The Sanctions and Anti-Money Laundering Bill (the “Bill”) is set to ensure that post-Brexit the UK is able to impose, update and lift sanctions and AML regimes. The House of Lords concluded its committee stage review last month and are set to apply further scrutiny to the Bill this week. Forming part of the Government’s campaign against money laundering and terrorism the Bill aims to create:
- compliance with the UK’s and to support our wider foreign policy and national security goals;
- stricter sanction regulations, particularly in the areas of financial sanctions, immigration, trade, aircraft and shipping;
- exceptions and licences to allow specific activities to take place that would otherwise be prohibited or restricted by sanctions;
- ministerial and judicial review processes granting individuals and organisations to challenge sanctions imposed on them; and
- updated provisions surrounding the UK’s approach to anti-money laundering and terrorist financing, particularly after the UK’s exit from the EU.
Sanctions
Brexit will require the UK government to establish new legal powers and the opportunity to establish domestic sanctions legislation; an area which is currently driven by EU regulations. The current drafting of the Bill will not require businesses to make significant changes to their internal processes but there will be further implementation required e.g. appropriate staff reading the new guidance and understanding their new responsibilities.
The Bill will require more members of prescribed groups and persons to adhere to sanctions regulations. Therefore, businesses newly caught by the regime will need to either create or review their existing sanctions policies. Those companies who are already subject to the EU regulations will want to take note of the Bill and later the Act and question whether their existing sanctions framework is suitable.
Anti-Money Laundering (“AML”)
While the Bill does not immediately impose any additional obligations on UK businesses, the Bill does empower Government to introduce new UK regulation in line with standards published by the Financial Action Task Force. Ministers would be able to both pass secondary legislation or amend and revoke existing AML regulations such as the recently enacted Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017.
We will be following the progression of the Bill through Parliament and provide regular updates on this article.
