About international sanctions
Sanctions are used as an enforcement tool to maintain and restore international peace and security: these sanctions are made by the United Nations Security Council (UNSC) and must be implemented by all UN members.
Sanctions are also used as a foreign policy tool by individual states, or groups of countries working together, when all other diplomatic methods have failed. These sanctions are sometimes referred to as autonomous sanctions and are made outside the UNSC framework.
In addition to UNSC sanctions, the UK also implements its own autonomous sanctions. Jersey implements both UNSC sanctions and autonomous UK sanctions.
Sanctions are used:
- to prevent and suppress the financing of terrorism and terrorist acts: for example, terrorist asset-freeze designations in place against certain individuals, groups or organisations engaged in, or supporting, terrorism
- to encourage a change in the behaviour of a target country or regime: for example, the sanctions against Russia for its bombing and invasion of Ukraine, in addition to previous actions since 2014 that include the annexation of Crimea and other attempts to destabilise the country
- to apply pressure on a target country or regime to comply with set objectives: for example, the sanctions against the Democratic People's Republic of Korea (North Korea) were put in place to encourage the regime to give up its nuclear weapons programme and to increase the cost on the regime of pursuing this policy
Sanctions are only used in the most serious of circumstances. In international relation terms the only action considered more serious than sanctions is military action. Countries usually try to achieve their aims diplomatically, but if that is not possible they may introduce sanctions.
A wide range of measures can be enforced under sanctions regimes, from asset-freeze designations (see below for more information on asset-freezes) to restrictions on the import or export of specified goods, and prohibitions on the provision of financial and other services.
How sanctions are implemented
Though Jersey is not a UN member in its own right, the UK's membership of the UN extends to the island. Therefore, in common with all UN members, Jersey has an obligation to implement UNSC sanctions Resolutions.
Both UNSC sanctions and autonomous UK sanctions are implemented by the UK under the relevant sanctions Regulations made under the Sanctions and Money Laundering Act 2018 ("SAMLA").
Jersey implements both UNSC sanctions and autonomous UK sanctions by implementing the relevant SAMLA Regulations through the Sanctions and Asset-Freezing (Jersey) Law 2019 ("SAFL"), and the Sanctions and Asset-Freezing (Implementation of External Sanctions) (Jersey) Order 2021 (the "External Sanctions Order").
Sanctions and Asset-Freezing (Jersey) Law 2019
SAFL is Jersey's key piece of sanctions legislation, and together with the External Sanctions Order, ensures that the Island can implement UNSC and autonomous UK sanctions without delay, in line with international standards.
Sanctions and Asset-Freezing (Implementation of External Sanctions) (Jersey) 2021
The External Sanctions Order was made under SAFL and gives effect to both UNSC sanctions Resolutions and autonomous UK sanctions regimes, by implementing the relevant SAMLA Regulations.
Financial Sanctions Notices
New UNSC and autonomous UK asset-freeze designations are effective immediately in Jersey.
When there has been a change to the asset-freeze designations in force in Jersey, a Financial Sanctions Notice ("Notice") is issued by External Relations and published on the Jersey Gazette. You can register to receive email alerts when a new Notice is published.
Notices are published when:
- individuals or entities have been designated for the purpose of an asset-freeze
- individuals or entities are no longer subject to an asset-freeze
- the details of existing asset-freeze designations (for example, identifying information) have been changed
- there are other significant changes to Jersey's sanctions regime
The Notice may include identifying information on asset-freeze designations and what you must do, as well as legislative details and other relevant information.
An asset-freeze designation is a type of targeted financial sanction that requires anyone holding a listed person's ('person' can refer to both individuals and legal entities) funds or economic resources to freeze them.
What they do
Where a person is subject to an asset freeze designation, it is generally prohibited to:
- deal with the frozen funds or economic resources, belonging to or owned, held or controlled by a designated person
- make funds or economic resources available, directly or indirectly, to, or for the benefit of, a designated person
- make financial services available, directly or indirectly, to a designated person
- engage in actions that, directly or indirectly, circumvent the financial sanctions prohibitions
The funds and economic resources must be frozen immediately by the person in possession or control of them without notice and without delay. An asset freeze does not involve a change in ownership of the frozen funds or economic resources, nor are they confiscated or transferred to the Minister or the FSIU for safekeeping.
The definition of "owned", "held", "controlled", "directly" and "indirectly" can be found in Article 2A of SAFL. See also Schedule 2 (Rules for Interpretation of Article 2A(6)).
What you must do
If you know or have 'reasonable cause to suspect' that you are in possession or control of, or are otherwise dealing with, the funds or economic resources of a designated person you must:
- freeze such accounts, and other funds or economic resources without prior notice and without delay
- refrain from dealing with the funds or assets or making them available (directly or indirectly) to such persons unless licensed by the Minister for External Relations ("MER")
- report any findings to MER, together with any additional information that would facilitate compliance with SAFL
- provide any information concerning the frozen assets of designated persons that MER may request. Information reported to MER may be passed on to other regulatory authorities or law enforcement
Reasonable cause to suspect refers to an objective test that asks whether there were factual circumstances from which an honest and reasonable person should have inferred knowledge or formed the suspicion.
Asset freezing terminology
Funds generally means financial assets and benefits of every kind, including but not limited to:
- cash, cheques, claims on money, drafts, money orders and other payment instruments
- deposits with financial institutions or other entities, balances on accounts, debts and debt obligations
- publicly- and privately-traded securities and debt instruments, including stocks and shares, certificates representing securities, bonds, notes, warrants, debentures and derivatives contracts
- interest, dividends or other income on or value accruing from or generated by assets
- credit, right of set-off, guarantees, performance bonds or other financial commitments
- letters of credit, bills of lading, bills of sale
- documents showing evidence of an interest in funds or financial resources
- any other instrument of export financing
Economic resources generally means assets of every kind – tangible or intangible, movable or immovable – which are not funds, but may be used to obtain funds, goods or services.
Unfreezing Assets for Delisted Persons / Entities
The obligation to freeze funds or assets no longer exist in circumstances where:
- Following a UN delisting of a person/entity, the UK gives effect to the de-listing under the relevant Regulations made under the Sanctions and Anti-Money Laundering Act 2018 ("SAMLA")*
- The UK has de-listed a person subject an autonomous UK asset-freeze designation implemented under Regulations made under SAMLA
- the Minister considers that the required conditions are not met in respect of a relevant designation (i.e. an interim or final terrorism designation made under SAFL), and has taken the decision to revoke the designation
In this regard, where a FSIU Financial Sanctions Notice has been published on the Jersey Gazette, which confirms that a person/entity has been removed from the Consolidated List or a designation has been revoked by the Minister, then the following measures must be undertaken by the relevant institution:
- determine whether any of the assets held on account are the assets of a person/entity who has been removed from the OFSI Consolidated List and ensure that they are no longer subject to an asset freeze
- remove the name of the person/entity from the institution's list of persons/entities subject to financial sanction
- unfreeze the assets of the person/entity (as applicable) and re-activate all relevant accounts
- notify the person/entity that the assets are no longer subject to an asset freeze
- immediately notify the Minister of the actions which have been undertaken upon completion through firstname.lastname@example.org
*All new asset-freeze designations made by the UN have immediate and automatic effect in Jersey. However, when a person/entity is de-listed by the UN, the de-listing does not have legal effect in Jersey until the UK has given effect to it under the relevant SAMLA Regulations.
False Positives and Unfreezing Assets
It may sometimes happen that the assets of a person or entity with the same or similar name as a designated person or entity, but who is not a designated person or entity, is inadvertently affected by a freezing mechanism (i.e., a false positive).
The responsibility to freeze an asset subject to targeted financial sanctions rests with the person or entity that holds the asset, for example the financial institution that holds the funds of a designated person or entity.
If your assets have been wrongly frozen
If you consider that an asset that you directly or indirectly own or control has been frozen in error, you should contact the asset holder in the first instance. If, following contact with the asset holder, you continue to consider that the asset has been frozen in error, you should email FSIU at email@example.com to provide the following information:
- your full name and contact details
- the details of the asset and asset holder, including details of your legal or other interest in the asset
- details of your contact with the asset holder
- the reasons for your belief that the asset has been frozen in error.
If you have frozen assets and believe they have been wrongly frozen
If, for example, you are financial institution that has frozen the assets of a person or entity with the same or similar name as a designated person or entity, but who you believe may not be a designated person or entity, or you are having trouble verifying that the person or entity is designated, you can email the FSIU at firstname.lastname@example.org and provide the following information:
- your full name and contact details
- the name and address of your company
- the details of the asset and asset owner/controller, including details of their legal or other interest in the asset
- details of any contact you have had with the asset owner/controller
- what action you have undertaken to verify that the asset owner/controller is a designated person
- the reasons for your belief that the asset may have been frozen in error or that asset owner/controller is not a designated person.
What the FSIU will do
The FSIU will examine the evidence provided and the relevant circumstances surrounding the issue to determine the way forward. The possible scenarios and respective outcomes are as follows:
- Where the FSIU has determined that the person/entity concerned is not the designated person/entity from the sanctions list, they will inform the relevant institution and person/entity of their findings. The relevant institution should take the steps necessary to unfreeze the funds or economic resources of the person/entity and thereafter inform the FSIU of the action undertaken
- Where the FSIU has determined that the person/entity concerned is the designated person/entity from the sanctions list, they will inform the relevant institution and person/entity of their findings and the asset freeze will remain in effect
Jersey terrorism asset-freeze designations
Under Part 4 of SAFL the Minister can designate a person for the purpose of an asset-freeze if the Minister suspects or believes that that person is involved with or connected with terrorist activity. There are currently no such Jersey terrorist asset-freeze designations
A person who has been designated for the purpose of an asset freeze
under SAFL by the Minister may request their designation be reviewed. Guidance on how to request a review and the requisite review request form can be found below:
Guidance how to request review if designated under SAFL
Sanctions review request form - designated person
Offences and prohibitions
Column 5 of Schedule 1 to the External Sanctions Order sets out the regime-specific ( for example, Syria) non asset-freeze prohibitions in the UK regulations to which an offence will apply in Jersey. Other offences are set out in SAFL and the External Sanctions Order.
See JFSC guidance by country and category and OFSI guidance for detailed information on individual regimes.
The maximum custodial sentence for a breach of financial sanctions is a term of 7 years imprisonment.
Reporting obligations are set out in Article 32 of SAFL and apply to all sanctions regimes in force. These obligations include requirements for a relevant financial institution* (the "institution") to inform the Minister if:
- it holds an account of a person, has entered into dealings or an agreement with a person or has been approached by or on behalf of a person
- it knows, or has reasonable cause to suspect, that the person:
i) is a designated person, or
ii) has committed, is committing or intends to commit an offence, and
The information given to the Minister must include:
- the information or other matter on which the relevant financial institution's knowledge or reasonable cause for suspicion is based
- any information that the relevant financial institution holds about the person by which the person can be identified
- if the person is a customer or client of the institution, the nature and amount or quantity of any funds or economic resources held by the institution for the person at the time when the institution first had the knowledge or reasonable cause for suspicion
You should use the Sanctions Compliance Reporting Form to comply with any reporting obligations in respect of financial sanctions and return the completed form to email@example.com
These reporting obligations are in addition to the obligation to report suspicious activities to the Financial Intelligence Unit.
If you are unsure of your reporting obligations, you should seek independent legal advice.
Relevant Financial Institution*
The definition of a relevant financial institution can be found in Article 1 of SAFL. This definition includes:
Sanctions licences and exceptions
You should use thesanctions licence application form to apply for a sanctions licence and return the completed form to firstname.lastname@example.org. A licence will only normally be granted by the Minister if there is scope in the relevant UK Sanctions Regulations (e.g. Russia (Sanctions) (EU Exit) Regulations 2019) implemented in Jersey under the External Sanctions Order.
- A licence will only normally be granted by the Minister if there is scope in the relevant UK Sanctions Regulations for an equivalent licence to be granted by the UK Treasury
- Exceptions to prohibitions apply automatically in certain defined circumstances as set out in Article 15 of SAFL, and in UK Sanctions Regulations implemented in Jersey under the External Sanctions Order, and do not require you to obtain a licence from the Minister.
- UK General Licences (non-Russia or Belarus) do not apply to Jersey persons or institutions operating in Jersey; however, they may be considered as the basis for a licence application
- UK General Licences (Russia and Belarus Regimes): all UK General Licences issued in respect of the Russia and Belarus regime have automatic effect in Jersey and may be relied upon by Jersey persons. All reporting requirements also apply to the UK General Licences and reports should be submitted to the Minister in line with the terms of the licence.
- You should be particularly cautious when seeking to rely on exceptions in implemented UK Sanctions Regulations and/or Russia or Belarus UK General Licences; many of the provisions used are drafted for a specific UK-context (e.g. referring to UK legislation). We recommend that you consider taking legal advice before seeking to rely on them.
Find out more about licences and exceptions.
Sanctions evasion is the deliberate attempt to avoid or circumvent the impact of the sanctions prohibitions in place against a targeted country, group, or individual.
The techniques used to evade sanctions will vary depending on the type of sanction imposed. It could involve pre-emptively transferring assets to avoid an asset-freeze, facilitating the import of prohibited items, or disguising military goods to circumvent an export ban. In every case, the goal is to engage in the prohibited activity while remaining undetected. In July 2022, the UK's National Economic Crime Centre (NECC) issued an alert to industry about the financial sanctions evasion typologies used by Russian elites and their 'enablers' (close associates and professional services firms) to evade sanctions. While some of the information in the report is UK-specific, the vast majority will be relevant to individuals and businesses operating in or from within Jersey.
The document shows that Designated Persons (DPs) are using a range of methods to evade targeted financial sanctions, including transferring assets to trusted proxies and moving funds to jurisdictions where sanctions are not in place. In order to move funds, DPs are circumventing usual payment methods such as SWIFT and are moving towards alternatives, and there has been an increasing use of crypto-asset services (e.g. Blockchain).
While some enablers may be criminally complicit with, or wilfully blind to, sanctions evasion, others may be unintentionally involved due to weak controls and a lack of due diligence on high-risk clients.
The document provides useful guidance and recommendations for businesses on how to detect suspicious payments, prevent the transfer of frozen assets, and avoid becoming an unwitting facilitator of sanctions evasion.
Read the full report on the NCA website.
In November 2023, the NECC also issued a Red Alert
on Gold-based Financial and Trade Sanctions circumvention.
The Red Alert also tackles sanctions circumvention by calling on businesses to report suspicious activity, including any attempts to breach sanctions and providing guidance on how to do so.
NECC Red Alert on Gold-based Financial and Trade Sanctions circumvention
The JFSC have published a webpage relating to
sanction evasion techniques, expanding on their previously published guidance on
Proliferation Financing sanctions evasion techniques.
Sanctions obligations and sanctions evasion techniques — Jersey Financial Services Commission (jerseyfsc.org)
Oil Price Cap
The Oil Price Cap on Russian crude oil came into immediate effect in both Jersey and the UK on 05 December 2022, and the Oil Price Cap on Russian refined oil products will come into effect from the 05 February 2023.
General Licences to facilitate the Oil Price Cap can be found on the OFSI website here. These General Licences are also in effect in Jersey.
The UK Government has published detailed guidance on the Oil Price Cap, which can be found here. A number of new forms have been created by the UK Government in relation to the Oil Price Cap, namely:
- Breach Reporting Form
- Extraordinary Situation Licence Application Form
- Emergency Use of Exemption Notification Form
Jersey versions of these forms are being developed and will be available for use in due course.
Responsibility for sanctions in Jersey
Minister for External Relations and Financial Services
The Minister for External Relations and Financial Services is the 'Competent Authority' for Jersey.
Financial Sanctions Implementation Unit
The Financial Sanctions Implementation Unit (FSIU) coordinates the introduction of sanctions measures and assists the Minister in carrying out his duties as Competent Authority: this includes receiving sanctions compliance reports, processing sanctions licence applications, and publishing financial sanctions notices and guidance.
Responsibility for monitoring and ensuring compliance with sanctions rests with individual businesses, for example, banks, through their compliance officers.
Jersey Financial Services Commission
The Jersey Financial Services Commission (JFSC) has an overall regulatory role with regard to the finance industry generally, which includes checking that institutions have effective systems and procedures to implement compliance with sanctions.
Joint Financial Crimes Unit
The Joint Financial Crimes Unit is responsible for receiving Suspicious Activity Reports, gathering intelligence on financial crime, including sanctions, and investigating possible breaches of sanctions legislation.
Law Officers' Department
The Law Officers' Department consists of both the Civil and Criminal Divisions. The Civil Division provides legal advice to the Government and the Criminal Division is responsible for prosecutions.
Economic Crime and Confiscation Unit
The Economic Crime and Confiscation Unit lead criminal investigations into potential breaches of sanctions legislation.
Customs and Immigration Service
The States of Jersey Customs and Immigration Service is responsible for the enforcement of any sanctions that concern the movement of goods or persons.
Combatting the financing of terrorism
Find out more about the legislative measures Jersey has in place to combat the financing of terrorism.
Combatting proliferation financing
Find out more about the legislative measures Jersey has in place to combat proliferation financing.
Additional information about non-financial sanctions
Customs and Immigration: enforcement of travel bans in Jersey
Travel bans imposed on specified individuals or nationals of a particular country are applied locally in accordance with the relevant sanctions in a similar way as they are in the United Kingdom. For further information contact the Jersey Customs and Immigration Service.
Export controls and sanctions
Jersey implements the same trade restrictions as the UK. The UK provides guidance on trade sanctions, arms embargoes and other trade restrictions.
Further guidance on sanctions
Further information is available on the JFSC website:
Challenging sanctions designations
Those who are subject to financial sanctions can request a reassessment of their listing. The financial sanctions will remain in place while the reassessment is taking place.
If you are a designated person who is named in a UN list, you, or a person acting on your behalf, can request that the Government of Jersey (GoJ) use its best endeavours to secure the removal of your name from the relevant UN list. You may wish to request such an action if you believe that the reasons for your designation are incorrect.
The GoJ cannot contact the UN directly in this regard. However, the Ministry of External Relations ("External Relations") and the UK Foreign, Commonwealth and Development Office (FCDO) have in place an arrangement in respect of requests for the de-listing of UN listed persons. Under this arrangement, External Relations can request that the FCDO make a de-listing request on its behalf. Such a request for assistance to the FCDO will only be made if, in the view of the Minister for External Relations and Financial Services, there are sufficient grounds for doing so.
If you are a UK designated person (other than a person designated under a UN list), you, or a person acting on your behalf, have the right to request a revocation or variation of your designation. You may wish to request a revocation, for instance, if you believe that the reasons for your designation are incorrect, or a variation if, for instance, particular information associated with your designation, such as your date of birth, is incorrect. Other reasons for seeking a revocation could include if you believe your designation is inappropriate having regard to the purpose of the regime, or the likely significant effects of the designation.
For further information, including eligibility to apply for a variation or revocation of a UK designation, submitting a sanctions challenge form and other information, consult the Foreign, Commonwealth and Development Office at email@example.com.
There are currently no autonomous Jersey listings in force.
Submitting a request
In the first instance, UN listed persons should make a de-listing request directly to the UN.
In respect of UN listings made under the ISIL (Da'esh) and Al Qaida sanctions regime, persons can contact the Office of the Ombudsperson. A full description of the procedure for making such requests can be found on the UN website. In respect of UN listings made under any other UNSC sanctions regime, persons can contact the UN Focal Point for De-Listing.
UN listed persons can also make a request to the UK for revocation, variation or review of your designation, as can any persons designated or listed under a UK sanctions regime. You should complete a UK review request form.
By properly and fully completing the form, you will ensure that you meet the requirements for a valid request. This form can also be completed by another person on the behalf of the designated or listed person, if confirmation of authority is provided. It is recommended that Jersey persons wishing to make a de-listing request in respect of a UK designation do so directly through the UK.
You can also submit a request for a UN or UK de-listing to the Minister for External Relations at firstname.lastname@example.org, providing equivalent information to that required in a UK review request form.
SAFL: Article 37A Procedures
Under Article 37A of SAFL, the Minister is required to publish procedures for the performance of the Ministers functions under Articles 43A, 45A, and 45B: