SANCTIONS

Sanctions are restrictive measures that can be imposed to achieve certain purposes. Sanctions are a form of intervention often seen as a course of action between war and diplomacy.

If you are a designated person or dealing with a designated person/entity, you or they will appear on the relevant sanctions list.

In the UK, sanctions are imposed in order to support foreign policy and national security objectives. They also maintain international peace and security and prevent terrorism. The EU sanctions are tools of its Common Foreign and Security Policy (CFSP), aimed at bringing a change in the policy or conduct of those targeted, with a view to promoting CFSP’s objectives. The US also uses sanctions as an important foreign policy tool and imposes financial and trade restrictions against jurisdictions, natural and legal persons that violate US foreign policy or national security goals.

Sanctions targets can include:

• Governments of countries due to their policies;
• Entities providing the means to conduct the targeted policies;
• Terrorists groups; and
• Individuals involved in terrorist activities or supporting the targeted policies.

The UK implements sanctions regimes through various regulations made under the Sanctions and Anti-Money Laundering Act 2018 (SAMLA 2018). SAMLA, a primary legislation, provides the main legal basis for the UK to impose, update and lift sanctions. Sanctions regulations pertaining to specific regimes (e.g. The Russia (Sanctions) (EU Exit) Regulations 2019; or The Bosnia and Herzegovina (Sanctions) (EU Exit) Regulations 2020) are secondary legislations and are made under SAMLA 2018.

Some sanctions measures can apply through other legislation, for instance, the Immigration Act 1971, the Export Control Order 2008, and the Terrorist Asset-Freezing Act 2010.

The UK sanctions regime imposes severe restrictions on and penalties for engaging with listed entities and individuals.

A breach of UK sanctions is a strict liability offence (this means that a breach can still incur where there is no specific intent (e.g. in circumstances of carelessness or even a mistake)). Since 15 June 2022, the Office for Financial Sanctions Implementation (OFSI) has had the power to impose fines on those responsible for sanctions breaches, even in the absence of that person having knowledge or reasonable cause to suspect the breach. In determining whether to issue a monetary penalty for a sanction breach OFSI may take into consideration various factors, including but not limited to the:

• Level of due diligence conducted and whether it was appropriate to the degree of sanctions risk and nature of the transaction;
• Financial value of the breach;
• Public interest;
• Extent of the breach; or
• Offender’s behaviour;

Attempted circumvention. A breach of UK financial sanctions may also be a criminal offence, punishable upon conviction by up to 7 years in prison and/or a fine. This is detailed further under the Financial Sanctions.

Challenging your sanctions designation

You may wish to challenge the basis on which you have been sanctioned. If you have been sanctioned in the UK, under the SAMLA you can request a variation or revocation of the designation. This is done by way of an application under s.23 SAMLA. Gherson’s team is skilled in gathering substantive evidence in the form of witness statements and expert reports for its sanctioned clients in support of their designation challenge. Gherson has succeeded in substantially varying the designation of its clients.

Thereafter, it is possible to challenge the decision not to vary or revoke the designation by way of an application to the High Court for a review of the FCDO response to the challenge brought under s.23 SAMLA.

If applicable in multi-jurisdictional matters, Gherson can take on the role of coordinating with lawyers in other jurisdictions who are in parallel preparing challenges to the sanction’s designations.  In summary, while the sanctions regime may be difficult to navigate, Gherson is able to advise you on compliance with the UK sanctions regime as well as in challenging your designation for revocation or variation.

Gherson is able to provide specific advice and assistance including with respect to Financial Sanctions and Immigration Sanctions.

Advice and assistance with sanctions compliance

If you are dealing with a sanctioned individual/entity, Gherson can advise on sanctions compliance, screening and risk assessments. Gherson has extensive experience in all aspects of UK sanctions and immigration law.

More details are provided in our Sanctions Compliance section.