OFAC Narcotics and Zimbabwe de-listings

OFAC has de-listed 6 people and 2 entities previously listed as Specially Designated Narcotics Trafficking Kingpins and 5 people and 3 entities listed under its Zimbabwe regime from its list of Specially Designated Nationals.  Following this action, OFAC removed “Zimbabwe General Licence 1”, which authorised all transactions with Agricultural Development Bank of Zimbabwe and Infrastructure Development Bank of Zimbabwe, from the Zimbabwe page of its website, given that the entities it applied to are no longer designated.

OFAC also amended the entries for 1 person listed under its terrorism sanctions and 1 entity listed under its sanctions on Burundi.  The full details of the changes are here.

UK Supreme Court rejects Youssef UN sanctions appeal

The UK Supreme Court has dismissed Mr Youssef’s appeal in his judicial review of the Foreign Office’s decision not to object to his listing on the UN’s Al-Qaida 1267 asset freezing regime. A link to the judgment is here Youssef v Secretary of State for Foreign and Commonwealth Affairs [2016] UKSC 3.

The main grounds of challenge were that the FCO had reason to believe that the information on which Security Council members were relying was obtained by torture, and that the courts had used the wrong standard of review.

The Supreme Court has said there should be a hands-off / non-intrusive approach to judicial review of the FCO’s decision. It is to be contrasted with the Ahmed judgment (HMT v Ahmed & Youssef) [2010] UKSC 2 & 5) which concerned (among others) the same Mr Youssef, in which the UK Supreme Court struck down the UK measure implementing his UN designation. The Supreme Court in Youssef has held that there is no duty to inquire into whether other states were relying on torture evidence, and that the legality of the measure was authorised by the EU implementing regulation (Regulation 881), unlike the measure at issue in Ahmed. The Court also took into account the fact that the UN Ombudsperson for the Al Qaida Sanctions Committee had recommended that Mr Youssef should remain listed.

US adds to Hizballah sanctions

The US Treasury has sanctioned 2 people said to be Hizballah money launderers, Mohamad Noureddine and Hamdi Zaher El Dine, and Trade Point International S.A.R.L., which is owned or controlled by Noureddine.

Mr Noureddine, with the assistance of El Dine, is said to have transferred substantial amounts of money in support of Hizballah’s commercial investment activity in Lebanon and Iran, and used an extensive network across Asia, Europe, and the Middle East to provide money laundering, black market currency exchange, and other financial services to a number of clients, including Hizballah.

In the Treasury’s press release, Adam Szubin, Acting Under Secretary for Terrorism and Financial Intelligence, says “Hizballah needs individuals like Mohamad Noureddine and Hamdi Zaher El Dine to launder criminal proceeds for use in terrorism and political destabilisation”.

Supreme Court of Bermuda does not allow LIA to redeem shares

The Supreme Court of Bermuda, a British Overseas Territory, has upheld Cornhill Natural Resources Fund Limited’s (the Fund) decision not to allow the Libyan Investment Authority (LIA) to redeem investment shares held in it by its nominee HSBC (link to judgment here).

The Fund argued that, under The Libya (Restrictive Measures) (Overseas Territories) Order 2011 as amended (which implements UN sanctions on Libya), it could not process LIA’s request without a licence from the Governor of Bermuda given that the Order froze LIA’s assets.  Responding, LIA stated that Article 12(1)(b) of the Order allowed payments into frozen accounts due under contracts, agreements, or obligations that were concluded or arose prior to the date on which an account holder became a designated person, noting that their investment in the Fund occurred in 2008, prior to the Order which froze their assets.  However, the Court rejected LIA’s submission, finding that LIA was not a designated person and its assets were frozen on separate grounds, and so Article 12(1)(b) offered it no relief.  Instead, the Court suggested that the remedy was to seek a licence, which statements made by the Governor in March 2015 indicated he would have no objection to.

US adds 5 people to Magnitsky sanctions

The US has added 5 Russians under the US Magnitsky Act, which targets people involved in the death of Russian lawyer Sergei Magnitsky or related human rights abuses.  The now 39 people designated under the act are ineligible for visas and admission to the US, and are listed as Specially Designated Nationals, with the effect that their assets are frozen and US persons are prohibited from doing business with them.

4 are said to have been involved in Magnitsky’s death.  They are former head of the Russian Interior Ministry’s investigative department Aleksey Anichin, who authorised the criminal case under which Magnitsky was arrested, former head of its investigative department of organised criminal activity Pavel Lapshov, and Boris Kibis and Oleg Urzhumtsev who were involved in Magnitsky’s posthumous prosecution.  The 5th is Yevgeni Antonov, who according to the US State Department ran a prison in Chechnya notorious for human rights abuses.

Asked about the possibility of including people on the Magnitsky list in connection with the killing of British citizen Alexander Litvinenko (see previous blog), a senior State Department official said following these latest designations that “…we will – our process…is an open one.  Without discussing the specifics, we are continuing our work”.

Australia lifts Iran sanctions

Australia (following the US, EU, Switzerland, and Japan) lifted its nuclear-related sanctions against Iran following implementation of the JCPOA.

Australia no longer prohibits the provision of goods and services for use in Iran’s petrochemical industry and trade in gold and other precious metals, among other activities. Some sanctions remain in force, including prohibitions on business with certain people and entities, activities related to Iran’s ballistic missile programme, and an authorisation requirement for transactions to or from Iran worth more than AUD 20,000.

The Australian Department of Foreign Affairs and Trade’s press release is here.

Bank of England licences to 3 Iranian banks

Following implementation of the JCPOA (see previous blog), the Bank of England has reactivated the licences of Melli Bank, Persia International Bank and Bank Sepah International, Iranian banks that were previously subject to EU and US sanctions, allowing them to resume operations in the UK.

The banks must come into compliance with several rules introduced during the period in which they were subject to sanctions before they can start trading. This will involve evidencing adequate capital, staff, and systems for risk management, governance, etc.  They will receive assistance from the new Bank of England / FCA Prudential Regulation Authority, designed to encourage banks to gain regulatory approval and start operations by allocating specific resources to them.

Switzerland implements additional EU and UN Iran de-listings

Switzerland has followed the EU, US, and UN in de-listing Bank Sepah from its sanctions against Iran (see previous blog), along with Naser Bateni and the company he manages Hanseatic Shipping Trust, whose EU listings were annulled in October 2015 (see previous blog), and 3 entities connected to Islamic Republic of Iran Shipping Lines, also reflecting UN and EU modifications to their own sanctions.

The Swiss Government’s notice is here.