As an art dealer, you are prohibited from carrying out a transaction with any person or entity on the national assets freeze register. As its name suggests, the aim of the asset freeze procedure is to prevent financial resources being made available to a person subject to international sanctions. The issue of asset freezing must therefore be an integral part of your risk analysis process.
Over the past year, the national register of frozen assets has been constantly expanded to include the names of Russian oligarchs and companies linked to them. So we need to be extra careful. The risk analysis required of art market professionals includes consultation of this register. Let's clarify this often misunderstood concept. The French assets freeze list incorporates the UN and European Union lists. Its main purpose is to identify individuals who have been designated as being involved in the financing of terrorism. Historically, these designations targeted Al Qaeda or the Taliban in Afghanistan. Russia's attack on Ukraine led to the adoption of 10 packages of sanctions in 12 months; to ensure that they were effective without delay, France chose to use this asset freeze mechanism. In this case, the decision to freeze assets is also accompanied by an embargo on a list of products including ‘luxury goods’ over 300 euros, which includes works of art, and the exclusion of Russian banks from the swift network, the international bank messaging system. If you're a regular reader, you'll already know that a vigilance protocol must be put in place whenever a customer purchases one or more works of art for more than €10,000. However, the assets freeze must be consulted for every transaction, regardless of the amount, from as little as €1. The LCB-FT requires a systematic check of the assets freeze on all your customers.
Generally speaking, we look for the seller or the buyer on the assets freeze list. If the sale is made through an intermediary, you will need to check that the intermediary's name does not appear on the assets freeze list.
You are free to consult the assets freeze register as it is public and available on the French government website. You can consult it by filtering the results displayed (by Id, Regime, Name, First name, Type of nature). To help you in this process, Eunomart has developed a function that enables you to carry out an automatic search on your customers. Once your customer has been identified (surname, first name, date of birth, country of tax residence, etc.), the software is able to determine whether or not you are dealing with a person listed in the register.
The penalties for non-compliance with the assets freeze are severe and cumulative:
- 5 years' imprisonment ,
- confiscation of the corpus delicti, the means of transport used, the goods and assets that are the direct or indirect product of the offence and,
- a fine equal to at least the amount of the offence and up to twice the amount of the offence.
