LIECHTENSTEIN Law and Practice Contributed by: Lukas-Florian Gilhofer and Mathias Bitschnau, Ospelt & Partner Attorneys at Law Ltd
At the institutional level, Article 2c ISG contains spe - cific preventive obligations for financial intermediaries that are structurally designed to combat circumven - tion. The Financial Market Authority (FMA) has empha - sised the review obligation under Article 2c(1)(a) ISG, clarifying that a review is required in particular upon the establishment of a new business relationship, upon changes such as the addition of new author - ised signatories or agents, and immediately following the adoption or amendment of the relevant sanction’s ordinances. Regular review of the client base – for example on a weekly basis – is recommended. The prohibition on circumventing sanctions in Liech - tenstein is thus enshrined at multiple levels: in the ISG itself, through the individual sanction’s ordinances, and through directly applicable EU sanctions law adopted by virtue of Liechtenstein’s EEA membership. 7.3.2 Criminal Penalties Violations of the provisions of the ISG, including cir - cumvention, may be prosecuted as criminal offenc - es. The ISG distinguishes between two categories of offence: misdemeanours under Article 10 ISG and contraventions under Article 11 ISG, with the distinc - tion determined by the severity of the violation and the authority competent to impose the sanction. Under Article 10 ISG, any person who intentionally violates the provisions of a coercive measures ordi - nance based on the ISG – the violation of which is expressly declared to be a criminal offence – shall be
punished by the Court of Justice with a custodial sen - tence of up to three years or a monetary penalty of up to 360 daily rates. This provision addresses the most serious intentional breaches of the sanction’s regime. Article 11 (1) ISG covers less serious violations where no misdemeanour under Article 10 is present; juris - diction likewise lies with the Court of Justice, and the applicable sanction is a fine of up to CHF200,000. In addition, Article 11 (1a) ISG establishes a paral - lel regime of administrative criminal law, under which the Financial Market Authority (FMA) acts as the com - petent authority in its capacity as the due diligence supervisory authority. This provision applies to any person who intentionally violates the special compli - ance obligations under Article 2c ISG – in particular the obligation to review customers and transactions and to maintain appropriate internal control measures – and likewise provides for a fine of up to CHF200,000. This framework is broadly comparable to the minimum standards for criminal sanctions established at EU level by Directive 2024/1226 of 24 April 2024, which introduced minimum rules on the definition of criminal offences and sanctions for violations of EU restrictive measures, including measures concerning the freez - ing of funds and economic resources and prohibitions on making funds or economic resources available.
200 CHAMBERS.COM
Powered by FlippingBook