New civil enforcement powers on trade sanctions
The Trade, Aircraft and Shipping Sanctions (Civil Enforcement) Regulations 2024 strengthens trade sanctions enforcement powers of the Department for Business and Trade.
Documents
Details
The UK government plans to launch the Office of Trade Sanctions Implementation (OTSI), within the Department for Business and Trade, in October 2024.
To equip the office with new civil enforcement powers, on 12 September 2024, the UK government laid a new Statutory Instrument in Parliament – The Trade, Aircraft and Shipping Sanctions (Civil Enforcement) Regulations 2024. These regulations were made under the Sanctions and Anti-Money Laundering Act 2018.
OTSI’s enforcement powers come into effect from 10 October 2024.
They will apply to:
-
all UK persons including businesses wherever they are in the world
-
any person including businesses in the UK or the UK territorial sea
Civil enforcement
OTSI will be responsible for the civil enforcement of certain trade sanctions as they relate to UK services and overseas trade with a UK nexus. The office will be able to impose monetary penalties, and where a civil monetary penalty can be imposed for a breach, breaches may be determined on a ‘strict liability’ basis. Penalties can be imposed on the basis of the civil standard of proof – the balance of probabilities.
The maximum monetary penalty for breaching sanctions regulations is either £1 million or 50% of the estimated value of the breach – whichever is higher. The regulations also provide OTSI with additional enforcement tools, such as making public disclosure of breaches.
Reporting and information requests
The regulations also introduce reporting obligations for relevant persons, and powers to request information. Failure to comply with either of these can amount to a criminal offence.
Further information
More detailed statutory guidance about these regulations, including the reviews and appeals process, can be found on OTSI’s gov.uk website.
The full regulations and the accompanying explanatory memorandum can be found on legislation.gov.uk.