Legal Effects of Economic Sanctions on International Payments
Speaker: Dr Burcu Yüksel
Economic sanctions can be described as measures that are imposed by a State or by an international organisation on a unilateral or multilateral basis, such as the sanctions imposed by the United States or by the United Nations, in order to sanction a particular State or to persuade it to behave (or not to behave) in a particular way. In this regard, they are legal measures that mainly serve political goals (including security issues) and constitute a typical example of what private international law regards as mandatory rules. As long as the sanctions are in force, they require a complete or partial interruption of economic relations with the targeted state(s) and also with their nationals. This generally includes a prohibition on transfers or transactions involving these parties and requires the freezing of their funds on the respective bank accounts. All the banks located in the sanction imposing state must comply with the economic sanctions. This has certain effects on international payments and also on the underlying relationships between the parties of the payment transactions. Legal problems relating to sanctions mostly arise in the context of unilateral sanctions having extraterritorial effect. In that case, in addition to the banks located in the sanction imposing state, their foreign branches are also required to comply with these sanctions. Particular difficulties arise if the foreign branch is located in a state which is not bound by the economic sanction in question. This gives rise to one of the most problematic issues in the areas of payments law and private international law which will be discussed in this presentation by considering some relevant examples.
Hosted by: School of Law
Venue: New King’s NK11