Introduction: The Reserve Bank of India (RBI) has issued a crucial directive, referenced as RBI/2023-24/109, regarding the implementation of Section 12A of the Weapons of Mass Destruction (WMD) and their Delivery Systems (Prohibition of Unlawful Activities) Act, 2005. This communication, dated January 06, 2024, addresses the Chairpersons/CEOs of all Regulated Entities, emphasizing the significance of compliance with the amended Master Direction on Know Your Customer (MD on KYC).
Detailed Analysis:
1. Compliance with Section 12A: The article delves into the requirements stipulated in Section 52 of the MD on KYC, necessitating Regulated Entities (REs) to meticulously adhere to the “Procedure for Implementation of Section 12A of the WMD Act, 2005.” This procedure, outlined in Annex III of the MD on KYC, was established by the Ministry of Finance, Government of India, through an order dated September 01, 2023.
2. Verification of UNSCR 1718 Sanctions List: Section 53 of the MD on KYC mandates REs to daily verify the ‘UNSCR 1718 Sanctions List of Designated Individuals and Entities.’ The article emphasizes the need to stay updated on modifications to the list and comply with the ‘Implementation of Security Council Resolution on Democratic People’s Republic of Korea Order, 2017.’
3. Consolidated List and Amendments: The article references circular DOR.AML.REC.23/14.06.001/2023-24, which communicated the Consolidated List of UNSC Designated/Sanctioned Individuals and Entities. Amendments to the list were notified through subsequent circulars, highlighting the dynamic nature of regulatory requirements.
4. MEA Notification and Amendments: The Ministry of External Affairs (MEA), Government of India, has informed about amendments made by the UNSC Committee to the Sanctions List. Entries with strikethrough and/or underline indicate modifications. The article emphasizes the importance of aligning with these changes for effective compliance.
5. Access to UNSC Sanctions Lists: Providing practical information, the article directs readers to the UN Security Council’s website for the latest version of the UNSC Sanctions lists on Democratic People’s Republic of Korea (DPRK).
Conclusion: In conclusion, the article reiterates the advice from RBI, urging Regulated Entities to carefully consider the communicated directives and ensure meticulous compliance. The ever-evolving landscape of international sanctions and regulatory requirements necessitates a proactive approach from financial entities to safeguard against potential risks and legal implications.
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Reserve Bank of India
RBI/2023-24/109
DOR.AML.REC.67/1 4.06.001/2023-24 Dated: January 06, 2024
The Chairpersons/ CEOs of all the Regulated Entities
Madam/Dear Sir,
Implementation of Section 12A of the Weapons of Mass Destruction and their Delivery Systems (Prohibition of Unlawful Activities) Act, 2005: Designated List (Amendments)
Please refer to Section 52 of our Master Direction on Know Your Customer dated February 25, 2016 as amended on January 04, 2024 (MD on KYC), in terms of which, inter alia “Regulated Entities (REs) shall ensure meticulous compliance with the “Procedure for Implementation of Section 12A of the Weapons of Mass Destruction (WMD) and their Delivery Systems (Prohibition of Unlawful Activities) Act, 2005” laid down in terms of Section 12A of the WMD Act, 2005 vide Order dated September 01, 2023, by the Ministry of Finance, Government of India (Annex III of the Master Direction on Know Your Customer).”
2. Further, in terms of Section 53 of our MD on KYC, “the REs shall verify every day, the ‘UNSCR 1718 Sanctions List of Designated Individuals and Entities’, as available at https://www.mea.gov.in/Implementation-of-UNSC-Sanctions-DPRK.htm, to take into account any modifications to the list in terms of additions, deletions or other changes and also ensure compliance with the ‘Implementation of Security Council Resolution on Democratic People’s Republic of Korea Order, 2017’, as amended from time to time by the Central Government”.
3. A reference is also invited to our circular DOR.AML.REC.23/14.06.001/2023-24 dated July 04, 2023, communicating thereby the Consolidated List of UNSC Designated / Sanctioned Individuals and Entities under the UNSC Resolutions relating to non Certain amendments to the entries in the List were notified vide our circulars DOR. AML.REC.24/14.06.001/2023-24 dated July 04, 2023 and DOR. AM L. REC.33/1 4.06.001/2023-24 dated August 18, 2023, respectively.
4. In this regard, Ministry of External Affairs (MEA), GoI has informed that the UNSC Committee established pursuant to resolution 1718(2006) has enacted the amendments, specified with strikethrough and/or underline in certain entries on its Sanctions List of individuals and entities (enclosed with this circular). Hence, the ‘designated list’ as referred in Para 2.1 and other relevant paras of the aforementioned Order dated September 01, 2023 is amended in accordance with the changes in these relevant
5. The latest version of the UNSC Sanctions lists on DPRK is accessible on the UN Security Council’s website at the following URLs:
https://www.un.org/securitycouncil/sanctions/1718/materials
6. The REs are advised to take note of the aforementioned communications and ensure meticulous compliance.
Yours faithfully,
(Saidutta Sangram Keshari Pradhan)
General Manager
Encl: As above
