The Society of Trust and Estate Practitioners (STEP) has issued industry recommendations focused on assets with Russian connection.
The recommendations called the Position Paper: EU Sanctions against trusts with a ‘Russian connection’ clarifies to the practitioners practical issues related to the changing situation.
STEP recommends to its members inter alia to become aware of the sanctions, published sanctions lists, and to fully understand the origin of any assets under the ownership and control of their clients.
The document also discusses some peculiarities found in the EC Regulation 2022/576 forbidding provision of trust services to Russians within the EU. In particular, recommendations provide some views on the scope of services to which the EU restrictions apply. For instance, STEP concluded that the current restrictions shall be applicable to the following arrangements along with the trusts:
a. Private foundations incorporated in an EU Member State.
b. Nominee agreements governed by the laws of a Member State or where the nominee is a national or a resident of a EU Member State (in some cases such nominee agreements may be organised as ‘bare trusts’).
c. Escrow agreements where one of the parties is a Russian national or resident or any other entity mentioned under article 5m (1) of Regulation 2022/576.
The recommendations clarifies some issues related to the prohibited services and provide guidelines for the trustees on resignation from the trust and possible implications that might arise in connection with this.
The full text of the STEP Position Paper can be found here.
Previously it was informed that the European Commission has forbidden provision of trust related services for Russian citizens.