UK Issues New Guidelines for Trade Sanctions Licensing

Clarifying the Process for Obtaining a License

The UK has introduced new guidelines for trade sanctions licensing to clarify the process and requirements for obtaining a license to engage in certain trade activities that would otherwise be prohibited by regulations. The guidelines aim to provide clarity on how individuals or organizations can apply for a license from the Office of Financial Sanctions Implementation (OFSI) to use their funds or economic resources that have been frozen.

Eligibility Criteria

To be eligible for a license, applicants must meet certain criteria outlined in Schedule 2. This includes payments to satisfy judicial decisions made before May 22, 2003. The OFSI may need to notify or seek approval from relevant United Nations sanctions committees before issuing a license, which could lengthen processing times and potentially prevent licenses from being issued in some cases.

Licensing Grounds

The guidelines note that the Department for International Trade (DIT) is responsible for trade sanctions licensing. The Secretary of State for International Trade makes decisions on a case-by-case basis, taking into account specific activities that are likely to be consistent with the aims of the sanctions regime and international law obligations.

Overlap between Trade Sanctions and Financial Sanctions

The guidelines also highlight the overlap between trade sanctions and financial sanctions. Importers or exporters may need a license from OFSI in addition to a license from the DIT. It is essential for applicants to understand the requirements for both types of licenses to ensure compliance with regulations.

How to Apply

Applications for trade sanctions licenses can be made through SPIRE, with additional guidance available on how to make an export declaration via the National Export System (NES). The guidelines provide a step-by-step process for applying and highlight the importance of accurate and complete information to avoid delays or rejection.

The UK has also reminded exporters that they may need to submit electronic export declarations via NES, part of HMRC’s Customs Handling of Import and Export Freight (CHIEF) system. Guidance on making an export declaration is available online.

Full Guidelines Available

The full guidelines can be accessed on the government’s website, along with further information on trade sanctions licensing and financial sanctions targets.