LIECHTENSTEIN Law and Practice Contributed by: Lukas-Florian Gilhofer and Mathias Bitschnau, Ospelt & Partner Attorneys at Law Ltd
meets international standards through three legislative instruments: • the International Sanctions Act (ISG); • the War Materials Act ( Kriegsmaterialgesetz , KMG); and • the Nuclear and Dual-Use Goods Control Act ( Kernenergiegesetz und Güterkontrollgesetz , KEGKG). Prohibited goods subject to this regime include, in line with the corresponding EU measures, items such as dual-use goods and technology for military use, war materials and nuclear-related goods and tech - nologies. 6. Civil Litigation and Arbitration 6.1 Force Majeure Under Liechtenstein law, the courts have not yet developed any express case law on sanctions as a bar to the performance of contractual obligations, at least in published decisions. Nevertheless, the close alignment of Liechtenstein with EU sanctions law and Swiss practice suggests that Liechtenstein courts would in principle recog - nise sanctions-related refusals to perform as lawful and as excluding contractual liability. This approach finds support in the clear legislative policy decision expressed in Article 2a ISG, which reflects the under - lying public-interest rationale of the sanctions regime. Much as the French Cour de cassation declined in 2020 to allow sanctioned persons to invoke asset freezes as a case of force majeure – on the ground that doing so would have enabled debtors to rely on restrictive measures to justify non-compliance with their obligations, thereby undermining the legitimacy of the sanctions – Liechtenstein courts would similarly be unlikely to permit the sanctions regime to be instru - mentalised in favour of the very persons it targets. For Liechtenstein economic actors, it is accordingly recommended that contractual arrangements include a clause expressly foreseeing the possible imposition of sanctions on either contracting party and providing for a solution should such a scenario occur, thereby
avoiding legal uncertainty as to the consequences of non-performance in a sanction’s context. 6.2 Enforcement No specific Liechtenstein court decisions address - ing the enforcement of foreign judgments in circum - stances where sanctions issues arise have been pub - lished to date. In the absence of express case law, the general framework applicable in Liechtenstein would nonetheless lead to a comparable outcome to that reached in other jurisdictions.
7. Designation, Compliance and Circumvention 7.1 Executive Body
Unlike certain other jurisdictions – such as the United States, where designation decisions are taken by the Office of Foreign Assets Control (OFAC) – the Europe - an Union, where the Council of the EU decides which natural and legal persons to subject to restrictive measures, or the United Kingdom, where the Office of Financial Sanctions Implementation (OFSI) plays a comparable role – Liechtenstein does not as a rule make autonomous designation decisions and does not maintain its own public sanctions list. The designation process in Liechtenstein is accord - ingly not political in the domestic sense. Rather, des - ignation decisions are made at the international or supranational level, and Liechtenstein subsequently implements them at the national level through the ISG and the relevant implementing ordinances. Concretely, Liechtenstein implements UN sanctions as a matter of international obligation and, as an EEA member, vol - untarily adopts EU restrictive measures. In addition, by virtue of its customs union with Switzerland, Liechten - stein takes into account Swiss economic sanctions. The process is therefore, in each case, driven by the originating international or European body – whether the UN Security Council, the Council of the EU, or the Swiss authorities – rather than by any autonomous Liechtenstein decision-making procedure. 7.2 Scope of Designation The principle of indirect capture of legal entities that are owned or controlled by a designated person is
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