The Iraq (Sanctions) (EU Exit) Regulations 2020
| Year | 2020 |
2020 No. 707
Exiting The European Union
Sanctions
The Iraq (Sanctions) (EU Exit) Regulations 2020
Made 7th July 2020
Laid before Parliament 9th July 2020
Coming into force in accordance with regulation 1(2)
The Secretary of State1, in exercise of the powers conferred by sections 1(1)(a) and (3)(a), 3(1)(a) and (d)(i), 5, 9(2)(b), 13, 15(2)(a), (2)(b), (3) and (6), 16, 17, 19, 20, 21(1), 54(1) and (2), 56(1) and 62(4) to (6) of, and paragraphs 2(b), 4(b), 5(a)(ii) and (b), 6(a)(ii) and (b), 13(h), (k), (l), (m) and (n), 16(a) and (b), 17(a), 20, 21 and 27 of Schedule 1 to, the Sanctions and Anti-Money Laundering Act 20182, and having decided, upon consideration of the matters set out in section 56(1) of that Act, that it is appropriate to do so, makes the following Regulations:
PART 1
General
Citation and commencement
1.—(1) These Regulations may be cited as the Iraq (Sanctions) (EU Exit) Regulations 2020.
(2) These Regulations come into force in accordance with regulations made by the Secretary of State under section 56 of the Act.
Interpretation
2. In these Regulations—
“the Act” means the Sanctions and Anti-Money Laundering Act 2018;
“arrangement” includes any agreement, understanding, scheme, transaction or series of transactions, whether or not legally enforceable (but see paragraph 12 of Schedule 1 for the meaning of that term in that Schedule);
“CEMA” means the Customs and Excise Management Act 19793;
“the Commissioners” means the Commissioners for Her Majesty’s Revenue and Customs;
“the Committee” means the Committee of the Security Council established in accordance with paragraph 1 of resolution 1518;
“conduct” includes acts and omissions;
“document” includes information recorded in any form and, in relation to information recorded otherwise than in legible form, references to its production include producing a copy of the information in legible form;
“the EU Iraq Regulation” means Council Regulation (EC) No 1210/2003of 7 July 2003, concerning certain specific restrictions on economic and financial relations with Iraq and repealing Regulation (EC) No 2465/964, as it has effect in EU law;
“resolution 661” means resolution 661 (1990) adopted by the Security Council on 6 August 1990;
“resolution 1483” means resolution 1483 (2003) adopted by the Security Council on 22 May 2003;
“resolution 1518” means resolution 1518 (2003) adopted by the Security Council on 24 November 2003;
“resolution 1956” means resolution 1956 (2010) adopted by the Security Council on 15 December 2010;
“trade licence” means a licence under regulation 36;
“Treasury licence” means a licence under regulation 35(1);
“United Kingdom person” has the same meaning as in section 21 of the Act.
Application of prohibitions and requirements outside the United Kingdom
3.—(1) A United Kingdom person may contravene a relevant prohibition by conduct wholly or partly outside the United Kingdom.
(2) Any person may contravene a relevant prohibition by conduct in the territorial sea.
(3) In this regulation, a “relevant prohibition” means any prohibition imposed by—
(a)
(a) Part 3 (Finance),
(b)
(b) Part 4 (Trade), or
(c)
(c) a condition of a Treasury licence or a trade licence.
(4) A United Kingdom person may comply, or fail to comply, with a relevant requirement by conduct wholly or partly outside the United Kingdom.
(5) Any person may comply, or fail to comply, with a relevant requirement by conduct in the territorial sea.
(6) In this regulation, a “relevant requirement” means any requirement imposed—
(a)
(a) by or under Part 6 (Information and records), or by reason of a request made under a power conferred by that Part, or
(b)
(b) by a condition of a Treasury licence or a trade licence.
(7) Nothing in this regulation is to be taken to prevent a relevant prohibition or a relevant requirement from applying to conduct (by any person) in the United Kingdom.
Purpose
4.—(1) The purpose of the regulations contained in this instrument that are made under section 1 of the Act is compliance with the relevant UN obligations.
(2) In this regulation, “the relevant UN obligations” means—
(a)
(a) the obligation that the United Kingdom has by virtue of paragraph 23(a) of resolution 1483 (partial asset-freeze)5to take the measures required by that provision in respect of persons for the time being named for the purposes of that provision by the Security Council or the Committee;
(b)
(b) the obligation that the United Kingdom has by virtue of paragraph 23(b) of resolution 1483 (asset-freeze) to take the measures required by that provision in respect of persons for the time being named for the purposes of that provision by the Security Council or the Committee;
(c)
(c) the obligations that the United Kingdom has by virtue of paragraph 23(b) of resolution 1483 in respect of persons—
(i) acting on behalf of or at the direction of, or
(ii) owned or controlled by,
the persons for the time being named by the Security Council or the Committee for the purposes of paragraph 23(b) of resolution 1483;
(d)
(d) the obligations that the United Kingdom has by virtue of paragraph 3 of resolution 661 (arms embargo);
(e)
(e) the obligations that the United Kingdom has by virtue of paragraph 7 of resolution 1483 (Iraqi cultural property).
PART 2
Designation of persons
Designation of persons named by or under UN Security Council Resolutions
5.—(1) Each person6for the time being named by the Security Council or the Committee as a person referred to in paragraph 23(a) of resolution 1483 is a designated person for the purposes of regulation 8 (partial asset-freeze in relation to the former Government of Iraq and its state bodies, corporations or agencies) (whose purposes include compliance with the UN obligations mentioned in regulation 4(2)(a)7).
(2) Each person for the time being named by the Security Council or the Committee as a person referred to in paragraph 23(b) of resolution 1483 is a designated person for the purposes of regulations 9 to 13 (asset-freeze etc. in relation to persons connected with the former Iraqi regime) (whose purposes include compliance with the UN obligations mentioned in regulation 4(2)(b)).
PART 3
Finance
CHAPTER 1
Interpretation
Meaning of “designated person” in Part 3
6.—(1) In regulation 8 (partial asset-freeze in relation to the former Government of Iraq and its state bodies, corporations or agencies) a “designated person” means a person who is designated for the purposes of regulation 8 by reason of regulation 5(1).
(2) In regulations 9 to 13 (asset-freeze etc. in relation to persons connected with the former Iraqi regime) a “designated person” means a person who is designated for the purposes of regulations 9 to 13 by reason of regulation 5(2).
Meaning of “owned or controlled directly or indirectly”
7.—(1) A person who is not an individual (“C”) is “owned or controlled directly or indirectly” by another person (“P”) if either of the following two conditions is met (or both are met).
(2) The first condition is that P—
(a)
(a) holds directly or indirectly more than 50% of the shares in C,
(b)
(b) holds directly or indirectly more than 50% of the voting rights in C, or
(c)
(c) holds the right directly or indirectly to appoint or remove a majority of the board of directors of C.
(3) Schedule 1 contains provision applying for the purpose of interpreting paragraph (2).
(4) The second condition is that it is reasonable, having regard to all the circumstances, to expect that P would (if P chose to) be able, in most cases or in significant respects, by whatever means and whether directly or indirectly, to achieve the result that affairs of C are conducted in accordance with P’s wishes.
CHAPTER 2
Partial asset-freeze
Partial asset-freeze in relation to the former Government of Iraq and its state bodies, corporations or agencies
8.—(1) A person (“P”) must not deal with relevant funds or economic resources owned, held or controlled by a designated person if P knows, or has reasonable cause to suspect, that P is dealing with such funds or economic resources.
(2) Paragraph (1) is subject to Part 5 (Exceptions and licences).
(3) A person who contravenes the prohibition in paragraph (1) commits an offence.
(4) For the purposes of paragraph (1), “relevant funds or economic resources” are funds or economic resources which were located outside Iraq on 22 May 2003.
(5) For the purposes of paragraph (1), a person “deals with” funds if the person—
(a)
(a) uses, alters, moves, transfers or allows access to the funds,
(b)
(b) deals with the funds in any other way that would result in any change in volume, amount, location, ownership, possession, character or destination, or
(c)
(c) makes any other change, including portfolio management, that would enable use of the funds.
(6) For the purposes of paragraph (1), a person “deals with” economic resources if the person—
(a)
(a) exchanges the economic resources for funds, goods or services, or
(b)
(b) uses the economic resources in exchange for funds, goods or services (whether by pledging them as security or otherwise).
(7) The reference in paragraph (1) to funds or economic resources that are “owned, held or controlled” by a person—
(a)
(a) includes, in particular, a reference to—
(i) funds or economic resources in which the person has any legal or equitable interest, regardless of whether the interest is held jointly with any other person and regardless of whether any other person holds an interest in the funds or economic resources;
(ii) any...
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