Sanctions compliance using Globas: Top 5 questions about counterparty check
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Modern business is constantly exposed to global financial and political risks, which can have a serious impact on its operating activities. In a dynamic geopolitical environment, sanctions are becoming an integral part of international relations. The practice of their use continues to develop, countries are introducing counter-sanction measures, creating a complex network of restrictive measures. For businesses, this means the need of sanctions compliance and regular monitoring of counterparties.
To fully understand the situation, it is necessary to study many documents, the regulatory measures of different countries and organizations, and also understand the importance of sanctions checks and potential threats.
Information Agency Credinform answers Top 5 questions about the sanctions screening.

1. Who should check their counterparties for sanctions?

The question of who should be responsible for sanctions screening is relevant for all companies, especially for those engaged in the international trade, foreign economic activity and financial transactions. These are banks, financial institutions, exporting and importing companies, participants in global supply chains, as well as branches of foreign companies.

2. Why it is necessary to screen counterparties for sanctions?

Such check is not only a legal requirement, but also a necessity to reduce risks. Violation of sanctions can lead to serious consequences, including fines, loss of reputation, and sometimes criminal liability.
The need to comply with sanctions measures of the UN Security Council and special economic measures (SEM) of Russia is enshrined at the legislative level in the Russian Federation. The Federal Law No. 422-FZ dated August 4, 2023 created a set of tools for sanctions regulation, established liability measures for legal entities, introduced the concept of a “blocked person,” etc.

3. Where to find a unified database of sanctions lists from all over the world?

Unfortunately, there is no single database containing information about sanctions lists from all over the world. Sanctions data is distributed across various sources. Within the same country, restrictions may be set by different authorities, and information about them may be presented in different formats. Information and Analytical system Globas is a resource that brings together various sources of information on global sanctions and tracks list updates in real time. Sanctions Compliance, a module of Globas, provides opportunities for comprehensive check of counterparties for sanctions and risk assessment, including reconciliation with the consolidated register of restrictive measures adopted by various countries and organizations.

4. What are the consequences of refusing to check counterparties for sanctions?

Failure to undergo a sanctions check can lead to serious consequences for the company. Firstly, this threatens financial losses in the form of fines, secondary sanctions and other restrictions. Secondly, this can negatively affect the company’s reputation and lead to loss of trust from clients and partners. Moreover, violation of sanctions may cause a risk of criminal liability for company management.

5. How to facilitate the process of checking counterparties for sanctions risks?

Automation of sanctions check of counterparties can significantly simplify and speed up this process. The use of specialized software solutions, such as Sanctions Compliance in Globas, makes it possible to automate the monitoring of sanctions lists, receive notifications of new sanctions and adapt risk strategies to the specific needs of the company.
Sanctions Compliance in Globas contains detailed information on sanctions and restrictions, including the 50 Percent Rule, as well as additional sources and more in-depth analysis of companies, persons and objects that are subject to restrictions.
Compliance with sanctions is not only a legal requirement, but also a strategic necessity for business in today's globalized world. Proper verification of counterparties for sanctions helps reduce risks and ensure the stability of the company’s operations. With specialized instruments such as Sanctions Compliance in Globas, this process becomes more efficient and transparent.


Sanctions Compliance

Sanctions Compliance provides an opportunity to check Russian and foreign companies, persons, water and air transport. Persons associated with companies are also checked: beneficiaries, owners, managers, affiliates and subsidiaries. The module contains extensive information about the imposed sanctions and restrictions, including the 50 Percent Rule, additional sources and deeper analytics on companies, persons and objects that have fallen under restrictions and in various risk registries.

Assessing the risks of cooperation with foreign companies using Globas
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In today's world of globalization and rapidly changing business conditions, as well as under the occurrence of new markets and areas of international entrepreneurship, the Russian legal entities are increasingly entering into business relationships with foreign companies. To minimize risks and ensure the security of business, it is extremely important to conduct thorough check of potential international partners.
Entering into transaction with an unfair partner could cause serious risks for the external economic activity of one's company, creating losses and adversely affecting the company's reputation. This is especially undesirable in the frames of developing new international markets.

Due diligence

The principle of compliance with due diligence standards is firmly embedded in the corporate compliance policies of most Russian companies. However, on the background of the current geopolitical changes, when Russian companies are increasingly turning to new markets, including in the East, it is necessary to pay attention to other aspects of checking the counterparties in the frames of international business.
Conducting foreign economic activity under the conditions of global sanctions, commodity restrictions and the organization of parallel imports impose an additional burden on business. A thorough examination of international contracts, preparation of documents and reporting for currency control, as well as compliance with the requirements of the legislation of the Russian Federation, in particular No. 115-FZ, is required.
Let's examine the key aspects that should be taken into account when checking foreign companies:
1. Legal status of a company
The first step is to check the legal status of the foreign company. This includes finding out registration details such as official company name, principle address, registration number, date of establishment, etc. Checking this data will help ensure that the company operates in accordance with the laws of its country.
2. Financial condition
Assessing the financial condition of a foreign company plays an important role when deciding on cooperation. This includes analysis of financial, accounting, tax reports and other financial documents. This information allows to assess the stability and financial strength of a potential partner.
3. Reputation and history
Researching the reputation and history of a foreign company is also important to assess its reliability and proper fulfillment of obligations. Checking for negative news, litigation, fines or other incidents will help identify potential risks.
4. Legal and regulatory compliance
Russian legal entities need to ensure that the foreign company complies with local laws and regulations. This includes verifying the availability of all necessary licenses, certificates and permits to operate the business.
5. Corporate structure and management
Examination of the corporate structure and management system of a foreign company helps to understand its internal processes and decision-making mechanisms. It can also help to determine how transparent and effective internal management processes are.
6. Sanctions lists and negative registers screening
Another important aspect of checking a foreign partner is the implementation of sanctions compliance procedures and checking the presence of the partner and related persons in negative registers.

Using the Sanctions Compliance module in the Information and Analytical system Globas you can check against all global lists of sanctions, restrictions, negative registers, including those imposed by Russia and the UN Security Council, which must be followed by all legal entities of the Russian Federation and lists which must be checked within the framework of 115-FZ Federal Law.

Automation and minimization of risks of cooperation with foreign companies

Thorough check helps reduce risks and ensure successful interaction with foreign partners. At the same time, it is important to use both own resources and the services of professional information agencies for checking companies in order to obtain all the necessary information and ensure the security of your business, as well as reduce time for checking the counterparty.

Credinform and its product Globas will help you solve the problems of due diligence when checking international business partners. Credinform is a leading provider of economic information on companies from around the world.

In Globas, you can obtain online information about companies from Belarus, Kazakhstan, Kyrgyzstan, Latvia, Moldova, Tajikistan, as well as generate report on 450 million companies from Europe, America, Africa and the Asia-Pacific region. The report will contain data on financial statements, history, shareholders and beneficial owners.

You can order an offline report for more detailed and comprehensive check of a foreign partner. Your request will be processed by a team of professional experts with extensive experience and specialization in this field. You will receive comprehensive information, including registration data, financial statements, ownership structure taking into account international connections, expert opinion, as well as verification of connections and affiliations with Russian companies.

Due to an extensive network of partners, Credinform provides information on legal entities and entrepreneurs around the world, including Europe, Asia, America, Africa and Australia. The reports are provided in Russian and contain only reliable information obtained from reliable sources. Their content complies with international standards, including information on registration, management, shareholders, types of activities, balance sheet, profit and loss account, as well as a comprehensive assessment of solvency. For each foreign company, the experts of the Credinform Information Department also conduct an additional search for connections with Russian business.


Credit reports on foreign companies

Thanks to a wide network of partners, Credinform provides information about legal entities and entrepreneurs around the world on all continents: from multinational corporations to offshore companies and individual entrepreneurs. To verify the solvency of the company, to identify the owners or to check the fact of registration in an offshore zone – our experts will provide comprehensive information and a competent resume.