CZECH REPUBLIC Law and Practice Contributed by: Jan Kohout and Illia Antonov, PRK Partners
3. Recent and Future Legal Developments 3.1 Significant Court Decisions or Legal Developments Apart from the only final decision on a criminal offence rendered to date, as described in 2.2.4 Criminal Enforcement Action , significant decisions include those described in 2.2.3 Civil Enforcement Action , which provide general interpretation of the compe - tence of Czech authorities when applying and imple - menting international sanctions. In recent years, several court decisions have con - firmed the denial of access to, or the grounds for freezing, assets of designated persons, establishing a general landscape of broad and strict interpretation of sanctions regimes. 3.2 Future Developments The Czech Republic is bound to apply the EU sanc - tions regimes. Given the ongoing Russian aggression in Ukraine, developments at EU level are most likely to continue the previously adopted approach of inten - sifying sanctions pressure on Russia and combating the circumvention of sanctions via intermediaries in third countries. Whilst in recent years the Czech Republic has been active in proposing certain listings of additional per - sons under the EU sanctions regimes, and in listing them under its own national sanctions regime until listing at EU level is achieved, such activities appear less likely in the current political landscape.
of derogations under the respective sanctions regime – primarily the directly applicable EU sanctions regime – and setting out general grounds for derogations, such as health and humanitarian reasons, social pay - ments, payment of salaries, damages, and other pay - ments arising from non-sanctioned legal grounds. In practice, the relevant EU sanctions regimes serve as the material grounds for derogation. In its recent annual reports, the FAU mentions that licensed derogations predominantly concern the phar - maceutical sector, energy (in particular nuclear) sector and the sale of Czech real estate by Russian owners. 2.3.2 Provision of Legal Services Along with the directly applicable EU sanction regula - tions, provision of legal services to designated per - sons is not prohibited when strictly necessary: • for the exercise of the right of defence in judicial proceedings and the right to an effective legal remedy; and • to ensure access to judicial, administrative or arbi - tral proceedings in a member state. In other cases, such as transaction-related legal advice, provision of legal services may be deemed not only as a breach of international sanctions, but also as a breach of AML duties, which require sanc - tions screening as one of the cornerstones. 2.4 Reporting Reporting obligations are usually imposed by the relevant bodies in individual decisions concerning derogations or exemptions from sanctions regimes. They are generally aimed at monitoring the use of the respective derogations. There is also a specific, generally applicable require - ment under Czech law to report on: • any property that may be subject to international sanctions held by a (non-designated) person, and • any contracts entered into with persons subject to international sanctions known to a non-designated person.
4. Delisting Challenges 4.1 Process
The Czech national sanctions regime provides for the possibility of objecting to a designation under the national sanctions regime. Objections are lodged via the Ministry of Foreign Affairs and are decided by the government. Judicial review of the government’s decision is available, having no derogatory effect and providing for limited access to classified information compared to standard proceedings.
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