In January 2020, the UK officially left the European Union and moved into a transition period. During this period, all EU legislation, including sanctions, has continued to apply to the UK. At the end of 31st December 2020 at 11 pm, the UK will no longer be under EU sanctions and instead have its own legislation. So, what do affected businesses need to know as we approach the end of the year?
As of 1st January 2021, UK sanctions will come into force under the Sanctions and Anti-Money Laundering Act (SAMLA) 2018. The UK will publish a UK sanctions list, including Sanctions Act UK designations at the end of the transitional period (31.12.2020). The UK sanctions will apply automatically not just to those listed but to entities more than 50% owned or controlled by listed entities.
The UK’s sanctions regulations include:
- the purposes of the sanctions regime (what the UK hopes will be achieved through imposing sanctions)
- the criteria for sanctions to be imposed on a person or entity
- the type of sanctions, such as trade and financial sanctions
- details of exemptions that may apply, such as exemptions that allow people to trade with a particular country that would otherwise be prohibited by the regulations
- how the government will enforce sanctions
- other rules, such as circumstances in which information about sanctions may be shared
There may be specific exceptions under which it is possible to engage in an activity that would otherwise be prohibited. It may also be possible to get a license that would permit you to engage in an activity that would otherwise be prohibited. See below.
Impact on your organisation
Consequences of sanctions can be grave for global financial institutions and businesses. Deliberately breaching sanctions, or engaging in activities designed to circumvent sanctions, are a serious criminal offence which can also affect the executives of the organisation.
- Individuals and entities are advised to assess the nature of their business activities, including products, services, supply chains, and the jurisdictions where they operate, to determine their exposure and devise an appropriate compliance framework.
- This framework must be robust and able to respond quickly to changes in the sanctions landscape.
EBII group can support your organisation through our custom online, virtual, and or in-house sanctions training. Contact us for further support.