The Policing and Crime Act (Financial Sanctions) (Overseas Territories) Order 2017 (S.I. 2017/984)

Summary

This is a UK Order in Council made under the Policing and Crime Act 2017 that extends the UK's financial sanctions framework to a list of British Overseas Territories, including the Virgin Islands and the Cayman Islands. It is enabling/framework legislation rather than a stand-alone sanctions list: it extends specific UK statutory mechanisms (linking of UN Security Council designations to EU sanctions regulations, automatic temporary listing, and temporary sanctions regulations made by HM Treasury) so that they take direct legal effect in the territories, with modifications for local application.

• What is extended now: From 2 November 2017, the UN and EU Financial Sanctions (Linking) Regulations 2017 and section 155 of the Act (automatic temporary listing of persons designated by new UN Security Council Resolutions) apply in the territories, so UN designations can take immediate legal effect there.
• What is extended later: Articles 7 to 14 (the detailed modifications for any future Temporary Regulations made under section 152(1) of the Act implementing a new UN sanctions regime) only come into force once the Treasury first makes such regulations.
• Modifications for the territories: References to HM Treasury are read as references to the Governor (except UN Security Council notifications); references to UK courts, judicial decisions and offences are read as references to the equivalent Territory court, decisions and offences; the Governor cannot grant, vary or revoke sanctions licences without the Secretary of State's consent.
• Relevant institutions defined: For these purposes a relevant institution includes any person lawfully accepting deposits in or from the Territory, certain residential-loan societies, and any undertaking operating a currency exchange, money transmission service, or cheque-cashing business by way of business.
• Penalties and time limits: Sets default maximum penalties on summary conviction (up to 6 months imprisonment or a fine up to £5,000, or both, unless the territory is one of the specified exceptions) and allows summary proceedings for offences committed abroad to be brought within 12 months of the accused first entering the Territory.
• Expiry of temporary regimes: Any Temporary Regulations extended to the territories cease to have effect on the earlier of an Order in Council implementing the relevant UN Resolution entering into force, or 120 days after that Resolution's adoption.

In practice, this Order is the legal mechanism by which UK financial sanctions arising from new UN Security Council Resolutions become enforceable in the Cayman Islands and other listed territories; it does not itself name any sanctioned persons but activates the machinery (licensing, offences, penalties, court jurisdiction) once such measures are made.

Key obligations

• Persons and bodies within the territories (including deposit-taking institutions, residential loan societies, and currency exchange, money transmission or cheque-cashing businesses) become subject to any UN-linked or temporary financial sanctions regime extended under this Order and must comply with the prohibitions it imposes once such regulations take effect.
• The Governor may not grant, vary or revoke a sanctions licence under Temporary Regulations without the prior consent of the Secretary of State in each case.
• Monetary penalties collected by the Governor under Temporary Regulations must be paid into the Territory's Consolidated Fund or an equivalent public fund.
• Summary proceedings for offences committed outside the Territory under Temporary Regulations must be instituted within 12 months of the accused first entering the Territory.

Applies to

relevant institutions (deposit-taking businesses), residential loan/building societies, money service businesses (currency exchange, money transmission, cheque cashing), persons and bodies subject to UN or EU financial sanctions designations, Governor and public authorities of the Territory

Deadlines

• 2nd November 2017: Articles 1 to 6 of the Order (including extension of the UN/EU Financial Sanctions Linking Regulations 2017 and section 155 temporary listing) come into force.
• the day that regulations made under section 152(1) first come into force: Articles 7 to 14 of the Order (the detailed modifications for Temporary Regulations) come into force.
• 120 days after the day the relevant UN financial sanctions Resolution is adopted: Default date on which Temporary Regulations extended to the territories cease to have effect, unless superseded earlier by an Order in Council implementing the Resolution.
• 12 months beginning with the date the person charged first enters the Territory: Time limit for instituting summary proceedings for an offence under Temporary Regulations allegedly committed outside the Territory.