The Ukraine (Sanctions) (Overseas Territories) Order 2014 (SI 2014/497)

Summary

This is a UK Order in Council extending an asset freeze sanctions regime to specified Overseas Territories (including the Cayman Islands, BVI and others listed in Schedule 1) targeting individuals identified as responsible for misappropriation of Ukrainian state funds. It creates criminal offences for dealing with or making available funds or economic resources to designated persons, and imposes reporting duties on financial institutions.

• Asset freeze: It is an offence to deal with funds or economic resources belonging to, or owned, held or controlled by, a designated person, or to make funds or economic resources available to or for the benefit of a designated person, where the person knows or has reasonable cause to suspect this.
• Reporting duty: A relevant institution (deposit taker or building society type body) must inform the Governor as soon as practicable if it knows or suspects a customer is a designated person or has committed an offence under the Order, providing specified identifying and account information.
• Designated persons list: The Governor must publish and keep up to date a list of designated persons (set out in Schedule 4), which currently names 18 individuals connected to the former Ukrainian government.
• Licensing regime: The Governor, with the Secretary of State's consent, may grant licences authorising otherwise-prohibited dealings (e.g. basic expenses, legal fees, extraordinary expenses); false statements to obtain a licence are themselves an offence.
• Circumvention offence: It is an offence to intentionally participate in activity knowing its object or effect is to circumvent or facilitate contravention of the freezing prohibitions.

Breaches carry significant criminal penalties, including up to seven years' imprisonment on indictment for freezing offences, and up to two years for reporting or licence-related offences. The Order applies to persons in the territory, relevant British nationals ordinarily resident there, bodies incorporated under territory law, and persons aboard territory-registered ships or aircraft.

Key obligations

• Persons must not deal with funds or economic resources belonging to, or owned, held or controlled by, a designated person where they know or have reasonable cause to suspect this.
• Persons must not make funds or economic resources available, directly or indirectly, to a designated person or for their benefit.
• Relevant institutions must inform the Governor as soon as practicable if they know or suspect a customer is a designated person or has committed an offence under article 4 or 7(10), including specified identifying details.
• Relevant institutions must inform the Governor as soon as practicable if they credit a frozen account under permitted exceptions (interest, pre-existing contractual payments, or incoming transfers).
• The Governor must publish a list of designated persons and keep it up to date.
• Persons must not participate in activity intended to circumvent or facilitate contravention of the freezing prohibitions.
• Any person seeking a licence to conduct otherwise-prohibited activity must not make false statements or provide false documents/information to obtain it.

Applies to

relevant institutions (deposit-taking institutions and building-society-type bodies), designated persons, any person in the territory, British citizens/overseas territories citizens ordinarily resident in the territory, bodies incorporated under the law of the territory, persons aboard territory-registered ships or aircraft

Deadlines

• 7th March 2014: Date the Order comes into force.
• as soon as practicable: Deadline for a relevant institution to inform the Governor upon knowing or suspecting a customer is a designated person, has committed an offence under article 4 or 7(10), or upon crediting a frozen account under permitted exceptions.
• 12 months from first entering the Territory after committing the offence: Time limit for instituting summary proceedings for an offence alleged to have been committed outside the Territory.

Related documents

• The Ukraine (Sanctions) (Overseas Territories) (No. 2) Order 2014 (S.I. 2014/1100) repeals this document
• The Ukraine (Sanctions) (Overseas Territories) (No. 2) Order 2014 (S.I. 2014/1100) replaces this document