Singapore and UK - Sanctions Update

  • Market Insight 14 July 2022 14 July 2022
  • Asia Pacific

  • Energy & Natural Resources

On 5 March 2022, the Singapore Ministry of Foreign Affairs formally released the package of sanctions and restrictions that Singapore would impose against Russia, aimed at constraining Russia’s capacity to conduct war against Ukraine and undermine its sovereignty.

This comes on the heels of the announcement by Singapore’s Minister for Foreign Affairs in Parliament on 28 February 2022, of Singapore’s intention to act in concert with other like-minded countries to impose appropriate sanctions and restrictions against Russia.

The sanctions imposed can be grouped into two main categories:

  1. Export Controls; and
  2. Financial Measures.


Export Controls

In order to constrain Russia’s capacity to conduct its war in Ukraine and cyber aggression, the export, transit and transhipment of the following items will be banned:

  1. All items on the List of Military Goods under the Strategic Goods (Control) Order 2021 (“SGCO”); and
  2. All items that fall under Category 3 (Electronics), Category 4 (Computers) and Category 5 (Telecommunications and Information Security) of the Dual-Use Goods List of the SGCO 2021.


Financial Measures

The Singapore government will impose financial measures targeted at designated Russian banks, entities and activities in Russia, and fund-raising activities benefiting the Russian government. These measures apply to all financial institutions in Singapore, including banks, finance companies, insurers, capital markets intermediaries, securities exchanges, and payment service providers.

Importantly, all digital payment token service providers will be specifically prohibited from facilitating transactions that could aid the circumvention of the financial measures.

In particular, financial institutions will be prohibited from:

  1. Entering into transactions or establishing business relationships with the following Russian banks:
    • VTB Bank Public Joint Stock Company;
    • The Corporation Bank for Development and Foreign Economic Affairs Vnesheconombank;
    • Promsvyazbank Public Joint Stock Company; and
    • Bank Rossiya

Where there are existing business relationships, financial institutions must freeze any assets and funds of these four banks.


  1. Providing financing or financial services in relation to the export from Singapore or any other jurisdiction of goods subject to Singapore’s export controls on Russia:
    • These goods comprise all items in the Military Goods List and specified categories in the Dual-Use Goods List of the SGCO.


  1. Providing financial services in relation to designated Russian non-bank entities which are involved in activities in (b):
    • For existing relationships with these entities, any of their assets and funds must be frozen. Further details on the designation of these entities will be provided subsequently.


  1. Facilitating fundraising activities by the Russian government and the Central Bank of the Russian Federation, or any entity owned or controlled by them or acting on their direction or behalf.
    • This prohibition extends to the sale and purchase of new securities, the facilitation of new fundraising by these entities and the participation in the making of any new loan to these entities. Additionally, the Singapore Government and Monetary Authority of Singapore will cease investing in newly issued securities of these entities.


  1. Entering into transactions or providing financial services in the following sectors, in the regions of Donetsk and Luhansk:
  • transport;
  • telecommunications;
  • energy; and
  • prospecting, exploration and production of oil, gas and mineral resources sectors.


  1. Entering into or facilitating any transactions involving cryptocurrencies which circumvent any of the above prohibitions in (a) to (e) above.
    • These prohibited transactions cover all transactions that involve cryptocurrencies and extend to the payment and settlement of transactions that relate to digital assets (such as non-fungible tokens).


UK Update

The UK national Crime Agency and the OFSI issued a red alert to all entities in respect of lessons learned relating to people attempting to circumvent sanctions, which can be found here:

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The key recommendations are as follows:


1. Arms-length transactions need to be documented and should not be taken at face value by firms. Firms are advised to seek guidance from OFSI if they have any doubt. This is important not only for financial institutions, but also for professional services firms, when you are assessing indirect control a Designated Person may exert over the entity.


2. A failure to undertake appropriate due diligence, for example wilful blindness in relation to source of funds or wealth checks, should be considered a red flag for complicity and both breach and/or circumvention offences.


3. Firms should assess complex corporate structures carefully as a component of their enhanced due diligence for high-risk clients, querying the commercial justification for such structures.



4. It should be noted that issues of aggregation of ownership can be further complicated where differing approaches to aggregation of ownership are applied across the EU, UK and US and more than one owner seeks to divest their shareholding. Again, firms are advised to seek guidance from OFSI if in doubt.


5. Where firms are presented with documentation that purports to present a change in ownership by a company linked to a Designated Person, it is important not only to conduct enhanced due diligence, but to follow up with the relevant competent authority (OFSI in the UK) to understand if firms have reason to believe that ownership has not been transferred appropriately.


6. In instances where companies have provided their own legal assessments regarding the transfer of ownership, firms should also carry out their own legal assessment in order to come to their own determination.


As a tool of foreign policy, UK sanctions have jurisdiction over:

  • England, Wales, Scotland and Northern Ireland, as well as the Crown Dependencies and Overseas Territories (which includes the British Virgin Islands).
  • All UK persons worldwide are required to comply owing to the extra-territorial application of the Sanctions & Money Laundering Act 2018


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