Written answers

Wednesday, 26 November 2014

Department of Foreign Affairs and Trade

Banking Sector

Photo of Maureen O'SullivanMaureen O'Sullivan (Dublin Central, Independent)
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16. To ask the Minister for Foreign Affairs and Trade the measures that are being taken by his Department regarding the current situation whereby a foreign jurisdiction may impose freezes and implement restrictions on Irish banking institutions registered under the Central Bank of Ireland, a situation currently happening with Irish banks being forced to close accounts here with any connection with Cuba; and if he will make a statement on the matter. [44974/14]

Photo of Charles FlanaganCharles Flanagan (Laois-Offaly, Fine Gael)
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The Deputy is referring to the extraterritorial application of US legislation in connection with that country's sanctions against Cuba. Together with our partners in the European Union, we have firmly and continuously opposed extraterritorial measures that seek to extend the US's embargo against Cuba to third countries as contrary to commonly accepted rules of international trade.

Our position in this regard was set out most recently at the UN General Assembly on 28 October this year in the context of the resolution on the necessity of ending the economic, commercial and financial embargo imposed by the US against Cuba. We continue to encourage the United States to take steps to alleviate the problems arising from its extraterritorial legislation.

As regards the recent closure of bank accounts in Ireland, I would recall that my colleague, Mr Michael Noonan, T.D, Minister for Finance, advised the House in reply to a Question on 14 October this year of the reasons quoted by the Irish bank in question as to why they have taken this step. These relate, in summary, to the fact that the bank in question relies on a US correspondent bank for the processing of its national, European and international transactions and that, as a result, they are not in a position to process the relevant transactions.

The Minister advised also that he has no direct function in the relationship between banks and their customers nor does he have a statutory function in relation to banking decisions made by individual lending institutions. I would refer the Deputy to Question No. 43 of 14 October 2014 for the full details.

While the reasons quoted for closing the accounts may relate, at least in part, to operational considerations on the part of the bank in question, issues arising from the extraterritorial application of US legislation regarding Cuba remain important. For that reason, I instructed my officials to raise the matter in recent consultations with the US State Department. We drew their attention to the impact of the legislation on business and others in Ireland, and recalled our position on the relevant legislation. We are currently in the process of following up further with the US side in the matter.

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