Understanding the sanctions regime—a guide for businesses [Archived]

The following Risk & Compliance practice note provides comprehensive and up to date legal information covering:

  • Understanding the sanctions regime—a guide for businesses [Archived]
  • What are sanctions and who imposes them?
  • Sanctions and Brexit
  • Administration and enforcement
  • Financial sanctions
  • Trade sanctions
  • Offences and penalties
  • Key elements of the sanctions regimes
  • Asset freezes
  • Lists
  • More...

Understanding the sanctions regime—a guide for businesses [Archived]

ARCHIVED: This Practice Note has been archived and is not maintained.

This Practice Note explains what trade and financial sanctions are and who imposes them, how sanctions are administered and enforced, brief details of related offences and penalties, key concepts and how the financial sanctions regime is different from the anti-money laundering (AML) regime.

What are sanctions and who imposes them?

Sanctions are non-permanent international restrictions or prohibitions aimed at:

  1. encouraging a change in the behaviour of a particular country or regime

  2. applying pressure on particular countries or regimes to comply with certain objectives

  3. preventing and suppressing terrorist financing

They are also used as a last-resort enforcement tool when international peace and security has been threatened.

A designated person, entity or regime subject to sanctions that are effective in the UK is known as a target.

There are various different types of sanctions. They can range from comprehensive economic and trade sanctions to more targeted measures such as arms embargoes, travel bans, or financial or diplomatic restrictions. Financial sanctions can include the prohibition of funds transfers to certain countries, individuals or entities.

Sanctions are commonly described as either trade sanctions or financial sanctions. The distinction is relevant in terms of who applies and enforces the sanctions. In broad terms:

  1. financial sanctions are measures which restrict dealings in money and the provision of financial services

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