The European Parliament made a decision on Tuesday to enforce stricter regulations aimed at cracking down on violations of sanctions, with a particular focus on the crypto industry. The legislation garnered strong support, with 543 votes in favor, 45 against, and 27 abstentions from EU member states.
The move comes in response to Russia’s military actions in Ukraine, which raised concerns about potential breaches of the EU’s financial sanctions against Russia. Sophie in ‘t Veld, a Dutch parliament member leading the legislation, highlighted the need for standardized rules to address disparities in national enforcement, which can create vulnerabilities and loopholes. The goal of the bill is to create a uniform approach to confiscating frozen assets.
Currently, while the EU sets sanctions collectively, individual member states are responsible for enforcement, leading to inconsistencies in defining violations and the corresponding penalties. The new measures cover a wide range of financial services, including transactions involving cryptocurrencies and digital wallets, and establish clear definitions for violations such as failing to freeze funds, disregarding travel bans or arms embargoes, transferring funds to sanctioned individuals, or engaging with state-owned enterprises of sanctioned countries.
Before the legislation can become law, it must be approved by the council, composed of senior government officials from the member states. This new development marks a significant step towards enhancing the enforcement of sanctions within the EU.