By Stefanos Evripidou
FOREIGN Minister Ioannis Kasoulides said yesterday there was suspicion that one or two of the 18 Ukrainians targeted by the EU with sanctions for embezzlement of public funds could have assets in Cyprus.
Kasoulides said a meeting was held at the ministry yesterday with the relevant authorities, including the Central Bank and Unit for Combating Money Laundering (MOKAS), to determine whether Cyprus needed to take action and freeze the assets of any of the 18 singled out on suspicion of embezzlement of Ukrainian state funds.
The EU Council decided earlier this week to proceed with an immediate freezing of funds and economic resources of 18 prominent figures in the old guard of the Ukrainian leadership identified as responsible for the misappropriation of Ukrainian state funds and their illegal transfer outside Ukraine.
The decision came into effect as of March 6, 2014. The list of 18 has been made public in the Official Journal of the EU under Council Regulation (EU) No 208/2014, and can be found online.
It includes former Ukrainian President Victor Yanukovych and his two sons, former Prime Minister Mykola Azarov and his son, the former Prosecutor General and his son, four former ministers, and the former head of the Security Service.
Article 2 of the Regulation states that all funds and economic resources belonging to, owned, held or controlled by any natural or legal person, entity or body listed in Annex I of the document shall be frozen.
Asked yesterday if any of the 18 persons identified were related to Cyprus in any way, Kasoulides said there were possibly one or two cases connected to Cyprus.
“If there are any such cases… we are obliged to comply with the EU decision. In any case, we should be the last ones to be blamed for receiving stolen items. But any step requires court proceedings. It cannot be an arbitrary act,” he said.
A statement released after yesterday’s meeting at the foreign ministry said the relevant departments and authorities of Cyprus were “in full coordination, taking all appropriate actions and making all necessary checks to ensure compliance” with the EU decision.
The foreign minister highlighted that for Cyprus, the official government of Ukraine was the temporary one currently in place in Kiev.
“It is not for us to judge its constitutionality. Our hope is not to have a fait accompli in Crimea which will have consequences on the territorial integrity and sovereignty of Ukraine.
“As a country which has also suffered an attack on its own territorial integrity, we cannot support this.”
He added that Cyprus was sticking to the joint decisions of the EU on the Ukrainian crisis while keeping a low profile.
European leaders also announced on Thursday plans to suspend visa talks with Moscow and EU attendance to the G8 Summit in Sochi. A second phase of sanctions could include travel bans and a freeze of Russian assets if Moscow failed to sit at the negotiating table with the Ukrainians.
Kasoulides sought to allay fears that Russian tourism to Cyprus would be affected, drawing a distinction between the phased sanctions on Russia and the targeted sanctions on Ukrainian individuals connected to the Yanukovych regime, who are reasonably suspected of embezzlement of public money, “which belongs to Ukraine’s citizens and must be returned”.
Regarding the visa talks between the EU and Russia, the aim is to eventually abolish visa requirements on both sides.
“The measure taken by the EU is to freeze this dialogue (with Russia). It does not change anything regarding the existing situation, where through a certain mechanism, Russian visitors can receive visas and come to Cyprus. There is no issue of prohibiting or cutting economic relations between EU countries and Russia,” he said.
Cyprus enjoys historically close political and economic ties with Russia, seen by the EU and US as the aggressor in the Ukraine crisis. Russia has often acted as a bulwark in the UN Security Council against Anglo-American moves seen in the past as unfriendly towards the Cypriot government.
Since the election of President Nicos Anastasiades, there has been an evident shift in Cyprus’ foreign policy to the West, with the government’s stated intention being membership of NATO’s Partnership for Peace programme (PfP).
Until now, this was not seen as a zero sum game for Russia, also a PfP member. The former Soviet Union member still enjoys close economic ties with Cyprus and makes use of the island’s ports and airports occasionally for military purposes.
However, the manner in which Russian forces took over Ukrainian bases and effectively shut out the central government from the Crimea, citing the need to protect Russian-speaking citizens of the area smacked too much of the pretext given by Turkey in 1974 to invade and occupy the island’s northern third.
After signing up to a joint EU statement condemning Russia’s actions, Cyprus came out on March 4 stating clearly its support for Ukraine’s territorial integrity and sovereignty.
Meanwhile, international offshore law firm Harneys released a statement yesterday saying it will host a live webcast on Tuesday, March 11, at 4 pm local time, during which a panel of experts will provide legal analysis of the latest developments concerning economic and other sanctions against Ukraine and Russia, with particular focus on how such sanctions could impact business interests in Cyprus and the British Virgin Islands (BVI).
The panel will be hosted by the firm’s chairman, Peter Tarn who said: “Harneys is closely monitoring the evolving situation in Ukraine and Russia. With BVI and Cyprus providing the most popular corporate structures for investments involving Russia and the West, the imposition of sanctions could have significant impact on a wide range of business interests.”
For more information about Tuesday’s webcast and to register, visit the Harneys website: http://www.harneys.com/publications/webinars/ukraine-russia-and-the-impacts-of-sanctions-on-ifcs
