Financial regulator announces thawing of Libyan assets

The airline Afriqiyah Airways, the Libyan National Oil Corporation and Zuietina Oil Company are now no longer sanctioned under Maltese law.

On 16 September, the United Nations Security Council Resolution 2009 released various Libyan entities which had their assets frozen by the UN.

This has modified the asset freezing requirements in respect of Central Bank of Libya, Libyan Arab Foreign Bank, Libyan Investment Authority and Libyan Africa Investment Portfolio.

It is now required that funds, other financial assets and economic resources belonging to, owned, held or controlled, directly or indirectly by these entities outside Libya as at 16 September 2011 shall remain frozen.

Additionally, the Regulation allows making funds or economic resources available, directly or indirectly, to or for the benefit of these four entities.

Effectively, Council Regulation (EU) 965/2011 allows new transactions to be entered into with these entities. But funds frozen before 16 September 2011 should be maintained and any movements only conducted with the authorisation as required by relevant legislation.

The UN resolution and the new EU regulation allows member states to authorise the release of frozen funds to the Libyan people specifically for:humanitarian needs, fuel, electricity and water for strictly civilian uses, resuming Libyan production and sale of hydrocarbons, establishing, operating, or strengthening institutions of civilian government and civilian public infrastructure, or facilitating the resumption of banking sector operations, including to support or facilitate international trade with Libya.

Funds can only be released following approval of the UN Sanctions Committee and after consultation and approval by the Libyan National Transition Council.

The MFSA reminded licence holders to continue to exercise vigilance, to monitor their business relationships and to verify their records on an on-going basis to ensure that they do not in any way support activities, individuals or entities which are subject to sanctions or other restrictive measures which remain in place.