Financial Sanctions and Export Controls

Financial sanctions generally come in three forms: targeted asset freezes applied to named individuals; generalised restrictions on access to financial markets and services or directions to cease all business of a specified type with a specific person, group, sector or country. 

Restrictions may include a requirement to notify or seek the consent of HM Treasury (HMT) before receiving money from certain countries (such as Iran). The legislation is deliberately drawn widely and, in some cases, prohibits financial institutions and individuals from dealing in any way with the funds or assets of a designated person. Sanctions may also be applied to direct and indirect investment by companies as well as the provision of goods and technologies.

Sanctions regimes typically enable certain specified transactions to take place in relation to frozen assets or resources, which would otherwise be prohibited, where an appropriate authority grants a licence authorising that transaction. For example, asset freezes imposed under EU legislation generally permit licences to be issued in order to provide for the basic needs of the designated person and dependent family members and for the payment of reasonable legal fees and disbursements. 

There are serious consequences for entities that breach sanctions. The financial sanctions regime requires absolute compliance to avoid the risk of prosecution. Criminal liability arises under UK law if sanctions are breached by designated entities or by individuals or companies transacting with prohibited entities or receiving money without notifying or seeking authorisation from HMT. There are current proposals to increase the level of penalties in this area.  

We can advise you in the event of a criminal investigation or prosecution for a breach. For individuals who have been made the subject of sanctions or restrictive measures we can provide assistance in making an application to have these restrictions removed or to obtain a licence authorising the use of frozen funds from HMT.

Export Control Enforcement proceedings

We also represent companies and individuals regarding trade control issues, in particular with regard to the risk of enforcement action or a criminal investigation for breaches of export or import controls.

Certain strategic goods require an export licence.

Whether or not an export licence is required is determined by four factors, as follows:

  1. nature of the goods due to be exported
  2. destination concerned
  3. ultimate end use of the goods
  4. licensability of trade activities of the goods to be exported

Strategic goods include military goods and a wide range of “dual use” goods (civilian goods with a potential military purpose). The British Government regulates the export and trade in military equipment and “dual use” goods.

The Export Control Office (ECO) at the Department for International Trade is the licensing authority for strategic exports in the UK.  It sets out the regulatory framework under which licence applications are made and considered.

HM Revenue and Customs (HMRC) has responsibility for the enforcement of export and trade controls as well as for sanctions and embargoes. HMRC works with Border Force to prevent, detect and investigate breaches. There is escalating scrutiny of exporters and brokers along with increased enforcement action.  This enforcement action can result in prison sentences, severe fines and confiscation of any income deemed to be the proceeds of crime.  

Criminal prosecutions are undertaken by the Central Fraud Group within the Crown Prosecution Services (CPS).

We have considerable experience of HM Revenue and Customs investigations and the related CPS prosecutions into breaches of export control legislation, the effect of which can be damaging to both individuals and businesses. We will provide quality assistance to you, protecting your rights and interests, to get you the best possible result.

Louise Hodges, Jonathan Grimes, Alun Milford and Nicola Finnerty. All are so much more than just white-collar specialists; they are true criminal litigators who know the system inside out, are well connected in the industry and government, understand how commercial interests intersect with criminal law"

Legal 500 UK 2022

I know Jonathan Grimes' work mainly in the field of international criminal law, where he is also a leading figure – hugely committed to his clients, and with a deeper interest in the development of this area of law generally."

Legal 500 UK 2022

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