UK Weekly Sanctions Update - Week of March 25, 2024

In this weekly update, we summarise the most notable updates in the UK sanctions world. If you have any questions in respect of any of the developments set out below, please do not hesitate to contact a member of our London Global and Government Trade team listed above.

1. Russia Sanctions

• OFSI issues new General Licence for the wind down of transactions involving two Turkish shipping companies under the Russia Regulations: On March 28, 2024, OFSI issued General Licence INT/2024/4576632 authorising certain activities relating to two Turkish shipping companies, “Active Denizcilik” and “Beks Ships”, which are each UK asset freeze targets.  The general licence authorises inter alia the provision of insurance for the benefit of Active Denizcilik and the wind down of certain transactions involving “Active Denizcilik” or “Beks Ships” subject to the conditions specified in the general licence.  The general licence expires on June 11, 2024.  (Active_and_Beks_General_Licence_INT.2024.4576632.pdf (publishing.service.gov.uk)).
• UK High Court holds that a designated person has no rights of redemption in escrow sums: On March 27, 2024, in Abfa Commodities Trading Limited v Petraco Oil Company SA, the UK High Court held that the effect of its determination that VTB Commodities (now Adfa Commodities) had no rights or interests in a sum of money held by Afba Commodities Trading Limited’s solicitors to the order of the court (the ”secured sum”) was to extinguish any right of redemption of VTB Commodities in the secured sum.  The court therefore held that the secured sum was not “owned, held, or controlled” by a designated person within the meaning of Regulation 11 of the Russia (Sanctions) (EU Exit) Regulations 2019 given that the designated person had no "legal or equitable interest" in the secured sum.  (ABFA Commodities Trading Ltd v Petraco Oil Company SA (Re Consequential Matters) [2024] EWHC 706 (Comm) (27 March 2024) (bailii.org)).
• UK Government amends one entry on the UK sanctions list under the Russia regime: On March 27, 2024, the UK Government amended the entry for Svetlana Alexandra Krivonogikh on the UK sanctions list under the Russia sanctions regime. This individual remains subject to an asset freeze and trust services sanctions.  (Notice_Russia_270324.pdf (publishing.service.gov.uk)).

2. Cyber Sanctions

• UK Government adds three entries to the sanctions list under the Cyber regime: On March 25, 2024, the UK Government added two individuals and one entity to the UK sanctions list under the Cyber regime.  The sanctioned organisation, Wuhan Xiaoruizhi Science and Technology Company Ltd, is believed to be operating on behalf of the Chinese Ministry of State Security, acting in support of malicious cyber activity that targeted UK officials, government entities and parliamentarians.  The two individuals, Ni Gaobin and Zhao Guangzong, are Chinese nationals who are affiliated with the Wuhan company. All such entries are now subject to an asset freeze. (Notice_Cyber_250324.pdf (publishing.service.gov.uk)).

3. Counter-Terrorism Sanctions

• UK Government adds two entries to the sanctions list under the Counter-Terrorism (Domestic) regime: On March 27, 2024, the UK Government added two individuals, Aozma Sultana and Mustafa Ayash, to the UK sanctions list under the Counter-Terrorism (Domestic) regime.  Each individual is believed to be connected with Gaza Now, a news agency that allegedly promotes Hamas and Palestinian Islamic Jihad. (Notice_Counter_Terrorism__Domestic__270324.pdf (publishing.service.gov.uk); https://www.gov.uk/government/news/new-sanctions-on-persons-linked-to-hamas-supporting-media-network).

4. Other Sanctions

• UK Export Control Joint Unit (ECJU) amends the open general export license (OGEL) to take into account recent changes to Schedule 3 of the Export Control Order 2008: On March 26, 2024, the ECJU published Notice to Exporters 2024/05 stating that an OGEL for the export of dual-use items to EU member states will be updated with effect from 1 April 2024.  The updated OGEL will permit the export of items specified by three new entries set out in Schedule 3 of the Export Control Order 2008 (equipment relating to quantum technologies, cryogenic technologies, semiconductor technologies, additive manufacturing equipment and advanced materials) to inter alia  EU member states, Australia and the United States. (NTE 2024/05: open general export licence (export of dual-use items to EU member states) - GOV.UK (www.gov.uk)).
• UK updates guidance on how to request a review of terrorism designation: On March 27, 2024, the UK government updated its guidance on how to request variation or revocation of a financial sanctions under The Counter-Terrorism (Sanctions) (EU Exit) Regulations 2019.  The guidance includes inter alia details of who can apply for a review of their designation status, how to submit a sanctions review request form, and what evidence should be submitted to support such a request. (How to request variation or revocation of a financial sanction designation under The Counter-Terrorism (Sanctions) (EU Exit) Regulations 2019 - GOV.UK (www.gov.uk)).
• OFSI publishes survey on threats to financial sanctions compliance: On March 25, 2024, OFSI released a survey to gather industry perspectives and invite users to contribute to efforts in strengthening financial sanctions compliance.  The survey takes approximately 10 minutes to complete and is open until April 12, 2024, at 5pm. (OFSI Threat Assessment: Threats to Financial Sanctions Compliance in the UK (smartsurvey.co.uk)).