Legislative Scrutiny: The Sanctions and Anti-Money Laundering Bill Contents

Conclusions and recommendations

Threshold for making sanctions regulations

1.We welcome Clause 2 of the Bill which requires Ministers to explain why they think it appropriate to introduce regulations for a discretionary purpose. (Paragraph 17)

Magnitsky clause

2.We note that during Second Reading debate in the Commons, consideration was given to the inclusion of a “Magnitsky clause” which would enable sanctions regulations to be made for the purpose of preventing or responding to “gross human rights abuse or violations.” We support the intention behind a “Magnitsky” amendment. We welcome the provisions in the Bill that allow for the imposition of sanctions to deal with all forms of human rights abuses. We consider it should be a strong presumption that the names of those sanctioned by refusal of entry to the UK, together with the reasons for this, should be made public. We urge Ministers to give reassurance on this point. Similarly, we consider that and that use of the exclusions in clause 11 (9) and 12(9) should be the exception and not the norm. (Paragraph 18)

Power to add new type of sanctions

3.We particularly note the views of the Delegated Powers and Regulatory Reform Committee on the parliamentary procedure for scrutiny of sanctions regulations. (Paragraph 21)

4.We recognise that delegated powers are necessary to allow for sanctions regimes to be created and amended in individual cases. However, such powers must be sufficiently circumscribed. We therefore welcome the amendment to clause 41 stipulating that the power to specify new types of sanction by regulation will only be exercisable if it replicates sanctions or kinds of sanctions used at the international level. (Paragraph 23)

Threshold for designation decisions

5.We do not consider that the Government has been sufficiently clear in setting out its reasons for reducing the threshold for making designation decisions from “reasonable grounds to believe” to “reasonable grounds to suspect”. We would be grateful if the Government could set out in more detail why it is necessary to use the lower international standard as opposed to the higher standard that is currently applied to domestic terrorist-related sanctions. Colleagues may wish to probe this matter further in the course of their legislative scrutiny. (Paragraph 32)

Due process for designated persons

6.We recommend that clause 21 is amended to require annual reviews of designation decisions. (See Appendix 1). (Paragraph 38)

7.We recognise that the UK is bound by international law to implement UN listings. However, where there is scope within the domestic system to strengthen due process rights, this should be done. Regular periodic review of designations is essential for ensuring that decisions remain justified, necessary, and proportionate and do not interfere with rights for longer than required. (Paragraph 47)

8.In our view, it is undesirable to leave any room for uncertainty as to the courts’ jurisdiction. In cases involving severe interferences with the fundamental rights of individuals, they should have a full right of appeal. We therefore recommend that clause 33(4) is amended to provide for a full right of appeal for designated persons. (See Appendix 1). (Paragraph 54)

9.We are mindful of the risk that a culture of prohibitive damages could prevent the ability of the Government to use sanctions as a useful tool to seek to combat horrific human rights abuses in third countries. However, we also underline the importance of compliance with the right to an effective remedy, as protected by Article 13 of the Convention. It would not be helpful for Parliament to pass a Sanctions Bill that was then subject to successful (and costly) judicial challenge before the UK Courts or the Strasbourg Court for failure to adequately provide for effective remedy under Article 13 of the Convention. Colleagues may wish to test the Government’s thinking on this matter further in the course of their legislative scrutiny. We therefore propose a probing amendment to clause 34(2) dealing with the right to an effective remedy. This may establish why the Government does not appear concerned that, as drafted, the Bill would seem to be vulnerable to challenge as non-compliant with Article 13 of the Convention. (Paragraph 60)

10.In order to ensure compliance with Article 6, the standard of disclosure should be sufficient to ensure persons challenging their designation are given sufficient information to enable them to refute, as far as possible, the case against them. We expect that Ministers, when giving a “statement of reasons” as required by clauses 11(8) and 12(8), will adhere to this standard. (Paragraph 62)

Removal of independent oversight

11.In addition to the limitations placed on the courts, the Bill has removed existing independent oversight arrangements in relation to terrorist-related sanctions. We see no reason for the removal of this oversight function and invite the Government to provide this. Pending any such explanation we recommend that the powers of review currently vested in the Independent Reviewer are retained and set out clearly on the face of the Bill. (See amendment in Appendix 1). (Paragraph 65)


12.We recommend that the publication of the guidance regarding licensing and exemptions is expedited. (Paragraph 68)

1 March 2018