1. Purpose and Legal Framework

Law 150(I)/2025 establishes the National Sanctions Implementation Unit (NSIU) within the Ministry of Finance to ensure the effective application of:

• Restrictive measures of the EU (based on Article 215 TFEU),
• UN Security Council sanctions (under Chapter VII of the UN Charter),
• National Sanctions (see Part VI of the Law).

It responds to Cyprus's obligations under international and EU law to implement sanctions regimes in a structured and coordinated manner.

2. Definitions of Key Concepts (Article 2)

Understanding the definitions is essential to applying the law. Among the most critical terms:

• Sanctions: Encompass restrictive measures of the EU, national sanctions, and UN sanctions.
• Funds: Broadly defined to include cash, bank deposits, financial instruments (including shares, bonds, derivatives), guarantees, letters of credit, and crypto-assets (see point (η) under the definition of “funds” and Article 3(1)(5) of Regulation (EU) 2023/1114).
• Freezing of funds: Refers to the prohibition of any action, such as movement, transfer, alteration, use, or access, that could change the volume, amount, location, ownership, possession, nature, or purpose of funds, or otherwise make them available for use. This includes not only direct transactions but also indirect dealings, such as portfolio management or actions that could enable the funds to be utilised in any way.
• Designated persons/entities: Natural or legal persons subject to sanctions.
• Competent Authority: Any public body or authority with a legal mandate to enforce sanctions in its sector.
• Obliged entity: means the same as the term is defined in the The Prevention and Suppression of Money Laundering Activities Law.

3. Structure and Role of NSIU / EMEK (Articles 3–5)

NSIU is the central national authority for the enforcement and coordination of sanctions. Its key responsibilities include:

• Implementation & supervision of EU restrictive measures and UN sanctions,
• Coordination of all relevant state authorities and services,
• Processing of licensing and derogation requests related to sanctions,
• Exchange of information with both domestic and foreign authorities, including for strategic purposes,
• Issuance of guidance and directives to facilitate compliance,
• Monitoring, evaluating and reporting on implementation efforts and possible violations),
• Imposing administrative fines and maintaining necessary data records.

Internationally, ΕΜΕΚ is referred to as the National Sanctions Implementation Unit (NSIU).

4. Cooperation & Exchange of Information

The law emphasises mandatory cooperation between NSIU and:

• Supervisory and Competent Authorities – who must enforce sanctions within their legal domains (Art. 6).
• Other public authorities and MOKAS (the FIU) (Art. 13–16).

NSIU is empowered to:

• Request information from any entity or person (except where legal professional privilege applies) and impose fines of up to €100,000 for non-compliance (Art. 13).
• Access all national beneficial ownership registers and banking databases without notice to the entity concerned (Art. 18).

Key provision: Article 13(5) – Failure to provide requested information may result in substantial administrative fines.

5. Licensing, Derogations & Appeals

Under the NSIU Law, any person or entity seeking a licence or derogation in relation to economic sanctions - or any other sanctions for which the NSIU is designated as the competent authority - must follow a formal application process set out in the Law.

Submission of the Request – Article 9

Before any licence or exemption can be granted, the applicant must submit a written request to NSIU, clearly stating the legal basis for the request and enclosing all relevant supporting documents.

Applications must be submitted using the standard form issued by NSIU and may only be filed in Greek or English. NSIU has the authority to request additional clarifications or documentation during the evaluation process and may regulate the submission procedure in more detail through the issuance of official guidelines or instructions.

Assessment and Decision – Article 10

Once the request is submitted, NSIU assesses whether the conditions and criteria set out in the relevant EU legal instruments, UN Resolutions, or national sanctions framework are met. Where appropriate, NSIU may grant or deny the request, and it retains the discretion to attach conditions or limitations to any licence or derogation issued.

In accordance with the law, NSIU may issue either:

• Specific licences
• General licences

All decisions must be notified to the applicant. If the request is denied, the applicant is informed in writing, with reasons, and advised of their right to file a hierarchical appeal to the Minister of Finance under Article 12.

Right to Appeal (Article 12)

The NSIU Law provides applicants with a clear administrative remedy in the event that a licensing or derogation request is rejected, or where an existing licence is modified, suspended, or revoked. Under Article 12, affected parties have the right to file a hierarchical appeal before the Minister of Finance.

Filing an Appeal

The appeal must be submitted within 20 days of notification of NSIU’s decision. It must be in writing and include a concise explanation of the reasons for contesting the decision, supported by any relevant documents or arguments.

Examination of the Appeal

The Minister examines the appeal on its merits and, where deemed necessary or appropriate, may allow the applicant to present further representations or clarifications. Importantly, to ensure procedural fairness, the Minister may assign the review to senior officials who were not involved in the original decision.

Possible Outcomes

The Minister must issue a decision within 30 days of receiving the appeal. The options available include:

• Upholding NSIU’s original decision,
• Cancelling the decision entirely,
• Amending the decision, or
• Replacing it with a new decision.

Further Judicial Review

If the applicant remains dissatisfied, the decision of the Minister may be challenged before the Administrative Court, in accordance with Article 146 of the Constitution.

6. Reporting Obligations (Article 19)

Article 19 of the NSIU Law establishes reporting duties for individuals, companies, and institutions that become aware of assets connected to persons or entities subject to sanctions.

Any natural or legal person who becomes aware of funds or economic resources located within the European Union, which are owned, held, or controlled by a designated individual or entity but have not been frozen as required, must report this to NSIU within two weeks of becoming aware of the information. Similarly, if any such assets were moved, transferred, altered, accessed, or otherwise dealt with during the two weeks immediately prior to the imposition of sanctions, this too must be reported. In both cases, the reporting party is also required to cooperate with NSIU in the verification and assessment of the relevant information.

Designated individuals or entities themselves have a further obligation to self-report within 6 weeks of being listed.

Importantly, the Law expressly protects legal professional privilege. Lawyers acting in the course of their profession are not required to report information that is covered by attorney–client confidentiality. This ensures that the duty to report does not compromise fundamental rights relating to legal representation and confidentiality.

In substance, Article 19 reinforces NSIU’s role as the central national point for monitoring the implementation of sanctions and places time-sensitive duties on both public and private actors to disclose relevant financial information.

7. Administrative Fines (Articles 28 to 30)

Articles 28 to 30 of the NSIU Law set out the framework for administrative sanctions, including the imposition of administrative fines by NSIU, and the mechanisms available to affected persons to challenge such decisions through administrative recourse.

Article 30 establishes the right of a person who is potentially subject to an administrative fine by NSIU to a prior hearing before the decision is finalised. Specifically, before imposing a fine, NSIU must inform the affected individual or entity of their rights and provide a clear opportunity to respond. The person has the right to submit written representations within a time frame set by NSIU, which may range from three (3) to twenty-one (21) days following notification. NSIU is legally required to consider these representations before reaching a final decision on whether a violation occurred, whether a fine should be imposed, and, if so, the amount.

Importantly, Article 30(6) expressly provides that the issuance of an administrative fine by NSIU can be the subject of a recourse before the Administrative Court.

8. Concluding Remarks

The National Sanctions Implementation Unit Law (Law 150(I)/2025) represents a significant development in the Republic of Cyprus’s legal and institutional framework for the implementation of international sanctions. It introduces a structured and centralised mechanism through the establishment of ΕΜΕΚ (NSIU) and reflects a policy shift from fragmented enforcement to coordinated application. NSIU is empowered not only to implement sanctions but also to act as a gatekeeper for licensing, oversight, and guidance in all matters related to economic sanctions and restrictive measures.

It must be emphasised that the information provided above is not exhaustive. The law contains additional obligations not analysed in this guide, including provisions on criminal offences, further reporting duties, data protection compliance, and detailed procedures for cooperation with both domestic and international authorities. Certain breaches of the sanctions regime may give rise not only to administrative penalties but also to criminal liability, particularly in cases of intentional non-compliance or circumvention.

Given the complexity involved in the practical application of the sanctions framework, legal advice should be sought on a case-by-case basis. Tailored guidance is especially important when considering whether a licence or derogation may be required, assessing potential exposure to enforcement action, or clarifying reporting obligations. The evolving nature of EU and UN sanctions frameworks also makes ongoing legal monitoring essential for ensuring continued compliance.