- Introduction
- Sanctions and Licenses: The Beginning of the Conflict
- Moscow Exchange's Response Measures
The Moscow Exchange is not sitting idle after the US imposed sanctions on them in June. They are preparing to retaliate with the help of their legal advisors from Step Forward.
Introduction
At a meeting with the Investor Rights Defense Club on August 19, a representative from Step Forward presented the Moscow Exchange's strategy. This includes challenging the US Office of Foreign Assets Control (OFAC). Part of the plan involves directly contacting OFAC for clarification on how general licenses can be used to unblock assets.
Sanctions and Licenses: The Beginning of the Conflict
On June 12, OFAC imposed sanctions on the Moscow Exchange and its affiliates, such as the National Settlement Depository (NSD) and the National Clearing Center (NCC). They issued a license to wrap up operations with these entities until August 13, later extending it to October 12. The next day, the UK followed suit by sanctioning the same companies. The UK’s Office of Financial Sanctions Implementation (OFSI) allowed the unblocking of assets through NSD until October 12.
Moscow Exchange's Response Measures
The Investor Protection Club’s legal consultant, Delcredere, noted that the Belgian Treasury and the Luxembourg Ministry of Finance do not automatically follow US and UK sanctions when unblocking assets in NSD accounts. Euroclear and Clearstream might still require US or UK licenses if the assets are linked to their jurisdictions. OFAC’s license, valid until October 12, might help unlock assets in NCC accounts with major US banks such as JP Morgan Chase and BNY Mellon, but with restrictions. These banks claim that only American entities can handle such transactions. The Moscow Exchange, consulting with Step Forward, is considering directly approaching JP Morgan Chase and BNY Mellon to determine if assets can be moved under General License 100A.
The Moscow Exchange is developing a comprehensive strategy to counter the sanctions, actively working with legal consultants and exploring all options to protect its interests and assets.
