DENMARK Law and Practice Contributed by: Rikke Sonne, Jakob Skov Bundgaard and Tilde Nielsen Weidinger, Accura
1.3 Key Industries The sectors affected by sanctions vary depending on the specific sanctions regime imposed by the EU. As Denmark is a small and open economy with a great deal of exports, companies from many important sec - tors are involved in international business and thus may be affected by sanctions. However, some sec - tors tend to be more frequently targeted by the EU sanctions than others. The following are examples of sectors particularly affected in Denmark: • the financial sector and financial services; • companies exporting dual-use and/or military items; The EU sanctions regime comprises sanctions that can be applied to countries, individuals, groups, enti - ties and vessels, depending on what the EU seeks to achieve. The EU adopts sanctions by the following. • Implementing UN sanctions: implementing sanc - tions adopted by the UN Security Council into EU law. • Reinforcing UN sanctions: the EU may choose to reinforce UN sanctions by applying stricter meas - ures in addition to those set out by the UN Security Council. • Autonomous EU sanctions: the Council of the European Union may adopt sanctions on its own initiative (autonomous). These sanctions are typi - cally adopted for a period of 12 months at a time. The various sanctions can be divided into two categories: targeted sanctions and sectoral sanctions. Targeted sanctions prohibit all transactions or other dealings with specific individuals and entities. These types of sanctions typically include asset freezes and travel bans. Sectoral sanctions apply restrictions to certain types of transactions affecting a broader cat - egory of targets, including embargoes and restrictions on trading with certain goods in targeted territories. Sectoral sanctions also include economic and finan - • the defence sector; • the energy sector; • the luxury goods industries; and • the shipping sector. 1.4 Overview 1.4.1 Types of Sanctions
cial sanctions and prohibitions on trade with specific designated persons or entities in a particular sector. 1.4.2 Scope of Sanctions Denmark implements EU sanctions, which apply: • within the territories of EU member states; • aboard vessels or aircraft flying the flag or registra - tion of an EU member state; • to any individual holding EU member state nation - ality, regardless of whether that individual is located within or outside the EU; and • to any legal person, organisation or entity estab - lished under EU member state law or conducting commercial activity within an EU member state. In practice, this means for example that a Danish national resident outside the EU remains bound by the EU sanctions regimes by virtue of their nationality, just as a company incorporated in Denmark remains bound even where its day-to-day operations are con - ducted from a third country. EU sanctions are not formally exterritorial in nature, as seen with US secondary sanctions for example. How - ever, certain provisions do have extraterritorial effects, including, for instance, Regulation (EU) 833/2014 Article 8a, which contains a best-efforts obligation, requiring EU operators to ensure that entities they own or control in third countries do not engage in activities that undermine EU sanctions. Another example of the same regulation is its Article 12g, which carries an obligation to contractually prohibit the re-exportation of certain items to Russia. 1.4.3 Domestic and/or Supranational Measures In theory, Denmark could adopt independent national sanctions; however, in practice, sanctions are imposed by the EU and the UN.
2. Overview of Regulatory Field 2.1 Primary Regulators
Denmark operates a decentralised model within sanc - tions. The Danish Ministry of Foreign Affairs is respon - sible for general questions, and each sector author -
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