OFAC publishes Belarus general licence

OFAC has published a general licence, effective from 30 October 2015 until 30 April 2016, authorising transactions with 9 entities otherwise prohibited by Executive Order 13405, which blocks the property of certain persons in relation to Belarus.  The general licence also covers entities directly or indirectly owned by those entities.

There are exceptions to the general licence, under which any property belonging to the authorised entities that was blocked prior to 30 October will remain blocked, and transactions with people and entities not expressly authorised under the general licence will remain prohibited, even if conducted through authorised entities. In addition, when US persons enter into a transaction with an authorised entity, they must report any such transaction or series of transactions in excess of $10,000 to the US State Department no later than 15 days after execution.

Belarus sanctions suspensions & de-listings

We previously reported that EU foreign ministers agreed in October to suspend targeted sanctions on Belarus for 4 months from 31 October (see previous blog).  The legal measures implementing that suspension have now been published – Council Regulation (EU) 2015/1948 amending Council Regulation (EC) 765/2006 and Council Decision (CFSP) 2015/1957 amending Council Decision 2012/642/CFSP. They maintain sanctions in force for 4 months, until 29 February 2016, but “suspend” their application for everyone on the Belarus list (171 people and 10 entities) except for 4 people involved in “unresolved disappearances” in Belarus (in respect of whom sanctions are not suspended).

The EU has also de-listed 4 entities  (LLC Triple Metal Trade, JV LLC Triple-Techno, MSSFC Logosyk, and Triple-Agro ACC) in Council Implementing Regulation (EU) 2015/1949 on the grounds that there are no longer grounds for keeping them on the list following the Chyzh judgment in the European Court (see previous blog). Some of the Belarus entities that won their applications for annulment in the Chyzh case had already been de-listed by the EU by the time of that judgment (6 October 2015); JLLC Neftekhimtrading, JLLC Triplepharm, LLC Triple-Veles on 30 October 2014 by Council Regulation 1159/2014 (see previous blog) and CJSC Askargoterminal, JLLC Variant, JLLC Triple-Deko, JCJSC Altersolutions on 13 July 2015 (by Council Decision 2015/1142, see previous blog). Others that also won their applications have not been de-listed in these latest measures (Triple TAA, Askargoterminal ZAT, Bereza Silicate Products Plant AAT, Variant TAA, Triple-Dekor STAA, KvartsMelProm SZAT, Altersolutions SZAT, Prostoremarket SZAT, AquaTriple STAA, Rakovsky brovar TAA) so sanctions on those entities remain in place but have been “suspended”.

HM Treasury’s notice on these measures is here.

UK to have new powers to ban extremist organisations

The UK government has published its Counter-Extremism Strategy, in which it sets out a strategy for dealing with extremism. It proposes (among other things) new powers to ban extremist organisations (in addition to its existing powers to proscribe organisations under the Terrorism Act), restrict the “harmful activities of the most dangerous extremists”, and restrict access to premises that are repeatedly used to support extremism. A link to the Counter-Extremism Strategy is here.

EU updates Zimbabwe, Yemen, Guinea, and Moldova sanctions regimes

The EU has published updates to its sanctions regimes on Zimbabwe, Yemen, Guinea, and Moldova.

Zimbabwe

The EU has de-listed the deceased Amos Bernard Midzi (alias Mugenva) from its targeted sanctions on Zimbabwe, which impose an asset freeze on members of the country’s government and people and entities associated with them.  Currently, the targeted sanctions are suspended against all but President Robert Mugabe, his wife Grace, and Zimbabwe Defence Industries.

A new provision has also been included in the sanctions regime to comply with requirements for the protection of personal data.

The change are made by Council Regulation (EU) 2015/1919 amending Council Regulation (EC) 314/2004, Commission Implementing Regulation (EU) 2015/1921 amending Council Regulation (EC) 314/2004, and Council Decision (CFSP) 2015/1924 amending Council Decision 2011/101/CFSP.

Yemen

The listing of Ahmed Ali Abdullah Saleh has been updated with details of his Diplomatic identity card issued by the United Arab Emirates, which is said to be cancelled, and his place of birth.  The new information is given in order to reflect changes to his listing under the UN’s sanctions on Yemen, and is introduced by Council Implementing Regulation (EU) 2015/1920 implementing Council Regulation (EU) 1352/2014 and Council Implementing Decision (CFSP) 2015/1927 implementing Council Decision 2014/932/CFSP.

Guinea

The EU has extended its sanctions regime against Guinea until 27 October 2016. The EU’s sanctions regime against Guinea imposes targeted asset freezes and travel bans on 5 people identified by the International Commission of Inquiry as responsible for violence leading to at least 150 deaths on 28 September 2009, and persons associated with them.  An arms embargo against Guinea was lifted in April 2015 (see previous blog). The regime is extended by Council Decision (CFSP) 2015/1923 amending Council Decision 2010/638/CFSP.

Moldova

EU sanctions against Moldova, imposing an EU-wide travel ban on people who are responsible for designing or implementing the campaign of intimidation and closure against Latin-script schools in the Transnistria region of Moldova, have been extended until 31 October 2016. The regime is extended by Council Decision (CFSP) 2015/1925 amending Council Decision 2010/573/CFSP.

UK Appeal Court in Bank Mellat holds that gist must be disclosed in UK Terrorism Act challenges

As previously reported (here), in 2013 the UK Supreme Court held that the UK Order in 2009 imposing financial restrictions on Bank Mellat in the UK was unlawful. Bank Mellat is now in the middle of challenging the subsequent UK Orders made in 2011-2012 which are targeted at all Iranian banks, not just at Bank Mellat. The Court of Appeal has just given an important judgment on disclosure in that context; link here Bank Mellat v HM Treasury [2015] EWCA Civ 1052.

The Terrorism Act provides for closed material procedures in the context of a challenge of this kind. The issue on appeal was the disclosure to which Bank Mellat was entitled within that closed procedure. The Bank argued that Article 6 of the European Convention on Human Rights requires in a Terrorism Act challenge, just as in a case of detention or a control order, as an “irreducible minimum”, that a sufficient gist of the essential allegations is disclosed to the bank to enable it to refute as well as deny the allegations, even where there are national security concerns that would not otherwise permit disclosure (this is the standard set out in AF (No. 3) in the House of Lords).

The Court of Appeal held that this AF (No. 3) standard of disclosure does apply, because “restrictions on the freedom to do business or to engage in financial restrictions can be as serious for a bank as restrictions on personal liberty for an individual”, there is “no doubt” that the standard of disclosure required by AF (No. 3) would apply in an asset freezing case, and although the orders against Bank Mellat were not asset freezing, they were “highly restrictive measures with very serious effects”, and therefore the same standard of disclosure applies to challenges to these Orders.

The Court also gave a closed judgment overturning the judgment below on whether there had been sufficient disclosure (Ouseley J held that there had been even if AF (No. 3) applied); the Court of Appeal disagreed and remitted the case back to the Administrative Court for reconsideration of disclosure in light of these judgments.

1st EU judgment on Ukraine misappropriation sanctions

The European Court has just handed down its 1st judgment on the EU’s targeted sanctions regime dating from 2013 that relates to Ukrainians said to be responsible for the “misappropriation of State funds”.  A link to the judgment is here: Case T- 290/14 (26 October 2015).  The Court annulled the listing of Andriy Portnov (the EU removed him from the list in any event in March of this year), who had been included on the grounds that he is “subject to criminal proceedings in Ukraine” for crimes in connection with the “embezzlement of Ukrainian state funds”.

Mr Portnov’s listing was annulled because the only evidence relied on by the EU Council to justify his listing was a letter from the Ukrainian public prosecutor in March 2014 stating that an investigation into Mr Portnov and others had “made it possible to establish” misappropriation of state funds, but that letter had not said anything specific about Mr Portnov, and the EU had not conducted its own analysis into whether he fulfilled the criteria for listing.  The EU has 2 months in which to appeal the judgment should it wish to do so.

This judgment will be important not only for the other pending cases by listed Ukrainians, but also for the similarly worded Tunisian and Egyptian regimes (see e.g. previous blogs on the Al Matri and Ezz cases).

UN to expand list of CAR sanctions targets

The UN Security Council has decided to impose more asset freezes and travel bans on people and entities engaging in or providing support for acts that undermine the peace, stability, or security of the Central African Republic, and to add to the list those responsible for the recent outbreak of violence.

The Presidential Statement unanimously adopted by the Security Council also expresses concern that the travel ban is not being fully upheld, and warns that facilitating the travel of a listed person may lead to the facilitator being listed.  France is currently drawing up a list of possible new targets.

2 sanctions events coming up in London

Please come to:

  1. 1. A discussion on ‘The Business of Sanctions’ – the challenge for the corporate world posed by sanctions. Hosted by Brick Court Chambers, the Royal United Services Institute, the Center for a New American Security and the Center on Law and Security at NYU School of Law.

18:00, 10 November 2015 – details here.

2. A conference on Capitalising on Commercial Opportunities in Post-Sanctions Iran organised by the London Business Conferences Group, with talks and discussion from leading sanctions experts, economists, business operators, and practitioners in Iranian commerce and trade. Speakers from (inter alia) the World Bank, British-Iranian Chamber of Commerce, and former diplomatic staff to Tehran.

16-17 December 2015details here, early registration discount ends on 6 November.