Singapore imposes sanctions on 4 Russian banks; export of certain goods also banned

[SINGAPORE] Banks and other financial institutions here will be banned from doing business with 4 Russian banks, as part of sanctions the Republic is imposing to hit the Russian economy for the invasion of Ukraine.

The sanctions will also involve a ban on the export of certain goods to Russia, including electronics, computers and military goods, said the Ministry of Foreign Affairs (MFA), which gave more details on these sanctions on Saturday (Mar 5) for the first time since they were announced on Monday.

"These sanctions and restrictions aim to constrain Russia's capacity to conduct war against Ukraine and undermine its sovereignty," said MFA.

Russia invaded neighbouring Ukraine on Feb 24 after months of tension at the border, with Russian troops massing and conducting military exercises. Its actions have been widely condemned by countries around the world, including Singapore, which announced on Monday that it would be imposing the sanctions.

MFA said that the financial institutions here will be prohibited from entering into transactions or establishing business relationships with 4 Russian banks:

• VTB Bank Public Joint Stock Company
• The Corporation Bank for Development and Foreign Economic Affairs Vnesheconombank
• Promsvyazbank Public Joint Stock Company
• Bank Rossiya

"Where there are existing business relationships, financial institutions must freeze any assets and funds of these 4 banks," said MFA.

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The ministry added that digital payment token service providers are specifically prohibited from facilitating transactions that could help to circumvent these financial measures.

Transactions and providing financial services that facilitate fund raising to the Russian government and the Central Bank of the Russian Federation, as well as any entity owned or controlled by them or acting on their direction or behalf, will be prohibited.

MFA said that these prohibitions apply to buying and selling new securities, providing financial services that facilitate new fund raising by, and making or participate in the making of any new loan to the above entities.

"The Singapore government and Monetary Authority of Singapore will also cease investing in newly issued securities of the above entities," MFA said.

Banks, insurers and other financial institutions here will additionally not be allowed to do business with certain sectors in the breakaway regions of Donetsk and Luhansk of Ukraine. The sectors are transport, telecommunications, energy and prospecting, and the exploration and production of oil, gas and mineral resources.

The banned transactions involving Russia will also apply to cryptocurrencies, and MFA said that Singapore's sanctions cover all transactions that involve cryptocurrencies and extend to the payment and settlement of transactions that relate to digital assets, such as non-fungible tokens.

Following the detailed stance by MFA, GIC issued a statement saying it "continues to assess the Russian-Ukrainian situation and will ensure compliance with all applicable laws and regulations."  

Separately, the ban on the transfer of goods to Russia will involve all items in Singapore's Military Goods List and all items in the "Electronics", "Computers", and "Telecommunications and Information Security" categories of the Dual-Use Goods List of the Strategic Goods (Control) Order 2021.

These items will not be allowed to be exported to Russia because they can be used as weapons to inflict harm on or to subjugate the Ukrainians, as well as items that can contribute to offensive cyber operations.

Last year, Singapore’s trade in goods with Russia was S$5 billion, said the Ministry of Trade and Industry. Its top exports to Russia are in electronics and apparatus.

Russia's invasion of Ukraine contravenes the United Nations Charter and is a clear and gross violation of international law, said MFA.

It highlighted how the sovereignty, political independence, and territorial integrity of all countries must be respected, and that Singapore takes any violation of these core principles seriously, as they are fundamental to the survival of the country, which is a small state.

"While we continue to value good relations with Russia and the Russian people, we cannot accept the Russian government's violation of the sovereignty and territorial integrity of another sovereign state.

"For a small state like Singapore, this is not a theoretical principle, but a dangerous precedent. This is why Singapore has strongly condemned Russia's unprovoked attack on Ukraine."

THE STRAITS TIMES