Europe Minister explains UK sanctions regulations for no deal Brexit

Parliament1The Europe Minister Alan Duncan MP has written to the Chair of the House of Commons Foreign Affairs Committee, Tom Tugendhat MP, outlining what the Foreign & Commonwealth Office is doing to prepare for the possibility of a no-deal Brexit. They will:

1.      Begin laying statutory instruments (UK Regulations) to enable sanctions regimes to be implemented under the Sanctions Act, which will come into force on exit day.

2.      The plan is one SI per sanctions regime. They will prioritise “the most complex, high profile and changeable regimes” and have “de-prioritised” regimes where the UK can “rely on retained EU law [under the UK Withdrawal Act] until new regulations are made and the retained law is revoked”.

3.      Half of sanctions regulations will be subject to negative procedure, half the “made-affirmative” procedure.

UK chemicals company fined $7k for violating export controls

HMRCA Leicestershire-based company, VWR International Ltd, has been fined a total of £7,039 at City of London Magistrates Court after pleading guilty to 4 counts of exporting goods contrary to a prohibition or restriction. Specifically, VWR illegally shipped 4 consignments of controlled chemicals and metal to foreign jurisdictions without the required export licence. VWR shipped the first consignment days after being denied the necessary licence, and failed to apply for the required licence in relation to the other three consignments. The case was investigated and prosecuted on behalf of HMRC.

UK adopts Sanctions Review Procedure Regulations

Parliament6The UK has adopted the Sanctions Review Procedure (EU Exit) Regulations 2018, SI 2018/1269, which come into force on 7 January 2019.

They make provision for (inter alia) the procedures under the UK Sanctions Act to enable people / entities to request a review, variation or revocation of a sanctions listing or ship specification.

UK sentences 3 people for trafficking fighter jet parts to Iran

Parliament8Three individuals – Alexander Samuel George, Paul Robert Attwater, and Iris Louise Attwater – have been convicted in the UK of evading export controls in relation to Iran.

Alexander George, who was sentenced yesterday to 2½ years’ imprisonment, shipped military items to Iran, including Russian MiG and US F4 Phantom parts, through various companies and countries without the appropriate licence. Paul Attwater and his wife Iris, who each received suspended sentences of 6 months’ imprisonment last month, sourced dual-use aircraft parts from the USA and shipped them to Alexander George’s companies in Malaysia and Dubai, which then sent them to Iran.

The offenders were also disqualified from being a company director (9 years for Alexander George, and 6 years each for Paul and Iris Attwater). POCA proceedings will now follow to recover the money made from the criminality. See UK Press Release.

Majority of UK Sanctions Act now in force today

Parliament3The UK government has adopted the Sanctions and Anti-Money Laundering Act 2018 (Commencement No. 1) Regulations 2018 (SI 2018/1213), which brings into force today (22 November) the vast majority of the remaining sections of the Sanctions and Anti-Money Laundering Act 2018.

Some of the anti-money laundering sections are still not in force (sections 49 and 51), as well as provisions dealing with the repeal of certain existing UK sanctions legislation (see section 59).

EU Withdrawal Agreement – sanctions provisions

EU-UK.jpgThe Draft UK Withdrawal Agreement provides for a transition period (until 31 December 2020) during which EU law, including the Common Foreign and Security Policy (CFSP), will continue to apply to and in the UK. This means the UK will continue to implement EU sanctions during this period (see Part 4, Articles 126 and 127(1) of the Agreement, and Section IV of the EU press release).

If the EU and UK reach an agreement governing their future relationship in the area of CFSP which becomes applicable during the transition period, then the EU’s CFSP provisions and the sanctions adopted on the basis of those provisions will cease to apply to the UK from the date of that new agreement (see Part 4, Article 127(2) of the Agreement).

The EU and UK have outlined the political declaration setting out the framework for their future relationship, saying there will be a “[c]onsultation on sanctions, with intensified exchange of information where foreign policy objectives are aligned, with the possibility of adopting mutually reinforcing sanctions.” See UK Government Explanatory Slides.

UK calls for Skripal suspects to be included in EU chemical weapons sanctions

UK GovFollowing last month’s adoption of a new EU chemical weapons sanctions regime, the UK will ask for the first listings to include a number of individuals said to be involved in the Novichok poisoning of Sergei and Yulia Skripal in Salisbury, including the two Russian military intelligence officers Anatoliy Chepiga and Alexander Mishkin.

Commons Committee clears EU chemical weapons sanctions regime from scrutiny

Parliament2

The House of Commons European Scrutiny Committee has cleared from scrutiny the EU’s decision to adopt a new sanctions regime targeting the use and proliferation of chemical weapons (see previous blog). The Committee said:

  • After 29 March 2019, the UK will cease to be bound by the EU’s Common Foreign and Security Policy (CFSP) of which this new chemical weapons sanctions regime forms part;
  • The UK will lose its current veto over most new EU foreign policy measures and its current significant degree of influence over the general direction of the CFSP;
  • The EU would benefit from a close relationship with the UK in the field of foreign policy, especially in the field of sanctions (see the House of Lords EU Committee Report stating that the UK “currently plays a leading role in developing EU sanctions policy, is most active in proposing individuals and entities to be listed, and is home to the largest international financial centre of the bloc”);
  • In the event of a ‘no deal’ Brexit, day-to-day foreign policy cooperation – coordinated, for example, via the weekly meeting of the EU’s Political & Security Committee – would be severely disrupted from March 2019;
  • If the UK imposes sanctions under the Sanctions and Anti-Money Laundering Act 2018 which the EU-27 does not, that is likely to reduce their overall effectiveness (the Lords’ Report notes that “while informal engagement with the EU on sanctions… can be very valuable, it is no substitute for the influence that can be exercised through formal inclusion in EU meetings”); and
  • The Committee will continue to monitor the discussions on the UK’s future relationship with the EU closely, as well as consider any proposals for listings under the new chemical weapons sanctions framework, or for parallel sanctions regimes for human rights abuses or cyber-attacks.