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This publication is available at https://www.gov.uk/government/publications/counter-terrorism-international-sanctions-guidance/counter-terrorism-international-sanctions-guidance
As required by section 43 of the Sanctions and Anti-Money Laundering Act 2018 (‘the Sanctions Act’), the Secretary of State for Foreign and Commonwealth Affairs has provided this guidance to assist in the implementation of and compliance with the Counter-Terrorism (International Sanctions) (EU Exit) Regulations 2019 (the ‘Regulations’).
As required by the Sanctions Act, this document contains guidance on the prohibitions and requirements imposed by the Regulations. It additionally provides guidance on best practice for complying with the prohibitions and requirements; the enforcement of them; and circumstances where they do not apply.
This document is intended to be read alongside more detailed sanctions guidance published by departments including the Department for International Trade (DIT), Home Office and HM Treasury, through the Office of Financial Sanctions Implementation (OFSI). This document contains links to those key sources of sanctions guidance, which will be regularly maintained and updated on GOV.UK. It is designed to give an overview of the prohibitions and requirements in the Regulations and, where appropriate, direct readers to further detailed guidance. This document is current on the date of publication.
1. Prohibitions and requirements imposed by the Counter-Terrorism (International Sanctions) (EU Exit) Regulations 2019
These Regulations impose financial, trade and immigration sanctions for the purposes of furthering the prevention of terrorism in the United Kingdom (UK) or elsewhere and contribute to the UK meeting its obligations under UN Security Council Resolution 1373 (2001) adopted by the Security Council on 28 September 2001.
To achieve the stated purposes, the Regulations impose a number of prohibitions and requirements. The Regulations establish penalties and offences, which are set out in detail in the corresponding report under Section 18 of the Sanctions Act in relation to criminal offences.
The sanctions imposed by these Regulations apply within the territory of the UK and in relation to the conduct of all UK persons wherever they are in the world. UK persons includes British nationals, as well as all bodies incorporated or constituted under the law of any part of the UK. Accordingly, the sanctions imposed by these Regulations apply to all companies established in any part of the UK, and they also apply to branches of UK companies operating overseas.
It is prohibited to intentionally participate in any activities if you know that the object or effect of them is to circumvent the sanctions imposed by these Regulations or to enable or facilitate others to contravene of those sanctions.
If you are unclear about any aspects of the Regulations, in particular about whether action you are considering taking could contravene these Regulations, you are advised to seek independent legal advice. Prohibitions and requirements for the financial and trade sanctions contained in these Regulations are set out below.
1.1 Designation of persons
The Regulations provide that the Secretary of State may designate persons for the purposes of financial, trade and/or immigration sanctions if they are or have been involved in terrorist activity. When these Regulations are in force a list of those persons designated under them and details of the sanctions in respect of which they have been designated, will be on GOV.UK.
1.2 Financial sanctions
The Regulations impose financial sanctions through a targeted asset freeze on designated persons. This involves the freezing of funds and economic resources (non-monetary assets, such as property or vehicles) of designated persons and ensuring that funds and economic resources are not made available directly or indirectly to, or for, the benefit of designated persons.
More information on asset freezes can be found in OFSI guidance.
OFSI is the authority responsible for implementing the UK’s financial sanctions on behalf of HM Treasury. OFSI helps to ensure that financial sanctions are properly understood, implemented and enforced in the United Kingdom. Further information on how OFSI implements financial sanctions can be found on the OFSI pages of GOV.UK.
1.3 Trade sanctions
The Regulations impose trade sanctions in relation to designated persons. The trade sanctions include prohibitions relating to:
- military goods and technology (as specified in Schedule 2 to the Export Control Order 2008)
- the provision of technical assistance, brokering services, financial services and funds relating to military goods and military technology
- the provision of technical assistance, brokering services, financial services and funds relating to enabling or facilitating the conduct of armed hostilities
There are circumstances (set out in the relevant lists of controlled items) in which certain items are not controlled, for example when body armour or a helmet is accompanying a person for that person’s own protection. Please check the relevant lists as applicable.
DIT has overall responsibility for trade sanctions licensing. For general guidance on export controls and trade sanctions, contact the Export Control Joint Unit: email:firstname.lastname@example.org
helpline: +44 (0)20 7215 4594
1.4 Immigration sanctions
The effect of these Regulations is to impose a travel ban on persons who are designated by the Secretary of State for the purposes of being made subject to immigration sanctions under the Sanctions Act. Such persons are excluded persons for the purposes of section 8B of the Immigration Act 1971.
This means that those individuals will be refused leave to enter or remain in the UK. Any applications they make for a visa to travel to the UK, including for transit purposes, will be refused. A foreign national who is subject to a travel ban under these Regulations, and is currently in the UK, will have their leave to enter or remain in the UK cancelled and steps will be taken to remove them from the UK.
If you are the subject of an immigration sanction and try to travel to the UK, carriers are required to deny you boarding.
Further information on how the Home Office deals with those who are subject to a travel ban can be found on the Home Office pages of GOV.UK.
1.5 Information and record keeping
Part 7 of the Regulations places obligations on relevant firms (the definition of which is set out in the Regulations) to report information to HM Treasury about known or suspected designated persons or about persons who have committed an offence under these Regulations.
Part 7 grants powers to HM Treasury to request information from a designated person, including powers to request the production of documents. It also establishes offences for failing to comply with these requests (including providing false information).
If you have obligations or responsibilities under Part 7 of these Regulations, it is important that you familiarise yourself with them. If you are unclear of your obligations or responsibilities, you are advised to seek independent legal advice.
2. How will these sanctions measures be enforced?
The Regulations make it a criminal offence to contravene the trade and financial sanctions as well as to enable or facilitate a contravention of, or to circumvent, any of the prohibitions in these Regulations. They also prescribe the mode of trial and penalties that apply to such offences.
In addition to the below, further details on offences and penalties can be found in the relevant section 18 report accompanying these Regulations.
2.1 Financial sanctions
Breaches of financial sanctions are a serious criminal offence. Any breach of the main financial prohibitions in the Regulations is an offence that is triable either way and carries a maximum sentence of seven years’ imprisonment or a fine (or both).
Committing an offence under regulations 34(6) or 38 (information offences in connection with financial sanctions under the Regulations) is summary only and carries a maximum sentence of 6 months’ imprisonment or a fine (or both).
OFSI is responsible for monitoring compliance with financial sanctions and for assessing suspected breaches. It also has the power to impose monetary penalties for breaches of financial sanctions and to refer cases to law enforcement agencies for investigation and potential prosecution.
OFSI works with other parts of government, supervisory bodies and regulators to consider all cases reported to it, sharing relevant information accordingly.
If you find out that a person or organisation you are dealing with is subject to the financial sanctions detailed in the Regulations, you must immediately
- stop dealing with them
- freeze any assets you’re holding for them
- inform OFSI as soon as possible by either emailing: email@example.com, or by calling the general enquiries line: +44 (0)20 7270 5454
More detailed information on OFSI’s approach to compliance and enforcement can be found in Chapter 7 of OFSI’s guidance.
2.2 Trade sanctions
Any breach of the prohibitions relating to the trade sanctions contained in these Regulations is triable either way and carries a maximum sentence of 10 years’ imprisonment or a fine (or both).
HM Revenue and Customs (HMRC) is responsible for enforcing the trade prohibitions and investigating suspected offences.
If you discover that you have breached any of the trade prohibitions, you should report the irregularity to HMRC (sometimes known as ‘voluntary disclosure’) as soon as possible. If the irregularity was found on an Export Control Joint Unit compliance audit, the compliance inspector will have informed HMRC and you are strongly advised to do the same. Guidance is available on how to make a voluntary disclosure.
3. Are there circumstances when I can get an authorisation or licence for a sanctioned activity?
Licensing and exception provisions are contained in Part 6 of these Regulations.
The Regulations set out exceptions to some of the sanctions prohibitions which apply within certain defined circumstances. An exception applies automatically, and does not require you to obtain a licence. These Regulations establish exceptions relating to financial sanctions including for the crediting of a frozen account, providing that any such interest or other earnings are frozen in accordance with the legislation underpinning the asset freeze. There is an exception for when funds are transferred to a relevant institution for crediting to an account held or controlled by a designated person in discharge (or partial discharge) of an obligation which arose before that person became a designated person.
There are circumstances in which certain prohibitions under the trade sanctions in these Regulations do not apply, such as for example when body armour or a helmet is accompanying a person for that person’s own protection. Please check the relevant legislation as applicable.
The Regulations also include an exception in relation to any prohibition or requirement imposed by these Regulations for acts done for the purposes of national security or prevention of serious crime. If you are unsure whether an exception applies in your circumstances, you are advised to seek independent legal advice.
3.2 Licensing for financial sanctions
Where a person is designated for the purposes of the financial sanctions contained in these Regulations, the person or a representative (on their behalf) may apply for a licence from OFSI to use their funds or economic resources. Regulation 31 provides that the prohibitions in regulations 11 to 15 (asset freeze etc.) do not apply to anything done under the authority of a licence issued by the Treasury under paragraph 1 of that regulation. This regime does not contain specific licensing grounds and instead contains a general power to issue licences. HM Treasury will exercise these powers according to the enabling legislation, taking into account any relevant law and the purpose of the regime.
Further information on exemptions and licensing grounds can be found in OFSI’s guidance.
Information on licence applications and the relevant form can be found on OFSI’s gov.uk webpage.
3.3 Trade sanctions
These Regulations do not contain a power to issue licences in respect of trade sanctions. If you are engaging in trade with a designated person you are advised to undertake due diligence to ensure that you are not breaching the prohibitions in these Regulations. The goods and technology subject to prohibitions under the trade sanctions in these Regulations are those found in Schedule 2 to the Export Control Order 2008. When you export goods, you may need to submit an electronic export declaration via the National Export System (NES), part of Her Majesty’s Revenue and Customs’ (HMRC) Customs Handling of Import and Export Freight (CHIEF) system. Guidance is available on how to make an export declaration.
3.4 Exemptions in respect of immigration sanctions
If you are subject to immigration sanctions the Home Office may direct, on a case by case basis, that the sanction does not apply in particular circumstances, such as for travel to, or through, the UK for a UN sponsored meeting. You can check on how to apply for a UK visa, and further information about travelling to the UK on GOV.UK.
4. Further information
Sign up to receive Notices to Exporters for updates on trade sanctions.
To receive an email alerting you to any changes to the consolidated list of financial sanctions targets, you can subscribe to OFSI’s e-alert.