On this page you will find background on sanctions issues and information about the administration of Guernsey's sanctions regime.
For information on the sanctions regimes which are in place follow this link. Updates on new sanctions regimes and changes to existing regimes are available here, including changes to designations which are uploaded on the website as soon as they are made.You can also find out more information from this frequently asked questions document [283kb]. The UK Office of Financial Sanctions Implementation at HM Treasury has also issued an FAQ document on sanctions which is available by following this link and the UK Financial Conduct Authority has issued guidance on financial crime that includes sanctions which is available by following this link. These documents are not binding on the Guernsey authorities but they may take them into account when considering any question of implementation within the Bailiwick.
The United Nations and the European Union are key bodies that adopt sanctions measures. In addition, as a result of the United Kingdom leaving the European Union, the UK now enacts its own sanctions measures. These measures may be autonomous sanctions regimes or may implement a UN sanctions regimes. UK autonomous sanctions regimes that replace corresponding EU sanctions regimes are broadly similar to, but not identical to, those EU regimes. Sanctions may implement the following measures:
- Financial sanctions including asset freezes and investment bans
- Travel bans
- Import and Export bans
- Arms embargo
- Trade restrictions
- The Bailiwick implements all types of international sanctions.
- Travel bans are implemented administratively under the Immigration Act 1971, as extended to the Bailiwick by the Immigration (Guernsey) Order 1993, rather than under specific sanctions legislation.
- Arms embargoes and related export restrictions are principally implemented in the Bailiwick under general export control legislation rather than by specific sanctions legislation (although there may be an overlap with Guernsey's specific sanctions legislation in cases where this includes certain import and export restrictions). The relevant legislation is the Export Control (Military, Security, and Related Matters) (Bailiwick of Guernsey) Order, 2010. This Order expressly mirrors and incorporates restrictions under the UK's Export Control Order 2008 and any changes made under the UK Order are automatically effective under the Guernsey Order. The Committee for Home Affairs, through the Guernsey Border Agency, is the competent authority for any import or export licensing matters. Further information about the restrictions in place under export control legislation is available by following this link.
- All other forms of sanctions, including regime-specific sanctions, are implemented in the Bailiwick under the Sanctions (Implementation of UK Regimes) (Bailiwick of Guernsey) (Brexit) Regulations, 2020 (the 2020 regulations). The 2020 regulations give effect in the Bailiwick to sanctions regimes enacted by the UK under the Sanctions and Anti-Money Laundering Act 2018 (the SAML Act). Further details are set out in the section on Brexit below.
- It is the responsibility of each individual or institution to comply with the relevant legislation and failure to comply is a criminal offence.
- It is important to note that changes to sanctions measures are automatically effective under the 2020 regulations. These changes may involve the addition of further prohibitions or, more commonly, the adding or removing of names from lists of designated persons or entities targeted by a particular sanctions regime. It is particularly important to be aware that where a UN list is incorporated into a UK sanctions regime that has been implemented in the Bailiwick under the 2020 regulations, any additions to the UN list are automatically effective domestically. Therefore, in order to be aware of the full scope of sanctions under a UK sanctions regime or UN Security Council Resolution at a particular time, all amendments made to the UK sanctions regime or Resolution in question up to that time must be taken into account.
- As a result of Brexit, the UK has introduced the Sanctions and Anti-Money Laundering Act 2018 (the SAML Act), under which it both gives effect to UN sanctions and enacts its own autonomous sanctions regimes instead of, as previously, implementing sanctions via EU Regulations.
- The Bailiwick's policy is to ensure that the sanctions regime applicable domestically continues to mirror that in the UK. Therefore, a number of legislative steps to achieve this have been put in place. First, under the Sanctions (Bailiwick of Guernsey) Law, 2018, the Policy & Resources Committee has enacted the Sanctions (Implementation of UK Regimes) (Bailiwick of Guernsey) (Brexit) Regulations, 2020 ( the 2020 regulations), which came into force on 31st December 2020. The 2020 regulations give effect to all of the UK sanctions regimes under the SAML Act to date, and repeal the Ordinances giving effect to corresponding EU sanctions measures. They also contain transitional provisions which specify that any licences or licence applications in existence as at 31st December 2020 are deemed to have been made under the 2020 regulations (subject to any applicable restrictions or conditions in the case of existing licences). The 2020 regulations will be amended to add any future sanctions that may be enacted by the UK under the SAML Act as they come into force.
- Second, the Sanctions (Bailiwick of Guernsey) Law, 2018 has been amended to repeal provisions that gave interim effect to UN sanctions measures before they had been adopted by the EU. Interim provision of this kind is no longer necessary, as changes to UN measures are automatically effective under the UK sanctions regimes that implement them, and therefore are automatically effective in turn under the 2020 regulations.
- Third, the definition of designated person under the Terrorist Asset Freezing (Bailiwick of Guernsey) Law, 2011, has been amended. It previously included persons designated by the UK under the Terrorist Asset Freezing etc. Act, 2010 or by the EU under a specific terrorism-related sanctions regime. The definition of designated person now only covers persons designated by the Policy & Resources Committee. This reflects the fact that in the UK, designations under the UK Act and the EU regulation have been replaced by two dedicated terrorist asset-freezing regimes under the SAML Act, and those regimes are implemented in the Bailiwick by the 2020 regulations.
- Under the Sanctions (Bailiwick of Guernsey) Law, 2018, there are specific reporting obligations applicable to businesses that are subject to the Bailiwick's regime for countering money laundering and terrorist financing. Further information is available here: guidance on reporting obligations [262kb]. In addition, the UK sanctions regimes implemented in the Bailiwick are subject to particular reporting obligations which in some cases are generally applicable. These obligations vary depending on the regime in question, but they primarily relate to financial restrictions. Details of the applicable reporting obligations are available by following this link.
- The Bailiwick's position as a leading international financial sector means that financial restrictions are the most likely to be relevant to businesses in this jurisdiction. As well as comprehensive prohibitions on dealing with sanctioned countries and their governments, financial restrictions include targeted measures such as asset freezes and prohibitions on providing specific financial services or making funds or other economic resources available to designated individuals or entities. Generally speaking, any person who fails to treat as frozen all accounts, funds or economic resources belonging to, owned, held or controlled by a designated person, entity, body or group, or who makes any funds, economic resources (or, in some circumstances, financial or technical assistance) available directly or indirectly to or for the benefit of designated persons, is guilty of an offence unless the transaction in question has been licensed (see section on licences below).
- It is important to be aware that asset freezes and prohibitions on making funds or economic resources available apply irrespective of whether the relevant assets are held solely by a designated person or are held jointly with a third party, and they extend to interest and other assets that are derived from the assets subject to an asset freeze.
- Changes to the lists of designated persons or entities targeted by a particular UK sanctions regime (whether this is an autonomous UK regime or implements a United Nations Security Council Resolution) are automatically effective in Guernsey. They are incorporated into lists maintained by HM Treasury when they are made by the appropriate designating body. As well as regime -specific lists, HM Treasury maintains a consolidated list of designated persons under all regimes. It is the responsibility of each individual or institution to familiarise itself with changes to designations by checking these lists.
- Regime-specific and consolidated lists of financial sanctions targets can be found on the HM Treasury website.
- A licence is a written authorisation from a named competent authority to allow an activity which would otherwise be prohibited by sanctions measures.
- Under the Sanctions (Implementation of UK Regimes) (Bailiwick of Guernsey) (Brexit) Regulations, 2020 ( the 2020 regulations), the Bailiwick competent authority for licences in respect of financial services and related matters is the States of Guernsey Policy & Resources Committee. The Policy & Resources Committee is also the competent authority under the Terrorist Asset - Freezing (Bailiwick of Guernsey) Law, 2011. The Bailiwick competent authority for trade licences (i.e. licences related to matters such as import or export and shipping) is the States of Guernsey Committee for Home Affairs.
- There are record keeping obligations relating to licences under the UK sanctions regimes that are implemented by the 2020 regulations and are therefore also applicable in the Bailiwick.
- All applications for licences should be addressed to the Regulatory and Financial Crime Policy Team of the Policy & Resources Committee in the first instance. Further information on licence applications in relation to financial sanctions is available to download here [258kb].
Unfreezing and De-Listing
- It may sometimes happen that assets are frozen in the belief that they are linked to a designated person when that is not in fact the case. The Policy & Resources Committee may assist with unfreezing any assets in the Bailiwick to which this applies, provided that it is satisfied that the assets are not linked to a designated person.
- The Policy & Resources Committee may also assist with requests to be removed from a list of designated persons in appropriate cases. The Policy & Resources Committee may vary or revoke its own designations made under the Terrorist Asset Freezing Law, if satisfied that it is appropriate to do so. In addition there is a right of appeal against decisions as to designations made by the Policy & Resources Committee under section 24 of the Terrorist Asset Freezing Law. This is available to any person who is aggrieved by a particular decision, not just to the designated person.
- The Policy & Resources Committee cannot amend or revoke designations made by other designating authorities such as the UN, the EU or the UK, but it may be able to assist a listed person within the Bailiwick in dealing with the relevant designating authority.
- Any queries in respect of unfreezing or de-listing should be sent in writing by email or post to the address below.
- De-listing requests or challenges may also be addressed directly to the relevant designating authority as follows:
- United Nations - any person who wishes to be removed or delisted from the United Nations Al-Qaida and Taliban list or other UN sanctions listing can access the United Nations focal point for delisting and obtain further information here.
- Alternatively a person may petition his or her state of residence or citizenship. British citizens should send the petition with the details specified by the UN to:
- Foreign and Commonwealth Office
King Charles Street
- European Union - requests to be removed from listings under EU Regulations may be sent to firstname.lastname@example.org
- HM Treasury - there is a right of appeal against designations under section 26 of the Terrorist Asset Freezing etc Act 2010. The address for service of legal correspondence for the Treasury is:
- The Treasury Solicitor's Department
One Kemble Street
- Phone: 020 7210 3000.
- DX number: 123242 Kingsway.
- In addition, under Chapter 4 of the Sanctions and Anti-Money Laundering Act 2018, there is a right to a court review of any ministerial decisions on designations.
Relationship to Other Jurisdictions
- Although the Bailiwick's sanctions regime operates independently, trans-jurisdictional issues may arise at times. Many transfers of funds will be made to or from another jurisdiction that operates a sanctions regime and in such cases a licence may be required in both jurisdictions. unless there are specific measures in place to recognise a licence issued by the other jurisdiction. This is the case in the UK, which under its sanctions regimes recognizes licences issued by the Crown Dependencies or the Overseas Territories; as implemented in the Bailiwick, this recognition also includes licences issues by the UK.
- In addition, the legislative frameworks of some jurisdictions contain provisions that are expressed to have extra-territorial effect, so that they may apply to some of the parties involved in a Bailiwick transaction on the grounds of nationality or place of incorporation even if the jurisdiction in question is not involved in that transaction.
EU Sanctions and United States Sanctions (OFAC)
- Businesses in Guernsey should be aware of autonomous sanctions implemented by the European Union, or in the USA by the Office of Foreign Assets Control (OFAC).
- EU sanctions apply to nationals of member states and any activity within a member state.
- OFAC regulations can be applied to:
- U.S. citizens and permanent residents regardless of where they are located.
- Persons and entities within the United States.
- Persons and entities trading in U.S. Dollars
- U.S. incorporated entities and their foreign branches.
- In the cases of certain sanctions, such as those regarding Cuba and North Korea, all foreign subsidiaries owned or controlled by U.S. companies.
- Foreign persons in possession of U.S. origin goods in some cases
Administration of Sanctions Matters in Guernsey
- The Sanctions Committee was established to co-ordinate sanction activities, to ensure information is distributed publicly and to provide advice on sanctions. It reports to the Policy & Resources Committee and the Bailiwick's AML/CFT Advisory Committee.
- The Sanctions Committee comprises members from the Regulatory and Financial Crime Policy Team of the Policy & Resources Committee, the Law Officers Chambers, the Guernsey Financial Services Commission, the Guernsey Border Agency, the Alderney Gambling Control Commission and the States of Alderney. Sark is also regularly kept informed of any sanctions related matters.
- The Policy & Resources Committee is mandated to:
- agree to implement new sanctions measures
- license frozen funds
- administer notifications and authorisations, e.g. those under The Iran (Restrictive Measures) (Guernsey) Ordinance, 2012.
- The Policy & Resources Committee also works with HM Treasury and the Foreign and Commonwealth Office.
For more information, use the following links:
- HM Treasury - UK consolidated list of financial sanctions targets.
- Department for Business Innovation and Skills - UK sanctions and export controls by country.
- Foreign & Commonwealth Office - UK policy and guidance.
- European Union - sanctions policy.
- GFSC - Guernsey Financial Services Commission.
- U.S. Treasury Department - Office of Foreign Assets and Control.
- EUR-Lex - search for consolidated EU Regulations.