The United States recently decided to put Cuba back on the list of state sponsors of terrorism . This decision may seem far away from us, but it may well have major indirect consequences for Dutch companies and financial institutions when taking into account the AML, international sanctions and European regulations.
Protection from the EU
To protect European companies from such sanctions, the European Union introduced what is known as the Blocking Statute . This regulation prohibits European companies from cooperating with certain foreign sanctions, such as those imposed by the U.S. against Cuba. In addition, it provides legal means to recover damages resulting from non-compliance with the foreign sanctions.
This sounds like a good solution, but in practice it creates a difficult playing field. Dutch companies must balance between U.S. rules and European protection from those same rules. The result? A complicated situation in which companies must operate cautiously to avoid legal and financial risks.
How do US sanctions affect Dutch companies?
US sanctions against Cuba have an extraterritorial effect. These sanctions can certainly affect companies outside the U.S. that, for example, trade in U.S. dollars or have a relationship with U.S. banks. For Dutch companies engaged in international trade, this can pose considerable challenges, such as:
- Additional costs: Consider stricter compliance requirements and due diligence investigations.
- Restrictions in business relationships: Relationships with Cuban parties or customers could potentially become a risk.
- Complex financial transactions: This is especially applicable if U.S. banks are involved.
What does this mean for the AML and your organization?
The indirect effects of the U.S. sanctions may make compliance with the Money Laundering and Terrorist Financing Act more difficult. Dutch companies may have to revise their compliance processes to meet all regulations. Good preparation is essential in this regard. A few practical steps:
- Stay informed
Make sure you know the latest developments around international sanctions, the AML, European regulations and their potential impact. - Invest in compliance processes
Reliable systems for transaction monitoring and customer research make the difference. This helps you identify risks and comply with all requirements without having to worry about it. At SCOPE FinTech Solutions, we help companies get a grip on these challenges. Our technology supports you in complying with the AML. - Collaborate with experts
Compliance is not an area you should gamble on. By collaborating with professionals, for example in the field of financial regulation and technology, you can reduce risks and improve compliance with complex rules.
Although the U.S. sanctions against Cuba do not cause direct changes to the AML, they do affect how Dutch companies must set up their compliance. Companies must adapt to a world where international and European rules often clash.
Want to know more about how we can improve your compliance? Feel free to contact us. We are happy to think along with you.
