Australia and sanctions

On 19 May, AUSTRAC released ‘the second public consultation on new AML/CTF Rules’. Among the proposed changes include the requirement for reporting entities regulated by AUSTRAC to develop, maintain and comply with policies to ensure that they do not contravene targeted financial sanctions obligations, including asset freezing, in the provision of their designated services.

In accordance with regulation 6A(4) of the Autonomous Sanctions Regulations 2011, the Minister for Foreign Affairs has designated two individuals for targeted financial sanctions and declared them for travel bans.

The Australian Sanctions Office (ASO) has released 10 new guidance and advisory notes to assist the regulated community understand their sanctions obligations.

This guidance note sets out how Australian sanctions laws apply to Australian citizens, and foreign residents living in Australia, considering employment with designated persons or entities. 

Targeted financial sanctions have been implemented by the United Nations Security Council (UNSC) and / or the Australian Government against holders of political office including current and former ministers from a range of countries.

Within the financial sector, there are instant payments systems known as remittance services that allow users to send and receive funds almost immediately. These systems operate at high speeds and volumes, posing questions about sanctions compliance measures.

Australian touring companies and sports professionals are subject to increased risk of sanctions contravention generally when participating in activities in countries subject to Australian sanctions. It is essential for these entities and individuals to be fully aware of their sanctions obligations when organising or engaging in activities in jurisdictions where such sanctions exist. 

The IT sector includes companies involved in the provision of products and services, including software, hardware, networking, cybersecurity, and cloud computing. Telecommunications and webhosting companies also face sanctions risks when providing services or infrastructure.

Low-risk sectors in relation to sanctions refer to areas of business activity that are less likely to be directly targeted by sanctions or have a lower potential for sanctions contraventions. While it is challenging to classify any sector as entirely 'low risk' some areas are typically regarded as having less exposure to sanctions.

Australia has imposed autonomous sanctions on the importation of certain Russian-origin energy goods, including petroleum gases, oil, and refined petroleum products. These goods are Russia's largest source of export revenue. By sanctioning these goods, Australia aims to diminish Russia's ability to finance its illegal and immoral invasion of Ukraine.