The Swiss State Secretariat for Economic Affairs ("SECO") updated its "Frequently Asked Questions" ("FAQs") on 21 December 2023. It contains, amongst other things, clarifications regarding reporting duties.
Bank face increased reporting duties (that partially apply retroactively). Reporting deadlines are very tight.
1. Additional reporting of frozen assets
Financial institutions are now required to provide SECO with updated figures on all amounts blocked due to the asset freeze under article 15 of the Ordinance as per 31 December 2023 .
This additional reporting must be made exclusively by means of the template Excel table provided on the SECO website . This obligation also applies if no movements occurred.
The information required in the reporting table includes:
- Account holder's name
- Banking relationship number
- Beneficial owner
- Information on the sanctioned person (SSID number, etc.)
- Date of initial blocking announcement
- Reason for freeze
- Amount of blocked assets initially declared
- Balance as of 31.12.2023.
In case of differences between the amount of assets initially reported and the balance as of 31 December 2023 , the financial institution must add an explanation in a dedicated section in the table.
The deadline for this reporting to SECO is 16 February 2024.
2. Additionnal transaction reporting
The FAQs also clarify the scope of the mandatory transaction reporting requirement under article 16 (1) bis of the Ordinance .
This reporting obligation covers information relating to any movements, transfers, modifications, use of, access to or manipulation of assets of sanctioned persons or entities in Annex 8 of the Ordinance during the two weeks prior to their listing.
It applies to all new entries in Annex 8, as well as retroactivelyto all previous entries to Annex 8.
A specific transaction table, which can be obtained upon request from SECO by e-mail , must be used to report these transactions.
For entries in Annex 8 up to 1 December 2023, the deadline for compulsory declaration is 29 March 2024. For all new entries to Annex 8 after 1 December 2023, the reporting must be done immediately.
3. Income from securities issued by companies or entities subject to financial sanctions: new annual reporting requirement
Regarding transactions aiming to distribute income from securities issued by sanctioned entities, the FAQs specify that as of 2024, in addition to the obligation to block and report to SECO upon receipt , financial institutions that perform the final accounting are now required to submit an annual summary of said transactions to SECO .
The deadline for this annual reporting to SECO is the end of February (value as of December 31 of the previous year).
The reported information must be classified by security (ISIN number) and must specify the following elements:
- Type of security
- Type of income (e.g. dividends, bond rates)
- Number of business relationships involved
- Number of transactions executed
- Value credited (total amount per currency). SECO does not propose any template reporting format.
4. What should banks do now?
Deadlines are very tight and banks are advised to start preparing their reporting well ahead of the applicable deadlines. In many cases, banks will have to file three separate reports.
Our team of sanction experts has great experience in dealing with reporting asset freezes to SECO and is happy to assist.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
