Align or divide? The road to the UK Sanctions Policy 2021

The UK government released official guidance on its sanctions policy after December 31, 2020 – the date marking the official end of the Brexit Transition Period. You can find the official guidance published by the UK government on January 31, 2020 here. 

The essence of this notification and what it means for UK companies involved in trading controlled items and dual-use goods (including technology transfers) across UK borders is summarized below. If the UK sanctions list and embargoes are relevant for you but you do not have a compliance program or an export controls solution in place, current key points of concern include: 

1. The unknown scope of future alignment and deviation from EU sanctions 
2. The uncertain scope of impact on UK government resources for self-governance in all areas of export controls, sanctions, and embargoes 
3. The uncertain scope of impacts on businesses for process change management for initial adoption and future sanctions programs . 

If you are already using AEB solutions for your Import Filing, Export Filing, Broker Integration and Export Controls, you are set up to receive relevant updates on Brexit from our service teams. And please contact us if you would like to discuss your individual software requirements to prepare and further automate your cross-border trade. 

Applicable as of 11pm on December 31, 2020 (after the Transition Period):

• EU sanctions will no longer apply in the UK after this date and time
• UK sanctions regimes will come into force under the Sanctions and Anti-Money Laundering Act 2018 (the Sanctions Act) from this date and time forward
• The UK government has already laid legislation before Parliament through the Sanctions Act
• There will be no gaps in implementing existing sanctions regimes after the transition period

What if?

Some EU sanctions regimes may not be addressed through regulations under the Sanctions Act by December 31, 2020?

• These will continue as retained EU law under the EU (Withdrawal) Act 2018

The UK’s sanctions regulations include:

1. The purposes of the sanctions regime (what the UK hopes will be achieved through imposing sanctions)
2. The criteria for sanctions to be imposed on a person or entity
3. The type of sanctions, such as trade and financial sanctions
4. Details of exemptions that may apply, such as exemptions which allow people to trade with a certain country that would otherwise be prohibited by the regulations
5. How the government will enforce sanctions
6. Other rules, such as circumstances in which information about sanctions may be shared

The government will publish the names of sanctioned people or entities and will keep the business community posted with further guidance once new regulations are published.

It is further to note that:

• The UK government will implement UN sanctions in UK domestic law after the transition period
• Traders cannot rely on the assumption that all aspects of existing EU sanctions will be exactly the same in future
• If the UK has not yet made UK regulations to replace an EU sanctions regime by 11pm on 31 December 2020, traders should refer to any EU Council Regulations retained under the EU Withdrawal Act 2018, which may have been modified by regulations made under that Act
• The Foreign & Commonwealth Office will publish further guidance on sanctions at the end of the transition period

In case of questions, traders can contact the Office for Financial Sanctions Implementation for financial sanctions, and the Export Control Joint Unit for trade sanctions.