28 Feb 2022

Government facing pressure to freeze assets of Russian oligarchs

6:43 pm on 28 February 2022

The government is being urged to freeze the assets of Russian oligarchs to try to pressure them into opposing their government's invasion of Ukraine.

PM Jacinda Ardern speaks to media following Russia's invasion of Ukraine

PM Jacinda Ardern speaks to media following Russia's invasion of Ukraine. Photo: RNZ / Angus Dreaver

The Autonomous Sanctions Bill was voted down by the Labour Party last year. It would have allowed the restraint or freezing of assets of designated entities deemed to be a threat to peace and security in the Asia-Pacific, or a breach of international peace and security. Prime Minister Jacinda Ardern said re-considering it is not "currently on the agenda".

New Zealand does not have any economic sanctions against Russian entities, including oligarchs, banks, or state-linked companies operating here. This country imposed some measures against Russia - a targeted travel ban against Russian government officials and associates, prohibiting the export of goods to Russian military and security forces and suspending bilateral foreign ministry engagement indefinitely.

The New Zealand-linked oligarchs include the billionaire steel magnate, Alexander Abramov, who owns a mansion and 215 hectares of land in Northland. Public flight and maritime records have a plane and boat linked to him in the Maldives as of a few days ago.

Ukraine-born Kiwi lawyer Anastasiya Gutorova said the government needs to impose more serious measures.

"I want the New Zealand government to freeze the assets of Putin's backers, who are oligarchs, who have assets in New Zealand," Gutorova said.

"I'm asking them to put pressure on Putin to stop this war. If they fail to do that, I'm asking the New Zealand government to confiscate those assets and use them for the benefit of the Ukrainian people."

But at the moment it's not clear if assets can be frozen or restrained under New Zealand law for this reason, Waikato University international law expert Alexander Gillespie said. A tailor-made piece of legislation would be needed to avoid any uncertainty - such as the Autonomous Sanctions Bill.

National MP Gerry Brownlee had this bill read in parliament last year. It would have allowed sanctions against individuals and entities. National and ACT voted for it; the Labour, Green and Māori parties voted against and the bill failed.

"You've got to make a strong statement about a man who's out there quite frankly threatening the nuclear option. Autonomous sanctions would allow New Zealand to participate in the economic sanctions that the rest of the world are starting to inflict," Brownlee said.

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National MP Gerry Brownlee Photo: RNZ / Samuel Rillstone

A number of Western allies have imposed sanctions, including Australia, which sanctioned Russian banks and around 350 Russian citizens.

Brownlee said the government should reintroduce this bill, and pass it quickly.

Gillespie agreed. Normally, he said, sanctions are imposed through a United Nations process, but this is not possible in this conflict.

"The problem you have now is the Russian veto [as a permanent member of the UN Security Council] will ensure there will be no sanctions imposed by the United Nations against Russia. So we need to work outside of the UN system, so we can still put sanctions against countries which violate principles which we hold high and dear," Gillespie said.

Dr Gillespie said New Zealand should act in accord with our allies, who largely have imposed economic punishments on Russia.

Brownlee said the government's response is well short of what his party would do.

"It does look like we're just a little bit on the edge of saying 'oh, they'll fix it. Someone will do something'. But we need to step up. It needs to be us that does our bit here as well."

Ardern said she has sought advice from the Ministry of Foreign Affairs on whether measures should be taken to impact Russian investment into New Zealand, but sanctions are not being considered.

At her post-Cabinet briefing today, she said the government was looking at further action it could take, including through limiting incoming investment into New Zealand from Russia.

Ardern said autonomous sanctions were not the only way New Zealand could respond, and changing the entire autonomous sanctions regime for every future scenario would not be as quick as some of the other options being considered.

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