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December 7, 2018

Pakistan told to freeze funds of proscribed outfits, individuals


December 7, 2018

ISLAMABAD: The Asia Pacific Group (APG), a regional body of FATF, has asked Ministry of Foreign Affairs to demonstrate comprehensive legal obligations to implement condition of asset freezing and prohibitions to provide funds and financial services for UN proscribed militant outfits and affiliated individuals without any delay.

The APG also asked Pakistan for providing details of the enforcement power given in the Anti-Terrorism Act (ATA) in respect of sanctions as well as any other enforcement tools available to ensure that there are adequate penalties for non-compliance.

The progress on these actions will be reviewed in upcoming plenary meeting of FATF scheduled to be held in first week of January 2019 in Australia. The timeline for implementing these conditions were given to Pakistan till May 2019.

Official documents as well as top official sources told The News on Thursday that Ministry of Foreign Affairs in its written reply told the APG mission that the ATA (amended) Ordinance 2018 got expired on June 7, 2018. Prior to its expiry, the government tabled a bill for making the ordinance a permanent part of the act. However, as the National Assembly (NA) had dissolved on May 31, 2018 (before the last elections) so the bill could not be approved by the parliament. Now the bill would be taken up again into the Parliament. However, the government could not make any progress on it so far, said the sources.

The APG asks Pakistan for providing evidence of its legal basis to implement targeted financial sanctions without delay including setting out the specific parts of UN Security Council Act which demonstrates compliance with recommendation 6, providing a copy of freezing order implemented in terms of SRO under the UN Act to give effect to legal obligations under UNSCR (United Nations Security Council Resolution) 1267 and details of assets after lapse of Anti-Terrorism Act (ATA) ordinance.

“Pakistan will have to provide evidence to show that they have adequate resources to implement their targeted financial sanctions,” the APG said and sought budget related details to ensure adequate resources for delivering on this condition. Islamabad is bound to show evidence of how it ensures that funds of designated persons and entities have been frozen by financial institutions and others. Pakistan needs to set out how the Lahore High Court interim order on ATA amendment fits with technical compliance action item when a final order from LHC will come and what the government’s plan if the court rules against the government again.

The Ministry of Foreign Affairs told the APG team in last October deliberations that the legal obligation to implement Recommendation-6 targeted financial sanction are undertaken through UN Security Council (Pakistan) Act 1948.

Under this act, Ministry of Foreign Affairs issues SRO whenever change is made by UN sanction Committee in the consolidated list of individuals and entities. In particular, the SROs are issued the same day on which the communication is received from Sanction Committee. The language of SROs is adequate to cover both freezing of assets and ongoing prohibitions to provide funds and financial services.

Ministry of Foreign Affairs informed the APG that the language of SROs reads out “Freeze without delay the funds and other financial assets or economic resources of these individuals, groups, undertakings and entities including funds derived from property owned or controlled directly or indirectly by them or by persons acting on their behalf or their direction and to ensure that neither these nor any other funds, financial assets or economic resources are made available directly or indirectly for such persons benefit by their nationals or by persons or by persons within their territory and no person shall make donations to individuals and entities designated by the Committee on those acting on behalf of or at the direction of the designated entities”.

The Ministry further explains that there might be some confusions because the country’s technical compliance with respect to implementation regime without ATA ordinance operational as it was already assessed and approved by FATF in 2015.

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