Targeted financial sanctions, such as those imposed in response to Russia’s invasion of Ukraine, impose restrictions on dealing with the assets of designated persons or entities (the requirement to freeze assets).
The responsibility to freeze an asset subject to targeted financial sanctions rests with the person or entity that holds the asset, such as a financial institution.
This article explores what you can do if you believe your assets have been wrongly frozen, as outlined by DFAT.
What should I do if I believe my asset has been wrongly frozen?
In the first instance, you should contact the asset holder. If the issue cannot be resolved, you should email the Australian Sanctions Office (ASO) at [email protected] and provide the following information:
- Your full name and contact details.
- The details of the asset and asset holder, including details of your legal or other interest in the asset.
- Details of your contact with the asset holder.
- The reasons for your belief that the asset has been frozen in error.
Compensation for wrongly frozen assets
If you have suffered a loss resulting from a wrongly frozen asset, you may be entitled to compensation as set out in section 25 of the Charter of the United Nations Act 1945.
To be eligible for compensation, all of the following criteria must be met:
- You (the owner or controller of the asset) must instruct the person holding the asset to use or deal with it.
- The holder must refuse to comply with your instructions in good faith and without negligence in order to comply with relevant sanctions law.
- The asset must not be a freezable asset under the law.
- You must have suffered a loss as a result of the refusal.
An asset holder is not liable for any loss resulting from a wrongly frozen asset if they acted in good faith and without negligence to freeze an asset in compliance with relevant sanctions laws.
How do I make a claim for compensation?
Claims for compensation can be made to the ASO via the email address listed above. To make a claim, you must provide a Statutory Declaration with all relevant information, including evidence:
- Of the name, contact details and, where relevant, Australian Business Number of the asset owner, controller and holder;
- Of the basis under which the asset holder held the asset on behalf of the asset owner or controller.
- That the owner or controller was the owner or controller of the asset in question at all relevant times, or as the case may be.
- That the asset was held by the asset holder at all relevant times, or as the case may be.
- Of the relevant instruction(s) to the asset holder to use or deal with the asset.
- That the asset holder refused to comply with those instructions.
- That the refusal was in good faith, and without negligence, in purported compliance with the Act.
- That the asset was not a freezable asset.
- That a loss was suffered by the asset owner as a result of the refusal of the asset holder to comply with the relevant instructions.
- Of the amount of the loss suffered, including details of the loss and the method of calculation.
Claims should be accompanied by consent to contact the relevant asset holder or controller for confirmation of the circumstances of the claim.