Switzerland defends decision to omit subsidiaries from Russian sanctions | U.S. & World

By Tommy Reggiori Wilkes

ZURICH (Reuters) -Switzerland is “unequivocally committed” to sanctions against Moscow, the government said on Friday, after it decided not to adopt in full a package of European Union measures, a decision the U.S. ambassador said was disappointing.

As Western governments try to cut off Russia’s means to finance its war on Ukraine, U.S. officials have pressed Switzerland to do more to close loopholes given the country’s role as a global financial centre and a commodity trading hub.

The State Secretariat for Economic Affairs (SECO), the department which oversees Switzerland’s sanctions regime, said in a statement emailed to Reuters the decision not to implement the full EU sanctions package this week was “not politically motivated”.

“Switzerland is unwaveringly and unequivocally committed to sanctions against Russia,” it said.

The government took issue with wording that requires companies prevent circumvention via their subsidiaries “to the best of their ability”.

“It will be quite unclear to companies what measures they are required to take,” SECO said, adding the government would consider adopting a version of the clause were it more precise.

Switzerland has mostly adopted in full sanctions the EU has imposed against Russia since Moscow’s war in Ukraine began in February 2022.

But Switzerland also seeks to maintain a policy of neutrality dating back more than two hundred years.

SECO said it already prosecutes violations of sanctions via third countries, as long as the violation was orchestrated from Switzerland.

In also said it would investigate commodity traders based in Switzerland suspected of violating the law. One “particularly flagrant” case had already been transferred to prosecutors, it said, without giving details.

“The Federal Council’s decision to not fully adopt all components of the 14th package of EU sanctions yesterday (Thursday) is disappointing, and we hope it will work to close the loophole that enables overseas subsidiaries to evade sanctions,” U.S. Ambassador Scott Miller said in a statement on Friday.

(Reporting by Tommy Reggiori WilkesEditing by John Revill and Barbara Lewis)

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Publish date : 2024-10-18 05:40:00

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