measures is tasked with monitoring the implementation of financial sanctions adopted by resolutions of the United Nations Security Council and acts of the European Union.
In particular, it is responsible for contributing to:
- The development, coordination, and evaluation of national policies and strategies regarding the implementation of financial sanctions;
- The dissemination of knowledge concerning the implementation of financial sanctions.
Compliance with financial sanctions is not limited to financial sector professionals. It also applies to: natural persons of Luxembourgish nationality, whether residing or operating within or from the territory of the Grand Duchy of Luxembourg or abroad; legal entities with their registered office, a permanent establishment, or their principal centre of interest in the Grand Duchy of Luxembourg, and which operate within or from Luxembourg or abroad; branches of Luxembourgish legal entities established abroad, as well as branches in the Grand Duchy of Luxembourg of foreign legal entities; and all other natural and legal persons operating within the territory of the Grand Duchy of Luxembourg.
Ministry of Finance
The Minister of Finance is responsible for addressing all matters relating to the implementation of financial sanctions, both for those subject to such measures and for those obliged to enforce them.
For reference, the lists of financial sanctions applicable in Luxembourg are as follows:
It should be noted that these lists do not replace the official legal instruments, which must be consulted for authoritative guidance.
In accordance with Article 6(1) of the aforementioned law, credit institutions, financial sector professionals (PSF), financial institutions, insurance companies, and all other natural and legal persons required to enforce these prohibitions and restrictive financial measures must inform the Ministry of Finance of the specific implementation of each prohibition or restrictive measure taken against a state, individual, entity, or group:
- By post to the following address:
Ministry of Finance
3 Rue de la Congrégation
L-1352 Luxembourg - Or by email to: sanctions@fi.etat.lu.
Pursuant to the Grand-Ducal Regulation of 14 November 2022, which clarifies the Law of 19 December 2020 on the implementation of restrictive financial measures, the execution of such measures must be carried out without delay and without prior notification.
Similarly, the Ministry of Finance must be informed without delay of the enforcement of restrictive measures.
For further information, please consult the section dedicated to international financial sanctions on the Ministry of Finance website:
Supervisory Authorities and Self-Regulatory Bodies
Under the Law of 19 December 2020, supervisory authorities and self-regulatory bodies are responsible for monitoring the implementation of restrictive financial measures.
Below are the links to the dedicated pages on international financial sanctions for each relevant authority and body:
FATF – Targeted Financial Sanctions Related to the Financing of the Proliferation of Weapons of Mass Destruction
Under Recommendation 7, the Financial Action Task Force (FATF) stipulates that countries should implement targeted financial sanctions in accordance with United Nations Security Council resolutions aimed at preventing, suppressing, and disrupting the proliferation of weapons of mass destruction and their financing. These resolutions require countries to freeze without delay the funds and other assets of, and ensure that no funds or assets are made available—directly or indirectly—to or for the benefit of any person or entity designated by, or under the authority of, the United Nations Security Council pursuant to Chapter VII of the United Nations Charter.
The FATF has also published reports and guidelines, available below:
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