Rules for the Implementation of Targeted Financial Sanctions

Without prejudice to the provisions of relevant laws, regulations, and instructions, including the Law on Combating the Financing of Terrorism , its Implementing Regulations , and SAMA’s Circular regarding compliance with measures to combat the financing of proliferation (No. 473014504) dated 16/4/1447H.; The Financial Institution shall conduct a comprehensive and documented assessment of the risks of terrorism and its financing and the risks of financing the proliferation of weapons of mass destruction, and shall periodically and continuously develop its practical understanding of those risks and their typologies through multiple aspects of risk, including factors related to its customers, other countries, geographical areas, products, services, transactions, and delivery channels. 2.2 A Financial Institution shall adopt a risk-based approach in developing and implementing the policies, procedures, and internal controls related to Targeted Financial Sanctions, commensurate with the nature of its activities, the scale of its operations, and its level of exposure to risks, and shall periodically and continuously verify its technical and operational readiness to implement all of its obligations set out in the Rules. 2.3 The Financial Institution's compliance and anti-money laundering and counter-terrorist financing framework shall include a comprehensive program for compliance with Targeted Financial Sanctions, commensurate with the nature of its activities, the scale of its operations, and its level of exposure to risks. This shall include appointing a competent officer, and ensuring effective coordination and cooperation among the relevant administrative units, overcoming any consequences or challenges that may affect the Financial Institution's obligations set out in the Rules. The board of directors or senior management, as the case may be, shall bear ultimate responsibility for the efficiency and effectiveness of that program and shall provide the necessary support and resources for its implementation. 2.4 The Financial Institution shall establish written policies, procedures, and controls approved by the board of directors or senior management, as the case may be, to implement the obligations set forth in the Rules, which shall be brought into effect through procedures and controls related to their implementation within the Financial Institution. These policies and procedures shall be clearly written and implemented across all sectors and business lines of the Financial Institution to ensure their effective application. They shall be reviewed and updated periodically to keep pace with any relevant developments or instructions, and the following items shall be taken into account in their preparation: a. Procedures and controls for screening against sanctions lists. b. Management and updating of sanctions lists through official channels and websites. c. Procedures for freezing funds. d. Procedures for lifting the freeze. e. Record keeping. f. Training and awareness. g. Measures established to maintain confidentiality. h. Measures adopted to protect whistleblowers. 2.5 The Financial Institution shall submit regular periodic reports to the board of directors or senior management, as the case may be, on the extent of its compliance with the Rules and instructions related to Targeted Financial Sanctions. The reports shall include the results of supervisory observations and internal reviews, including those related to non-compliance, the corrective measures taken, and the resulting outcomes.