:: Obligations of the Implementing Parties

 

Determining the Implementing Parties

1. Financial Sector:
 
  • Banks and Exchange Houses.
  • Money or Value Transfer Service(MVTS) Providers.
  • Insurance and Reinsurance Companies.
  • Finance or Investment Companies.
  • Financial brokerage firms/ Intermediaries.
  • Qatar Stock Exchange.
  • Qatar Central Security Depository.
2. Designated Non-Financial Business and Professions (DNFBPs):
 
  • Lawyers.
  • Authorized Notaries.
  • Real-Estate Agents.
  • Legal Accountants.
  • Traders in precious metals and stones.
  • Trust and Company Service Providers.
3. Supervisory Authorities of Financial Institutions (FIs), Designated non-financial business and professions(DNFBPs), and Non-profit organizations(NPOs):
 
  • Qatar Central Bank (SPERVISORY AUTHORITY).
  • Qatar Financial Markets Authority (QFMA).
  • Ministry of Justice (MOJ).
  • Ministry of Commerce and Industry (MOCI).
  • Qatar Financial Center of Regulatory Authority (QFCRA).
  • Regulatory Authority for Charitable Activities (RACA).
4. Any administrative, security or supervisory authority concerned with implementing the targeted financial sanctions regime

such as the Ministry of Interior, Ministry of Foreign Affairs, Ministry of Finance, Ministry of Endowments and Islamic Affairs, Ministry of Administrative Development, labour and Social Affairs, Ministry of Transport and Communication, Real Estate Registration Department, The General Directorate of Traffic , and Civil Aviation Companies operating in the State of Qatar…

5. Each person in the State who holds funds or economic resources relating to designated persons or entities on the sanctions list.
 

Checking Name Matches of the Persons and Entities and Processing Notifications

  • An effective and appropriate application/ electronic system must be developed to accommodate customers’ database (repertoire) and various financial flows simultaneously, to ensure the following:
    • Real time monitoring of the financial transaction, and when necessary, freeze related funds before completion of such transaction.
    • Screening the names of all customers to ensure they are not designated on the Sanctions List.
    • Checking all data in relation to the customer and the second party to the transaction
    • Checking any transactions in relation to the financial transaction
  • In case of adopting manual screening system for customer database and financial flows due to the modest size of activity and the pattern of transactions of the supervised entity, the implementing party must ensure that the adopted manual system enables the effective processing of notifications to be validated and submitted in due time; As well, said party must in all cases, explain to the bank the reason for adopting the manual screening system and prove to the bank that such manual system will achieve the same expected result of the electronic system.
  • During the processing of a notification, the operation must be suspended until the final processing is completed. When the notification is related to a person or entity other than the designated person or entity, the notification shall be made without the need for freezing the funds.
  • A sufficient number of trained staff must be made available and provided with the necessary practical means to review, examine and process the notifications, in order to ensure the quick implementation of freezing.
  • The processing of notifications must ensure that the person or entity detected in the database or upon carrying out an occasional transaction is the same person or entity subject to the designation order and not a person or entity with the same name or trade name, in order to prevent carrying out the transaction and to implement the freezing of funds.
  • The obligation of verifying matches must be met before and during the course of a business relationship.
  • The verification and validation of matches must include the full name, and not only the first name, middle name or family name, in addition to the data usually available in the designation order such as the address, nationality, passport number, tax identification number, place of birth, date of birth, previous names or aliases with regard to the natural person; or the activity, registration number and other relevant data with regard to the entity, and validate these data with the customer database.
  • Exact match must be excluded; reliance must be made as much as possible on speculation and compatibility with regard to the name of the customer and second party to the transaction, in order to identify different name variants and partial matches of names of the customers , entities and their branches , particularly if written in foreign languages.
  • In order to identify the designated persons and entities whose funds are subject to monitoring and freezing, the implementing parties may rely on the Sanction list published on the NCTC website. In case of relying on the lists provided by the service providers, the implementing party must ensure continuous communication with the service provider to keep said lists current and that they include all the designated persons and entities subject to freezing.
  • If the notification and match is validated for a designated person or entity, the implementing party must promptly freeze the funds and notify the Supervisory Authority and the NCTC no later than (48) hours of notification of the designation, and file without delay a suspicious report with the QFIU.
  • The notifications and reports referred to above must contain as much data as possible, including, at minimum, the following:
    • Details related to whether there is any direct or indirect link between the conducted or attempted operations and transactions subject of the report and any other designated person or entity.
    • Details related to the financial flows, including the incoming transfers which led to the balance increase of the frozen account.
    • Details related to any attempt to breach the obligation of prohibiting the provision of funds and services for the benefit of the person or entity subject to freezing.
  • If the notification cannot be made, owing to the inability to distinguish between same or similar names, or to the lack of data, or doubt about the information required to verify identities, the implementing party must suspend the operation and immediately communicate with the NCTC or the Supervisory Authority via telephone, e-mail or fax.
 

Effective Implementation of Freezing

  • All funds of the designated person or entity shall be frozen immediately within (8) hours from the notification of the NCTC and maximum within (24) hours from designation on Security Council List, without delay or prior notification to the designated person or entity.
  • All funds of the designated person or entity listed on Sanctions List under a decision of the Public Prosecutor, upon the proposal of the NCTC, shall be frozen immediately without delay within (12) hours from the announcement date of the designation order, without prior notification to the designated person or entity.
  • FIs, DNFBPs and NPOs, shall notify the NCTC about the measures taken to implement the freezing order as follows:
    • Within (48) hours of the notification of the designation order, they shall submit a First Report on the measures taken, which shall include the value and type of the frozen funds, the date and time of freezing, and any attempted or completed transactions.
    • Within (30) days of the notification of the designation order, they shall submit a Second Report on any updates related to the first report and any additional actions taken.
    • They shall also submit additional and complimentary reports in case of change in the information and data related to the frozen funds and economic resources.
  • The implementing parties must ensure that the above reports include instances where the verification of the name of the designated person or entity does not match the database of the existing or occasional customers or instances of verification that validate the match but no funds to be frozen are found.
  • Reports shall be referred immediately to the NCTC and Supervisory Authority via e-mail, provided that the Supervisory Authority shall send originals of the reports and attachments to the NCTC through administrative means.
  • The Supervisory Authorities of FIs, DNFBPs and NPOs shall:
    • Immediately refer a copy of the aforementioned reports to the QFIU.
    • Immediately notify the Public Prosecution, the NCTC and the QFIU on any attempted transaction related to the frozen funds.
  • The freezing includes various means of payment and financial services, which are prohibited to be delivered or made available to the person or entity subject to freezing.
  • It is prohibited to make any funds or payments available directly to or for the benefit of the person subject to freezing, including transferring funds, acting on behalf of the person subject to freezing or making payments for his benefit, or generally taking any action that will make the funds available to the benefit and disposition of that person.
  • It is prohibited to make any funds available indirectly to the person subject to freezing. If there is another person holding funds for the designated person or is controlled by, or acts on behalf of, or at the direction of the designated person, such funds must be frozen. In general, the freezing must in all cases take place when the implementing party has knowledge that the designated person or entity will eventually be the ultimate beneficial owner of the funds.
  • In order to ensure that the operation or transaction does not aim at making funds available indirectly to a designated person or entity, the preventive measures stipulated in Chapter (3) of the the Law No. (20) of 2019 must be implemented.
  • Debt transactions must be suspended unless otherwise authorized by the Public Prosecutor.
  • Credit transactions must be recorded, and payment of any interests or other earnings due to the frozen accounts must be allowed, provided that such interests and earnings are frozen.
 

Freezing Typologies related to Legal Persons (companies, institutions, associations or any similar entity)

  • The criterion of control over the entity resulting in the freezing of its associated assets is met, if the designated person is in the possession of 50 % or more of the proprietary rights of an entity or has a majority interest in it.
  • The designated person or entity meets the criterion of control over the legal person or entity in any of the following cases:
    • Exercising the power to appoint or remove a majority of the members of the administrative, management or supervisory body of such legal person or entity.
    • Having appointed, solely as a result of the exercise of one’s voting rights a majority of the members of the administrative, management or supervisory bodies of a legal person or entity during the present and previous financial year.
    • Controlling alone, pursuant to an agreement with other shareholders in or members of a legal person or entity, a majority of shareholders or members voting rights in that legal person or entity.
    • Having the right to exercise a dominant influence over a legal person or entity, pursuant to an agreement entered into with that legal person or entity, or to a provision in its Articles of Association or Statures , where the enforceable law permits its being subject to such agreement.
    • Having the right to exercise a dominant influence over the legal person or entity in conformity with the foregoing item , without being the holder of that right, including by means of a front company.
    • Having the right to use all or part of the assets of a legal person or entity.
    • Managing the business of a legal person or entity on a unified basis, through publishing consolidated accounts.
    • Sharing jointly and severally the liabilities of a legal person or entity or guaranteeing them.
  • The freezing applies initially on the interests, dividends and earnings of the designated person or entity, depending on the interests owned by that person in the company and the relevant due profits and earnings as long as they can be separated. The ownership right of the remaining shareholders/partners will not be affected, as long as it has not been established that the company is controlled, directly or indirectly, by that designated person or entity.
  • If the person or entity designated on the sanctions list shares the ownership of the same entity with another non- designated person, and they both manage that entity, and it is not possible to separate the interests owned or managed by each of them, all the funds of the entity (assets, properties, interests, profits and earnings etc,.) must be subject to freezing.
  • The freezing imposed on the funds of the designated person applies to the assets and financial services associated with the entities owned or controlled, directly or indirectly, by such designated person, although the names of those entities do not appear on the sanctions list.
 

Unfreeze Requirements

  • In the case of false positives, the implementing parties shall:
    • Decide on the request no later than (24) hours from the date of receiving the relief request.
    • If the implementing party is satisfied with the relief request, it shall spontaneously unfreeze the funds and immediately notify the petitioner, the NCTC and the supervisory authority.
    • Draft a written notice in the case of rejecting the relief request, and send the rejection notice immediately within (24) hours of issuance to the petitioner, the NCTC and the supervisory authority.
    • Implement the PPO decision and release the frozen funds within (24) hours from the date of the decision. >Implement the PPO decision and release the frozen funds within (24) hours from the date of the decision.
  • Upon issuance of the Public Prosecutor’s delisting order from the Sanction list, the implementing party shall ensure the prompt termination of sanctions upon de-listing, including the release of frozen funds within maximum (3) business days.
  • Upon the issuance of the Public Prosecutor unfreeze order for bona fide third parties, the implementing party shall initiate the release of the frozen funds immediately upon receiving the notification of the NCTC.
  • In case of Exemptions from freeze to cover Basic or Extraordinary expenses, the implementing party shall:
    • Implement the authorization order issued by the Public Prosecutor to unfreeze the authorized fixed amount immediately, upon receiving the notification of the NCTC.
    • Submit a report to the relevant supervisory authority on any actions taken to implement the order issued by the Public Prosecutor, within (3) working days of the implementation.
    • Submit periodic reports to the relevant supervisory authority on the disposal method of the funds used to cover basic and extraordinary expenses.
 

The Penalties for Violating Obligations of the Implementing Parties

  • The violation of a designation order, gross negligence or willful infringement to the preventive measures of the implementing parties, shall entail penal sanctions imposed by the judicial authorities, and administrative sanctions applied by the supervisory authorities.
  • The contravenes of designation order shall be sentenced to imprisonment for a period not more than (3) three years and a fine not more than QR 10,000,000 (10) million Qatari Riyals, or one of these two penalties. In addition, complimentary measures may be applied such as Prohibition of residence in a particular place, Obligation to reside in a particular place, Prohibition from frequenting particular places or premises.
  • The gross negligence or willful violation of the preventative measures stipulated in articles (8) and (82) of Law (20) of 2019 Promulgating the Law of Combating Money Laundering and Terrorism Financing, shall be sentenced to imprisonment for a term not exceeding two (2) years or a fine not less than QR 5,000,000 (5) million Qatari Riyals, or one of these two penalties.
  • The administrative and financial penalties for violating preventative measures related to the targeted financial sanctions, include the many measures stipulated in article (44) of Law (20) of 2019, which consist of different levels of measures according to the seriousness of the violation, starting from sending written warnings to withdrawing and revoking licenses and registration, in addition to other similar financial measures stipulated in article (44) of the aforementioned Law.
 

Frozen Funds that Require Active Management

  • In all cases where the nature of the frozen funds requires active management, the Public Prosecutor shall determine the person or authority, responsible for managing such funds.
  • The person/authority in charge of managing the frozen funds shall receive such funds and initiate an inventory thereof in the presence of the Public Prosecutor's representative and a competent expert, depending of the nature of such funds, after seeking the presence of the persons concerned or their representative(s) pursuant to the Law.
  • The person/authority assigned to management shall be responsible for safekeeping and properly managing such funds, and shall subsequently return such funds together with the collected yields and revenues, upon the termination of the freezing or of the relevant assigned obligations, pursuant to the provisions of the Civil Code.
  • The person/authority in charge of managing the frozen funds shall oblige to maintain the confidentiality of the information, data, and documents made available to them, or obtained, or exchanged in implementing their assigned task; and shall not disclose the source of such information, even after the end of their assigned task.
  • The person/authority assigned to management shall take adequate measures to taking into account the interests and rights of bona fide third parties having interest in the frozen funds.