Controls on exports and sensitive countries

• Senior Compliance Officer (SCO): : responsible for supervising the implementation of this Directive and the Guidelines on Trade Compliance, with the possibility to report potential risks or violations to the Chairman and Managing Director, as well as to the other bodies and internal committees
• Trade Compliance (TCO): responsible for management and coordination of Trade compliance activities of Leonardo at the One Company and Group level. As part of TCO, TCD (Trade Compliance of Division) is in charge of managing the trade compliance activities of each Division and ITC (UK/International Trade Compliance) is in charge of coordination and monitoring of Trade Compliance activities of foreign Subsidiaries.
• Trade Compliance Subsidiary (TCS): responsible for ensuring the implementation of Directive 5/2016, in particular TCS of Direct and Strategic Subsidiaries have the responsibility to act as connection with TCO/ITC and with TCS of indirect controlled subsidiaries.

Leonardo has issued, and regularly updates, the Guidelines and the Group’s Directive that establish, among other matters, the minimum requirements of the Trade Compliance Program, in order to ensure the observance of the provisions established by the applicable laws and by the relevant authorities, especially with reference to the legal systems in which the Group operates (Italy, US and UK ) and the international regulations (in particular, the Resolutions of the United Nations Security Council) and European regulations (Council of the European Union). Every Division of Leonardo and the Subsidiaries exposed to Trade Compliance risks is required to adopt/update  specific procedures.

The risk analysis, expected by the Guidelines and Directive is performed and repeated on a regular basis with reference to the company transactions involving defence materials, goods and services, technical data and applications for dual use and, within the sensitive countries, with reference also to commercial products. This analysis takes into account the laws of the jurisdictions in which Leonardo and the respective subsidiaries are incorporated and operate (including the countries in which supplies are performed), as well as EU and US laws that define and control the export and marketing of such goods and services. The risk analysis process is subject to review on a regular basis and also on the occasion of special events that may expose to Trade Compliance risks (for example mergers, acquisitions, development of new products or services).

Verification of new customers/end users, shall be carried out prior to any sale (for example type of entity, ownership structure and any other information on the customer’s reputation and integrity). Based on the analysis of this information, the company is capable of assessing whether there are potential risks ("red flags").

This screening system aims to carry out appropriate verifications on the customers and on the relevant parties to a transaction, including end users, in order to verify and identify if they are included in lists as proscribed persons, are subject to trade restrictions or prohibitions.

Some transactions, even non-related to export or re-export of materials subject to restriction and directed towards countries concerned with embargoes, sanctions or other restrictive measures ("Sensitive Countries"), are subject to prior notification and periodic reporting.

The list of Sensitive Countries for the Leonardo Group, subject to periodical review by the Head of TCO, is currently the following:

• Afghanistan
• Belarus
• Burma
• Central African Republic
• Cyprus
• Cuba
• Democratic Republic of Congo
• Eritrea
• Fiji
• Haiti
• Iran
• Iraq
• Ivory Coast
• Lebanon
• Liberia
• Libya
• Moldova
• North Korea
• People's Republic of China, excluding Hong Kong and Macau
• Russia
• Sierra Leone
• Somalia
• Sri Lanka
• South Sudan
• Sudan
• Syria
• Ukraine
• Venezuela 
• Vietnam
• Yemen
• Zimbabwe

 

Leonardo and its subsidiaries shall retain relevant documentation for a minimum time period of five years or for any longer period provided for by local laws.