Sanctions and Anti-Money Laundering Bill (HC Bill 176)

Sanctions and Anti-Money Laundering BillPage 40

(c) publicly and privately traded securities and debt instruments,
including stocks and shares, certificates representing securities, bonds,
notes, warrants, debentures and derivative products;

(d) interest, dividends and other income on or value accruing from or
5generated by assets;

(e) credit, rights of set-off, guarantees, performance bonds and other
financial commitments;

(f) letters of credit, bills of lading and bills of sale;

(g) documents providing evidence of an interest in funds or financial
10resources;

(h) any other instrument of export financing.

(2) In this Act “economic resources” means assets of every kind, whether tangible
or intangible, movable or immovable, which are not funds but can be used to
obtain funds, goods or services.

(3) 15In this Act references to “freezing” funds are to preventing funds from being
dealt with; and for the purposes of this subsection funds are “dealt with” if—

(a) they are used, altered, moved, or transferred or access is allowed to
them,

(b) they are dealt with in any other way that would result in any change in
20volume, amount, location, ownership, possession, character or
destination, or

(c) any other change is made that would enable their use, including
portfolio management.

(4) In this Act references to “freezing” economic resources are to preventing
25economic resources from being dealt with; and for the purposes of this
subsection economic resources are “dealt with” if—

(a) they are exchanged for funds, goods or services, or

(b) they are used in exchange for funds, goods or services (whether by
being pledged as security or otherwise).

54 30Meaning of “financial services” and “financial products”

(1) In this Act “financial services” means any service of a financial nature,
including (but not limited to)—

(a) insurance-related services consisting of—

(i) direct life assurance;

(ii) 35direct insurance other than life assurance;

(iii) reinsurance and retrocession;

(iv) insurance intermediation, such as brokerage and agency;

(v) services auxiliary to insurance, such as consultancy, actuarial,
risk assessment and claim settlement services;

(b) 40banking and other financial services consisting of—

(i) accepting deposits and other repayable funds;

(ii) lending (including consumer credit, mortgage credit, factoring
and financing of commercial transactions);

(iii) financial leasing;

(iv) 45payment and money transmission services (including credit,
charge and debit cards, travellers’ cheques and bankers’ drafts);

(v) providing guarantees or commitments;

Sanctions and Anti-Money Laundering BillPage 41

(vi) financial trading (as defined in subsection (2));

(vii) participating in issues of any kind of securities (including
underwriting and placement as an agent, whether publicly or
privately) and providing services related to such issues;

(viii) 5money brokering;

(ix) asset management, such as cash or portfolio management, all
forms of collective investment management, pension fund
management, custodial, depository and trust services;

(x) settlement and clearing services for financial assets (including
10securities, derivative products and other negotiable
instruments);

(xi) providing or transferring financial information, and financial
data processing or related software (but only by suppliers of
other financial services);

(xii) 15providing advisory and other auxiliary financial services in
respect of any activity listed in sub-paragraphs (i) to (xi)
(including credit reference and analysis, investment and
portfolio research and advice, advice on acquisitions and on
corporate restructuring and strategy).

(2) 20In subsection (1)(b)(vi), “financial trading” means trading for own account or
for account of customers, whether on an investment exchange, in an over-the-
counter market or otherwise, in financial products.

(3) In this Act “financial products” means—

(a) money market instruments (including cheques, bills and certificates of
25deposit);

(b) foreign exchange;

(c) derivative products (including futures and options);

(d) exchange rate and interest rate instruments (including products such as
swaps and forward rate agreements);

(e) 30transferable securities;

(f) other negotiable instruments and financial assets (including bullion).

55 Interpretation

(1) In this Act—

  • “appropriate Minister” is to be read in accordance with section 1(8);

  • 35“country” includes any territory, region or other place;

  • “designation power” has the meaning given by section 10(1);

  • “economic resources” has the meaning given by section 53(2);

  • “financial products” has the meaning given by section 54(3);

  • “financial services” has the meaning given by section 54(1);

  • 40“freeze”, in relation to funds or economic resources, has the meaning
    given by section 53(3) and (4);

  • “funds” has the meaning given by section 53(1);

  • “international obligation” has the meaning given by section 1(7);

  • “person” has the meaning given by section 9(5);

  • 45“prescribed”, in any provision relating to regulations, means prescribed
    by the regulations;

  • “retained direct EU legislation” has the same meaning as in the European
    Union (Withdrawal) Act 2018 (see section 14(1) of that Act);

  • Sanctions and Anti-Money Laundering BillPage 42

  • “retained EU law” has the same meaning as in that Act (see section 6(7) of
    that Act);

  • “the Security Council” means the Security Council of the United Nations;

  • “the territorial sea” (without more) means the territorial sea adjacent to
    5the United Kingdom;

  • “terrorism” has the same meaning as in the Terrorism Act 2000 (see
    section 1(1) to (4) of that Act);

  • UN obligation” has the meaning given by section 1(7);

  • UN Security Council Resolution” has the meaning given by section 1(7).

(2) 10Any reference in this Act to a person named “for the purposes of” a UN
Security Council Resolution so far as it provides for the taking of particular
measures includes any person who, by virtue of—

(a) being named for any purposes by the Security Council or a subsidiary
organ of the Security Council, and

(b) 15the terms of the resolution,

is a person in relation to whom the resolution provides for the measures to be
taken.

(3) Any reference in this Act to ships designated “for purposes of” a UN Security
Council Resolution which provides for the taking of measures in relation to
20ships includes any ship which, by virtue of—

(a) being designated for any purposes by the Security Council or a
subsidiary organ of the Security Council, and

(b) the terms of the resolution,

is a ship in relation to which the resolution provides for the measures to be
25taken.

(4) Regulations under section 1 may make provision as to the meaning of any
reference in the regulations to funds, economic resources or technology (or a
particular description of funds, economic resources or technology) being—

(a) owned by a person,

(b) 30held by a person,

(c) controlled by a person, or

(d) made available to or for the benefit of a person.

(5) Regulations under section 1 may make provision as to the meaning of any
reference in the regulations to a person “owning” or “controlling” another
35person.

(6) Regulations under section 1 may make provision as to the connection that is
required between—

(a) a person, or a person of a prescribed description, and

(b) a country,

40in order for the person to be regarded as “connected with” that country for the
purposes of any provision of the regulations.

Final provisions

56 Extent

(1) Subject to the following provisions of this section, this Act extends to England
45and Wales, Scotland and Northern Ireland.

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(2) Any amendment or repeal made by Schedule 3 of any provision of —

(a) the Senior Courts Act 1981,

(b) the Crime and Courts Act 2013, or

(c) the Charities Act 2011,

5does not extend to Scotland or Northern Ireland.

(3) Her Majesty may by Order in Council provide for any of the provisions of Part

1

and this Part, or any regulations under Part

1

10 (whether made before or after
the making of the Order in Council), to extend with or without modifications
to—

(a) any of the Channel Islands;

(b) the Isle of Man;

(c) 15any of the British overseas territories.

(4) The power conferred by subsection (3), so far as relating to regulations,
includes power to provide for the regulations as amended from time to time to
extend as mentioned in that subsection.

(5) Her Majesty may by Order in Council provide for the repeal in section 52(1)
20(repeal of provisions of the Terrorist Asset-Freezing etc Act 2010) to extend
to—

(a) any of the Channel Islands;

(b) the Isle of Man;

(c) any of the British overseas territories.

(6) 25The power under section 36 of the Immigration Act 1971 may be exercised so
as to extend to any of the Channel Islands or the Isle of Man any amendment
made by this Act of any part of that Act (with or without modifications).

(7) The power under section 272(6) of the Investigatory Powers Act 2016 may be
exercised so as to extend to the Isle of Man or any of the British overseas
30territories any amendment made by this Act of any part of that Act (with or
without modifications).

57 Commencement

(1) The following provisions come into force on the day on which this Act is
passed—

(a) 35section 45;

(b) sections 46 to 50;

(c) sections 53 to 56;

(d) this section;

(e) section 58.

(2) 40The remaining provisions of this Act come into force on such day as the
Secretary of State may by regulations appoint.

(3) Different days may be appointed for different purposes.

(4) The Secretary of State may by regulations make transitional or saving
provision in connection with the coming into force of any provision of this Act.

(5) 45Any power under this section to make regulations is exercisable by statutory
instrument.

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58 Short title

This Act may be cited as the Sanctions and Anti-Money Laundering Act 2018.

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SCHEDULES

Section 5

SCHEDULE 1 Trade sanctions

Part 1 5Trade sanctions

1 The purposes referred to in section 5(1) are the purposes set out in
paragraphs 2 to 16.

2 Preventing the export of goods of a prescribed description—

(a) to, or for the benefit of—

(i) 10designated persons (see section 9),

(ii) persons connected with a prescribed country, or

(iii) a prescribed description of persons connected with a
prescribed country, or

(b) to, for the benefit of, or for use in, a prescribed country.

3 15Preventing the import of all goods, or of goods of a prescribed description—

(a) which are consigned from a prescribed country,

(b) which originate in a prescribed country,

(c) which are consigned from or imported, manufactured, produced or
owned by—

(i) 20designated persons,

(ii) persons connected with a prescribed country, or

(iii) a prescribed description of persons connected with a
prescribed country,

(d) for the benefit of—

(i) 25designated persons,

(ii) persons connected with a prescribed country, or

(iii) a prescribed description of persons connected with a
prescribed country, or

(e) for the benefit of a prescribed country.

4 30Preventing the movement outside the United Kingdom of goods of a
prescribed description—

(a) to, or for the benefit of—

(i) designated persons,

(ii) persons connected with a prescribed country, or

(iii) 35a prescribed description of persons connected with a
prescribed country,

(b) to, or for the benefit of, a prescribed country,

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(c) from a prescribed country,

(d) which originate in a prescribed country, or

(e) in specified ships (see section 14).

5 Preventing a transfer of technology of a prescribed description—

(a) 5to, or for the benefit of—

(i) designated persons,

(ii) persons connected with a prescribed country, or

(iii) a prescribed description of persons connected with a
prescribed country,

(b) 10to a place (see paragraph 35) in a prescribed country,

(c) to, or for the benefit of, persons outside the United Kingdom, where
the transfer is from a designated person, a person connected with a
prescribed country or a place in a prescribed country,

(d) to a place outside the United Kingdom, where the transfer is from a
15designated person, a person connected with a prescribed country or
a place in a prescribed country,

(e) to persons (other than designated persons) in the United Kingdom,
where the person effecting, or responsible for, the transfer has reason
to believe that the technology may be used in a prescribed country,
20or

(f) to a place in the United Kingdom, where the person effecting, or
responsible for, the transfer has reason to believe that the technology
may be used in a prescribed country.

6 Preventing goods or technology of a prescribed description from being
25made available—

(a) to, or for the benefit of—

(i) designated persons,

(ii) persons connected with a prescribed country, or

(iii) a prescribed description of persons connected with a
30prescribed country,

(b) for the benefit of, or for use in, a prescribed country, or

(c) for use in connection with specified ships.

7 Preventing the acquisition of goods or technology of a prescribed
description—

(a) 35from, or for the benefit of—

(i) designated persons,

(ii) persons connected with a prescribed country,

(iii) a prescribed description of persons connected with a
prescribed country, or

(iv) 40persons on board specified ships, or

(b) in, or which originate in, a prescribed country.

8 Preventing land, or land of a prescribed description, from being made
available to, or for the benefit of—

(a) designated persons,

(b) 45persons connected with a prescribed country, or

(c) a prescribed description of persons connected with a prescribed
country.

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9 Preventing the acquisition of land, or land of a prescribed description—

(a) from, or for the benefit of—

(i) designated persons,

(ii) persons connected with a prescribed country, or

(iii) 5a prescribed description of persons connected with a
prescribed country, or

(b) in a prescribed country.

10 Preventing—

(a) activities of a prescribed description relating (directly or indirectly)
10to military activities from being carried on for the benefit of—

(i) designated persons,

(ii) persons connected with a prescribed country, or

(iii) a prescribed description of persons connected with a
prescribed country, or

(b) 15activities of a prescribed description from being carried on, where
the activities relate (directly or indirectly) to military activities
carried on, or proposed to be carried on, in a prescribed country.

11 Preventing all services, or services of a prescribed description, from being
provided—

(a) 20to, or for the benefit of—

(i) designated persons,

(ii) persons connected with a prescribed country, or

(iii) a prescribed description of persons connected with a
prescribed country, or

(b) 25in the United Kingdom by a prescribed description of persons
connected with a prescribed country.

12 Preventing all services, or services of a prescribed description, from being
procured—

(a) from, or for the benefit of—

(i) 30designated persons,

(ii) persons connected with a prescribed country, or

(iii) a prescribed description of persons connected with a
prescribed country, or

(b) for provision in a prescribed country.

13 35Preventing services, or services of a prescribed description, from being
provided or procured, where the services relate to—

(a) the export of goods of a prescribed description to, or for the benefit
of, persons as mentioned in paragraph 2(a),

(b) the export of goods of a prescribed description to, for the benefit of,
40or for use in, a prescribed country,

(c) the import of goods, or goods of a prescribed description, which are
consigned from, or originate in, a prescribed country,

(d) the import of goods, or goods of a prescribed description, which are
consigned from or imported, manufactured, produced or owned by
45persons as mentioned in paragraph 3(c),

(e) the import of goods, or goods of a prescribed description, for the
benefit of persons as mentioned in paragraph 3(d),

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(f) the import of goods, or goods of a prescribed description, for the
benefit of a prescribed country,

(g) the movement of goods of a prescribed description to, or for the
benefit of, persons as mentioned in paragraph 4(a),

(h) 5the movement of goods of a prescribed description to, or for the
benefit of, a prescribed country,

(i) the movement of goods of a prescribed description from a prescribed
country, or which originate in a prescribed country,

(j) the movement of goods of a prescribed description in specified ships,

(k) 10the transfer of technology of a prescribed description to, or for the
benefit of, persons as mentioned in sub-paragraph (a), (c) or (e) of
paragraph 5,

(l) the transfer of technology of a prescribed description to a place as
mentioned in sub-paragraph (b), (d) or (f) of paragraph 5,

(m) 15the making available of goods or technology of a prescribed
description to, or for the benefit of, persons as mentioned in
paragraph 6(a),

(n) the making available of goods or technology of a prescribed
description for the benefit of, or for use in, a prescribed country,

(o) 20the making available of goods or technology of a prescribed
description for use in connection with specified ships,

(p) the acquisition of goods or technology of a prescribed description
from, or for the benefit of, persons as mentioned in paragraph 7(a),

(q) the acquisition of goods or technology of a prescribed description in,
25or which originate in, a prescribed country,

(r) the making available of land, or land of a prescribed description, to,
or for the benefit of, persons as mentioned in paragraph 8,

(s) the acquisition of land, or land of a prescribed description, from, or
for the benefit of, persons as mentioned in paragraph 9(a),

(t) 30the acquisition of land, or land of a prescribed description, in a
prescribed country,

(u) the carrying on of activities of a prescribed description as mentioned
in sub-paragraph (a) of paragraph 10 for the benefit of persons as
mentioned in that sub-paragraph,

(v) 35the carrying on of activities of a prescribed description as mentioned
in paragraph 10(b), or

(w) the provision or procurement of other services, or services of a
prescribed description, which relate to a matter mentioned in any of
sub-paragraphs (a) to (v).

14 40Preventing services, or services of a prescribed description, from being
provided or procured, where the services relate to—

(a) the provision of other services, or services of a prescribed
description, to, or for the benefit of, persons as mentioned in
paragraph 11(a),

(b) 45the provision of other services, or services of a prescribed
description, in the United Kingdom by a prescribed description of
persons connected with a prescribed country,

(c) the procurement of other services, or services of a prescribed
description, from, or for the benefit of, persons as mentioned in
50paragraph 12(a),

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(d) the procurement of other services, or services of a prescribed
description, for provision in a prescribed country,

(e) projects, industries, sectors or infrastructure of a prescribed
description in a prescribed country,

(f) 5activities of a prescribed description carried on, or proposed to be
carried on, in a prescribed country,

(g) trade with a prescribed country,

(h) aircraft registered in a prescribed country,

(i) ships registered in a prescribed country,

(j) 10specified ships, or

(k) the provision or procurement of other services, or services of a
prescribed description, which relate to a matter mentioned in any of
sub-paragraphs (e) to (j).

15 So far as a UN Security Council Resolution provides for the taking of
15measures in relation to ships designated for purposes of that resolution, and
so far as the purposes set out in this paragraph are relevant to that
resolution, preventing—

(a) the movement outside the United Kingdom of goods of a prescribed
description in such ships,

(b) 20goods or technology of a prescribed description from being made
available for use in connection with such ships,

(c) the acquisition of goods or technology of a prescribed description
from persons on board such ships, or

(d) the provision or procurement of services which relate to such ships.

16 25Preventing—

(a) the export, import, movement, making available or acquisition of
objects of cultural interest, or objects of cultural interest of a
prescribed description, which have been removed from a prescribed
country, or

(b) 30services of a prescribed description from being provided or
procured, where the services relate to objects of cultural interest, or
objects of cultural interest of a prescribed description, which have
been removed from a prescribed country.

Part 2 35Further provision

Further provision

17 Regulations which include provision for a purpose mentioned in Part 1 may
describe goods wholly or partly by reference to—

(a) the uses to which the goods, or any information recorded on or
40derived from them, may be put,

(b) the types of users of the goods, or of any such information,

(c) the industries, sectors, infrastructure or projects to which the goods,
or any such information, may relate, or

(d) the place where the goods originate.

18 45Regulations which include provision for a purpose mentioned in paragraph
2 or 3 may describe goods wholly or partly by reference to their being of an