OFAC has designated 20 entities as Specially Designated Global Terrorists, pursuant to Executive Order 13224 (US asset freezes), for “providing financial support to the Basij Resistance Force (Basij), a paramilitary force subordinate to Iran’s Islamic Revolutionary Guard Corps (IRGC)”.
According to the US Treasury press release, “the IRGC’s Basij militia recruits, trains, and deploys child soldiers to fight in IRGC-fueled conflicts across the region. This Iran-based network is known as Bonyad Taavon Basij, which is translated as Basij Cooperative Foundation, and is comprised of [(at least) the 20 entities designated today]”, of which are “deeply entrenched in major Iranian industries, such as automotive, mines and metals, tractor manufacturing, and banking.”
The 20 entities: Andisheh Mehvaran Investment Company; Bahman Group; Bandar Abbas Zinc Production Company; Bank Mellat; Bonyad Taavon Basij; Calcimin; Esfahan’s Mobarakeh Steel Company; Iran Tractor Manufacturing Company; Iran Zinc Mines Development Company; Mehr Eqtesad Bank; Mehr Eqtesad Financial Group; Negin Sahel Royal Investment Company; Parsian Bank; Parsian Catalyst Chemical Company; Qeshm Zinc Smelting And Reduction Company; Sina Bank; Tadbirgaran Atiyeh Iranian Investment Company; Taktar Investment Company; Technotar Engineering Company; and Zanjan Acid Production Company. See OFAC Notice.
Yesterday, the UN Security Council announced that it has added British national Anjem Choudary to its ISIL (Da’esh) & Al-Qaida sanctions list for “recruiting for” and “otherwise supporting acts or activities of” ISIL (asset freeze, travel ban, and arms embargo imposed). The UN Narrative Summary of Reasons for Listing notes that Mr Choudary was sentenced in the UK (September 2016) for inviting support for ISIL, and that since his conviction and imprisonment, he has not made any statements denouncing his allegiance to and support for ISIL.
The UK Commercial Court has given judgment in Mamancochet Mining Ltd v Aegis Managing Agency Ltd & Others  EWHC 2643 (Comm) holding that:
– Defendants are liable to pay insurance claim under a marine insurance contract (covering the theft of shipments of steel billets).
– This is because payment would not “expose” the underwriters to EU or US sanctions on Iran if paid out before 4 November 2018 (the end of the wind down period for reimposed US Iran sanctions) therefore the sanctions clause (“no… insurer shall be liable to pay any claim… to the extent that… payment of such claim… would expose that… insurer to any sanction, prohibition or restriction under [UN] resolutions or the trade or economic sanctions, laws, or regulations of the [EU], [UK] or the [USA]”) does not apply.
– The Court said that “exposure” to sanctions meant that the payment had to breach sanctions as opposed to exposing insurers to a real risk of breach.
– The risk was insufficient here because US sanctions waivers were in place until 4 November 2018 (the wind down period following the US decision to withdraw participation in the JCPOA).
– The Court did not reach a concluded view on the Claimant’s argument that reliance on the sanctions clause would breach the EU Blocking Regulation, but saw force in the argument that the Blocking Regulation was not engaged where the insurer’s liability to pay a claim is suspended under a sanctions clause because the insurer is not “complying” with a third country’s prohibition but is simply relying upon the terms of the policy to resist payment.
The Government has published a notice explaining how the UK will implement sanctions if the UK leaves the EU in March 2019 with no agreement as to the UK/EU future relationship. The notice says:
- The UK will continue to implement UN sanctions in UK law.
- The government will “look to carry over all EU sanctions at the time of our departure”.
- The UK will implement sanctions by regulations made under the Sanctions & AML Act 2018. “Much of” the required legislation will be put before Parliament before March 2019 and any other EU regimes not covered by that legislation will continue as “retained EU law under the EU (Withdrawal) Act 2018”.
- The new regulations will include the purpose of sanctions, listing criteria and people & entities listed, details of the prohibitions, exemptions and enforcement, and information sharing.
- After the UK leaves the EU, it will “work with the EU and other international partners on sanctions where this is in our mutual interest”.
Max Hill QC, the UK Independent Reviewer of Terrorism Legislation, has published his final annual report (10 October) on the operation of the Terrorism Acts in 2017. It covers proscribed organisations (5 organisations were proscribed in 2017) and the replacement of the current Terrorist Asset Freezing Act 2010 with the Sanctions and Anti-Money Laundering Act 2018 for terrorist asset freezing in the UK. The report also makes a number of recommendations on TPIMs and port and border controls.
The 7th annual C5 Economic Sanctions & Financial Crime Event will take place on 14 – 15 November 2018 at St. James’ Court Hotel, London, SW1E 6AF.
Maya Lester QC will be speaking on Brexit and sanctions. Details in the Conference Brochure. Code S15-999-SPK18 for a 15% online discount.
The UN Special Rapporteur Idriss Jazairy has published a Report expressing concerns about the impact of “unilateral sanctions” (i.e. non UN sanctions regime) on fundamental rights.
He recommends human rights assessments and judicial review, and expresses concern about the use of sanctions as economic warfare, the potential for discriminatory effects, the impact of US sanctions on Iran and Russia, and the extraterritorial effect of US sanctions. The report suggests the ultimate abolition of unilateral sanctions, and before then a draft declaration to establish an international consensus on the minimum human rights protections that must be applied to the use of unilateral sanctions.
We reported last week that Standard Chartered could face a possible $1.5 billion fine after US regulators engaged in negotiations with the bank into whether it had processed US dollar transactions for Iranian entities after entering into a US Deferred Prosecution Agreement (DPA) in 2012.
This week, US prosecutors have now informed Standard Chartered that criminal charges may be brought against two of the bank’s former employees over the Iran sanctions violations. The bank has yet to comment on both issues.