What’s this about?
The UK sanctions regime on Russian individuals and entities under the UK sanctions regime with regard to the war in Ukraine has continued to develop; for more about how the UK sanctions regime works see the What is the UK sanctions regime? section of our article here https://www.corderycompliance.com/add65uksanctions/.
This article looks in brief at the latest developments.
What are the most recent substantive developments concerning UK sanctions on Russia?
The most recent substantive sanctions developments include the following:
- Provisions relating to widening the definition of “relevant firm” to include “crypto-asset exchange providers” and “custodian wallet providers” came into force;
- The Treasury/The Office of Financial Sanctions Implementation called on all those that hold or control the funds or economic resources of a so-called “designated person” under the UK’s Sanctions and Anti-Money Laundering Act 2018 to report details of those assets for the annual review of frozen assets – the closing date for submission of information is 11 November 2022;
- 92 entries were added to the UK sanctions list and are now subject to an asset freeze – see here for the list:
- The Office of Financial Sanctions Implementation imposed a monetary penalty of £30,000 against the UK registered company, Hong Kong International Wine and Spirits Competition Ltd, for breaches of (EU) sanctions rules (see here for the list of the OFSI’s enforcement actions: https://www.gov.uk/government/collections/enforcement-of-financial-sanctions); and,
- The Foreign Office announced that the UK will be implementing sanctions on services that Russia depends on and export bans on 700 goods that are key to Russia’s industrial and technological capabilities following the annexation of Ukrainian regions. The UK will prevent Russian access to IT consultancy services, architectural services, engineering services and transactional legal advisory services for certain commercial activity (for the press release see here https://www.gov.uk/government/news/sanctions-in-response-to-putins-illegal-annexation-of-ukrainian-regions).
With regard to sanctions in general, organisations should consider doing the following:
- Undertake a rigorous due diligence screening against individuals and entities on sanctions lists;
- Check whether any accounts are maintained or any funds or economic resources are held for sanctioned persons and entities;
- Freeze sanctioned accounts, and other funds or economic resources and any funds which are owned or controlled by sanctioned persons and entities, and refraining from dealing with the funds or assets or making them available (directly or indirectly) to sanctioned persons (unless licenses have been granted);
- Report any findings to the regulator and co-operating with any investigations that the regulator may undertake;
- Do a contracts clauses check on relevant contracts to ensure that provisions concerning warranties, force majeure, termination, and, liability are all up to scratch as regards sanctions;
- Update policies, procedures and risk assessments – be prepared to deal with sanctions breaches;
- Where possible and of use (either as an alternative or a complement to contract breach risk), considering obtaining insurance (export credit, political risk, and, trade disruption) against sanctions risks; and,
- Train staff on sanctions issues.
We last wrote about sanctions here https://www.corderycompliance.com/uk-sanctions-russia-recent-dev-1/ and our other articles about sanctions can be found here: https://www.corderycompliance.com/category/sanctions/.
We spoke at an event about Russian sanctions, where we focused on sanctions policies & due diligence/screening issues https://www.corderycompliance.com/rbcc-dit-russia-uk-02-dec/.
We have also written about the UK Economic Crime (Transparency & Enforcement) Act 2022 here https://www.corderycompliance.com/uk-ecte-act-sanctions-russia-belarus/.
For UK official guidance about the UK sanctions on Russian see here https://www.gov.uk/government/collections/uk-sanctions-on-russia, and the UK sanctions list can be found here https://www.gov.uk/government/publications/the-uk-sanctions-list.
The UK Sanctions and Anti-Money Laundering Act 2018 can be found here https://www.legislation.gov.uk/ukpga/2018/13/contents/enacted.
For more information please contact André Bywater or Jonathan Armstrong who are lawyers with Cordery in London where their focus is on compliance issues.
|Jonathan Armstrong, Cordery, Lexis House, 30 Farringdon Street, London, EC4A 4HH
|André Bywater, Cordery, Lexis House, 30 Farringdon Street, London, EC4A 4HH
|Office: +44 (0)207 075 1784
|Office: +44 (0)207 075 1785