Sanctions Orders are extended by Statutory Instrument to the British Overseas Territories, including the British Virgin Islands and the Cayman Islands, to implement sanctions regimes implemented by the United Nations Security Council, the European Union and the United Kingdom Government ("Sanctions Orders").
Sanctions Orders apply to any person or body incorporated or instituted in the jurisdiction, as well as any British citizen or subject ordinarily resident in the jurisdiction. The Sanctions Orders generally restrain persons from dealing in funds or economic resources owned or controlled by, or making funds or economic resources available to, persons or entities listed under the Order.
Jurisdictions that are subject to Sanctions Orders containing asset or fund freezing provisions include Lebanon, Syria, Tunisia, Libya, Egypt, Belarus, Iran, Syria, Afghanistan, Eritrea, Zimbabwe, Somalia, Democratic People's Republic of Korea, Guinea-Bissau, Guinea, Ukraine, Central African Republic, South Sudan, Sudan, Yemen, Democratic Republic of Congo, Iraq, Burundi, Iran, Mali and Venezuela, and in respect of the ISIL (Da'esh) and Al-Qaida regimes ("Financial Sanctions Orders").
Among other requirements, these Financial Sanctions Orders impose an obligation on 'relevant institutions' to report to the Governor of the jurisdiction where they know or suspect a 'relevant person' may be listed or may have committed an offence under the Financial Sanctions Order. The definition of 'relevant institution' varies, but is typically defined as including a jurisdiction's financial regulator, licensed banks and credit unions or societies.
From 7 November 2018, pursuant to The Sanctions (Overseas Territories) (Amendment of Information Provisions) Order 2018, the reporting obligation in respect of Financial Sanctions Orders shall extend to 'relevant businesses and professions', including auditors, casinos, precious metal and stone dealers, external accountants, independent legal professionals, real estate agents, tax advisors and trust or company service providers.
A 'relevant person', in respect of a relevant business or profession, means:
(a) a customer of the relevant business or profession;
(b) a person who has been a customer of the relevant business or profession at any time on or after 7 November 2018; or
(c) a person with whom the relevant business or profession has had dealings in the course of business on or after that date.
Furthermore, a disclosure to the Governor must state:
(a) the information or other matter on which the knowledge or suspicion is based;
(b) any information the relevant institution / business or profession holds about the relevant person by which the person can be identified; and
(c) where the relevant person is a listed person, the nature and amount or quantity of any funds or economic resources held by the relevant institution / business or profession for that person since the person first became a listed person.
Failure to report is an offence under the Financial Sanctions Orders carrying penalties on summary conviction of imprisonment for up to three months, or a fine of up to £5,000 or its equivalent, or both. If an offence has been committed with the consent or connivance of, or due to neglect by, any director, manager, secretary or other similar officer of a body corporate, or any person purporting to act in such capacity, that person, as well as the body corporate, shall be guilty of that offence.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.