Sanctions and Anti-Money Laundering Bill (HL Bill 69)

Sanctions and Anti-Money Laundering BillPage 30

(4) Any power under this Act to make regulations is exercisable by statutory
instrument.

(5) In this section “enactment” includes—

(a) an enactment contained in any Order in Council, order, rules,
5regulations or other instrument made under an Act,

(b) an enactment contained in, or in an instrument made under, an Act of
the Scottish Parliament,

(c) an enactment contained in, or in an instrument made under, a Measure
or Act of the National Assembly for Wales,

(d) 10an enactment contained in, or in an instrument made under, Northern
Ireland legislation, and

(e) any retained direct EU legislation.

(6) In subsection (2)(b) the reference to persons “designated” by or under a
repealed or revoked enactment includes, where the enactment is retained
15direct EU legislation, persons listed in or under that enactment.

(7) This section does not apply to regulations under—

(a) section 46 (regulations under section 1: transitory provision), or

(b) section 52 (commencement).

45 Parliamentary procedure for regulations

(1) 20Subsection (3) applies to a statutory instrument which—

(a) contains non-UN regulations under section 1 (see subsection (7)),

(b) does not contain any UN regulations under that section, and

(c) is not a statutory instrument mentioned in subsection (5)(a) to (d).

(2) Subsection (3) also applies to a statutory instrument which contains only
25regulations under section 41 which make new provision about high-risk
countries (see subsection (9)).

(3) A statutory instrument to which this subsection applies—

(a) must be laid before Parliament after being made, and

(b) if not approved by a resolution of each House of Parliament before the
30end of 28 days beginning with the day on which it is made, ceases to
have effect at the end of that period (but without that affecting anything
done under the regulations or the power to make new regulations).

(4) In calculating a period of 28 days for the purposes of subsection (3), no account
is to be taken of any time during which Parliament is dissolved or prorogued
35or during which both Houses are adjourned for more than 4 days.

(5) A statutory instrument containing (whether alone or with other provision)—

(a) regulations under section 1 that repeal, revoke or amend any provision
of primary legislation,

(b) regulations under section 39,

(c) 40regulations under section 40, or

(d) regulations under section 41,

may not be made unless a draft of the instrument has been laid before, and
approved by a resolution of, each House of Parliament.

This subsection does not apply to a statutory instrument to which subsection
45(3) applies by virtue of subsection (2).

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(6) A statutory instrument containing regulations under this Act which is not—

(a) a statutory instrument to which subsection (3) applies,

(b) a statutory instrument mentioned in subsection (5)(a) to (d),

(c) a statutory instrument containing only regulations under section 46, or

(d) 5a statutory instrument containing only regulations under section 52,

is subject to annulment in pursuance of a resolution of either House of
Parliament.

(7) In subsection (1)UN regulations” means regulations under section 1 that—

(a) are regulations the stated purpose of which, or one of the stated
10purposes of which, is compliance with a UN obligation, or

(b) amend regulations under section 1 the stated purpose of which, or one
of the stated purposes of which, is compliance with a UN obligation,

and “non-UN regulations” means any regulations under section 1 which are
not UN regulations.

(8) 15For the purposes of subsection (7), a purpose is a “stated purpose” of
regulations under section 1 if it is stated under section 1(3) in the regulations.

(9) For the purposes of subsection (2), regulations under section 41 “make new
provision about high-risk countries” if they add or remove an entry in a list of
countries in relation to which enhanced customer due diligence measures are
20required to be taken by virtue of—

(a) the Money Laundering Regulations 2017 (S.I. 2017/692), or

(b) regulations under section 41.

(10) In this section “primary legislation” means—

(a) an Act of Parliament,

(b) 25an Act of the Scottish Parliament,

(c) a Measure or Act of the National Assembly for Wales, or

(d) Northern Ireland legislation.

46 Regulations under section 1: transitory provision

(1) If the appropriate Minister making a statutory instrument containing (whether
30alone or with other provision) any regulations under section 1 considers it is
appropriate to do so in consequence of, or otherwise in connection with, the
withdrawal of the United Kingdom from the EU, the instrument may provide
that it comes into force, or that any provision of regulations contained in the
instrument comes into force, on such day as that Minister may by regulations
35under this section appoint.

(2) Any power of an appropriate Minister to appoint a day under this section
includes—

(a) a power to appoint different days for different purposes, and

(b) a power to appoint a time on a day if that Minister considers it
40appropriate to do so (including a time that has effect by reference to the
coming into force of any other enactment).

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

(4) Subsection (5) applies in the case of a statutory instrument—

(a) 45which contains provision by virtue of subsection (1) of this section, and

Sanctions and Anti-Money Laundering BillPage 32

(b) to which section 45(3) applies by virtue of subsection (1) of that section.

(5) Where this subsection applies—

(a) the reference in section 45(3)(b) to the day on which the statutory
instrument is made is to be read as a reference to the first day on which
5any provision of the regulations contained in the instrument comes into
force for any purpose in accordance with regulations under this section,
and

(b) any reference in section 45(3) or (4) to 28 days is to be read as a reference
to 60 days.

(6) 10In this section “enactment” includes an enactment mentioned in any of
paragraphs (a) to (d) of section 44(5).

47 Consequential amendments and repeals

(1) Part 1 of the Terrorist Asset-Freezing etc Act 2010 is repealed, except for—

(a) paragraphs 1 to 5 of Schedule 1 to that Act (amendments of rules of
15court), and

(b) section 45(1) of that Act so far as it introduces that Schedule.

(2) Neither paragraphs 1 to 5 of Schedule 1 to that Act, nor the exception of those
paragraphs from the repeal made by subsection (1), affects any power to
amend or revoke any provision of—

(a) 20the Rules of the Court of Judicature (Northern Ireland) 1980 (S.R. 1980/
346), or

(b) the Civil Procedure Rules 1998 (S.I. 1998/3132)).

(3) Subsection (1) does not affect the power in section 54 of the Terrorist Asset-
Freezing etc Act 2010 to make provision by Order in Council extending to any
25of the Channel Islands, the Isle of Man or any British overseas territory.

(4) Part 1 of Schedule 3 contains amendments consequential on Parts 1 and 2 of
this Act.

(5) Part 2 of Schedule 3 contains repeals and other provision consequential on
subsection (1).

30Definitions

48 Meaning of “funds”, “economic resources” and “freeze”

(1) In this Act “funds” means financial assets and benefits of every kind, including
(but not limited to)—

(a) cash, cheques, claims on money, drafts, money orders and other
35payment instruments;

(b) deposits, balances on accounts, debts and debt obligations;

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

(d) 40interest, dividends and other income on or value accruing from or
generated by assets;

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

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

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

(h) any other instrument of export financing.

(2) 5In 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) In 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) 10they 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
volume, amount, location, ownership, possession, character or
destination, or

(c) 15any other change is made that would enable their use, including
portfolio management.

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

(a) 20they 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).

49 Meaning of “financial services” and “financial products”

(1) In this Act “financial services” means any service of a financial nature,
25including (but not limited to)—

(a) insurance-related services consisting of—

(i) direct life assurance;

(ii) direct insurance other than life assurance;

(iii) reinsurance and retrocession;

(iv) 30insurance intermediation, such as brokerage and agency;

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

(b) banking and other financial services consisting of—

(i) accepting deposits and other repayable funds;

(ii) 35lending (including consumer credit, mortgage credit, factoring
and financing of commercial transactions);

(iii) financial leasing;

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

(v) 40providing guarantees or commitments;

(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) 45money brokering;

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(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
5securities, 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) 10providing 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) 15In 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
20deposit);

(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) 25transferable securities;

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

50 Interpretation

(1) In this Act—

  • “appropriate Minister” is to be read in accordance with section 1(7);

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

  • “designation power” has the meaning given by section 9(1);

  • “economic resources” has the meaning given by section 48(2);

  • “financial products” has the meaning given by section 49(3);

  • “financial services” has the meaning given by section 49(1);

  • 35“freeze”, in relation to funds or economic resources, has the meaning
    given by section 48(3) and (4);

  • “funds” has the meaning given by section 48(1);

  • “international obligation” has the meaning given by section 1(6);

  • “person” has the meaning given by section 8(5);

  • 40“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 2017 (see section 14(1) of that Act);

  • “retained EU law” has the same meaning as in that Act (see section 6(7) of
    45that Act);

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

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

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  • “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(6);

  • UN Security Council Resolution” has the meaning given by section 1(6).

(2) 5Regulations 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) held by a person,

(c) 10controlled by a person, or

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

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

(4) 15Regulations 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,

in order for the person to be regarded as “connected with” that country for the
20purposes of any provision of the regulations.

Final provisions

51 Extent

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

(2) 25Any 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,

does not extend to Scotland or Northern Ireland.

(3) 30Her Majesty may by Order in Council provide for any of the provisions of Part
1 and this Part, or any regulations under Part 1 (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) 35the Isle of Man;

(c) any 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) 40Her Majesty may by Order in Council provide for the repeal in section 47(1)
(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;

Sanctions and Anti-Money Laundering BillPage 36

(c) any of the British overseas territories.

(6) The 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) 5The 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
territories any amendment made by this Act of any part of that Act (with or
without modifications).

52 Commencement

(1) 10The following provisions come into force on the day on which this Act is
passed—

(a) sections 42 to 46;

(b) sections 48 to 51;

(c) this section;

(d) 15section 53.

(2) The 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
20provision in connection with the coming into force of any provision of this Act.

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

53 Short title

This Act may be cited as the Sanctions and Anti-Money Laundering Act 2017.

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SCHEDULES

Section 4

SCHEDULE 1 Trade sanctions

Part 1 5Trade sanctions

1 The purposes referred to in section 4(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 8),

(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 13).

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),