UK amends Russia (Sanctions) (Overseas Territories) Order 2023 – as relevant to trust services
On 9 March 2023, the UK published the Russia (Sanctions) (Overseas Territories) (Amendment) Order 2023 (the Amendment). The Amendment further harmonises in the UK’s Overseas Territories (UKOTs) the implementation of the restrictions and safe-harbours on the provision of trust services, which were previously added to the UK’s Russia sanctions regime (including the UKOTs) in December 2022. For more on this please see our December 2022 post, referenced below.
In detail, the Amendment amends the Russia (Sanctions) (Overseas Territories) Order 2020, which itself extends with modifications the Russia (Sanctions) (EU Exit) Regulations 2019 (the Russia Sanctions Regulations) to the UKOTs, including the BVI and Cayman Islands. An equivalent regime is given effect to by local laws in Bermuda.
The Amendment harmonises the UKOT regime with the UK regime by clarifying certain safe-harbours to the sanctions on trust services, namely that regulation 18C (trust services) is not contravened by any act done by a person (P):
- In satisfaction of an obligation in respect of the provision of trust services by P to the benefit of a designated person or a person connected with Russia, where those services are provided in relation to the discharge of or compliance with a statutory or regulatory obligation of the UKOT
- For the purposes of complying with the prohibitions and obligations in Chapter 1 of Part 3 (asset freeze etc)
- In connection with transferable securities or money-market instruments where dealing with such securities or instruments is not prohibited by regulation 16 or 18B
Further, the prohibitions in regulation 18C are not contravened by the provision of trust services in certain specific cases (such as in the case of amateur sport clubs, charitable services, mandatory client accounts for securities and investment business, escrow as well as others). However the services must not be provided primarily to, or for the benefit of, a designated person or a person connected with Russia.
The Russia (Sanctions) (Overseas Territories) (Amendment) Order 2023 can be found here.
Our blog post on the Russia (Sanctions) (EU Exit)(Amendment) (No. 17) Regulations 2022 can be found here.
The Russia (Sanctions) (Overseas Territories) Order 2020 can be accessed here.
Our ongoing blog post on the various packages of UK sanctions on Russia can be found here.