The EU has updated its FAQs relating to the sanctions against Russia and Belarus, with the addition of a new question which focuses on Article 5n of Council Regulation (EU) No 833/2014.
Article 5n(1) of EU Regulation 833/2014 reads as follows:
- It shall be prohibited to provide, directly or indirectly, accounting, auditing, including statutory audit, bookkeeping or tax consulting services, or business and management consulting or public relations services to:
- the Government of Russia; or
- legal persons, entities or bodies established in Russia.
Based on the above article, the following FAQ has been inserted:
Question: Does the prohibition to provide auditing services in Article 5n(1) of Council Regulation (EU) 833/2014 prohibit the auditing of information of legal persons, entities or bodies established in Russia for the purposes of consolidated financial reporting of legal persons, entities or bodies established in the Union, as required by international auditing standards?
Answer: It is prohibited to provide, directly or indirectly, auditing, including statutory audit, services to the Government of Russia or legal persons, entities or bodies established in Russia.
Auditing services carried out by operators on information required for the purposes of consolidated financial reporting of a group which is controlled by a legal person, entity or body which is incorporated or constituted under the law of a Member State (e.g. to comply with international auditing standards and requirements) is in principle not prohibited by Article 5n(1) of Council Regulation (EU) 833/2014, in as far as the services are provided to and for the benefit of the EU parent company.
Article 12 prohibits the participation, knowingly and intentionally, in activities the object or effect of which is to circumvent prohibitions in this Regulation.
The consolidated FAQs may be accessed here.
For further information or advice, please contact info@compliancemk.com.
