Report
Terrorism (Amendment No. 2) ( Jersey ) Law, 200-
Introduction
1. In 2008 the Island’s framework to counter money laundering and terrorist financing is to be the subject of a review by the International Monetary Fund. Jersey will be assessed against the international standards set by the Financial Action Task Force on Money Laundering (“FATF”). The amendments implemented by this draft Law have been formulated to implement a number of the criteria set out in the 40 Recommendations and 9 Special Recommendations of the FATF, against which Jersey will be assessed and also to address inconsistencies in the current operation of the Proceeds of Crime (Jersey) Law, 1999, (“POCL”) the Drug Trafficking Offences (Jersey) Law, 1988 (“DTOL”) and the Terrorism (Jersey) Law, 2002 (“TL”).
Article 23 Amendment
2. In line with the new provisions being proposed for introduction into the POCL and DTOL, Article 2 of the draft Law amends Article 23 of the TL so that a person working for a financial institution does not commit the offence of failing to disclose a knowledge or suspicion, or reasonable grounds for a knowledge or suspicion, of the commission of a terrorist offence under Articles 15-18 of the TL, if he or she does not in fact know or suspect that such a terrorist offence has been committed and has not been given material training by the employer in the prevention and detection of money laundering. Article 18 sets out the offence of money laundering under the TL. It is considered inappropriate for those who have not had adequate training to be expected to be able to identify transactions which may be indicative of money laundering.
Disclosure
3. The new Articles 24A-C of the draft Law will have the effect of introducing into the principal Law provisions similar to those in Articles 29-31 of the POCL. The same provisions are being introduced into the DTOL. The new provisions provide an express statutory basis for the disclosure of information by a police officer for particular purposes. Whilst information can be disclosed by a police under established common law principles on police disclosure, it was thought desirable to include express disclosure provisions in both the TL and DTOL, so as to ensure that the position on police disclosure under these Laws is both clear and identifiable, not only to the IMF assessors but also to members of the public for human rights purposes.
Asset Sharing
4. In Jersey’s response to the IMF’s 2003 Assessment it was stated, in relation to ‘International Cooperation’:
“73. The authorities emphasize that both the Proceeds of Crime ( Jersey ) Law 1999 (Article 24) and Drug Trafficking ( Jersey ) Law 1988 (Article 14A) already provide for the sharing of confiscated assets. As noted in the assessment, where there is no legislative provision for sharing confiscated assets (as under the TL) Jersey is able to reach, and in fact has reached, agreement with other jurisdictions on a case by case basis. Jersey has opened preliminary negotiations with Canada and the United States of America with regard to an asset sharing agreement.
74. Notwithstanding this, consideration will be given to amending the TL to introduce provisions facilitating the sharing of assets.”
5. Due consideration has been given and the draft amendment to paragraph 1 of Schedule 3 provides for the proceeds of assets forfeited in relation to terrorist offences to be realised by the Viscount and paid into the POCL’s Criminal Offences Confiscations Fund. Once in the Criminal Offences Confiscation Fund, the proceeds may be utilised for fulfilling Jersey’s obligations in relation to asset sharing agreements.
Enforcement of External Confiscation Orders
6. Recommendation 38 of the Financial Action Task requires countries to have appropriate laws and procedures in place to provide an effective and timely response to mutual legal assistance.
7. Currently the provision of assistance to another jurisdiction to enable the enforcement of an external restraint or forfeiture order under the TL is conditional on that jurisdiction being listed, currently in the Terrorism (Enforcement of External Order) (Jersey) Regulations 2003, as a designated country or territory to whom assistance can be given. The same is true in relation to the enforcement of an external confiscation order under the POCL, the enforcement of an external confiscation order under the DTOL and the enforcement of an overseas forfeiture order under the Criminal Justice (International Co-operation) (Jersey) Law, 2001 (“CJICL”).
8. Under the draft Law, the enforcement of an external restraint or forfeiture order under the Law will no longer be conditional on countries or territories being designated. The amendments enable external forfeiture or restraint orders from any jurisdiction to be capable of being registered by the Royal Court. Regulation 6 of the Terrorism (Enforcement of External Order) (Jersey) Regulations 2003 provides that the Royal Court may register an external forfeiture order if -
(a) it is satisfied that at the time of registration the order is in force and not subject to appeal;
(b) it is satisfied, where the person against whom the order is made did not appear in the proceedings in which the relevant order was made, that the person received notice of the proceedings in sufficient time to enable that person to defend them; and
(c) it is of the opinion that enforcing the order in Jersey would not be contrary to the interests of justice.
9. Regulation 7 of the Regulations provides that the Royal Court may register an external restraint order if -
(a) it is satisfied that at the time of registration the order is in force; and
(b) it is of the opinion that enforcing the order in Jersey would not be contrary to the interests of justice.
10. Regulation 7(2) provides that an external restraint order may only be registered where –
(a) proceedings have been instituted against a person in a designated country, the proceedings have not been concluded, and either an external forfeiture order has been made in the proceedings or it appears to the Royal Court that there are reasonable grounds for thinking that such an order may be made in those proceedings; or
(b) proceedings are to be instituted against a person in a designated country and there are reasonable grounds for thinking that an external forfeiture order may be made in those proceedings.
11. Draft Regulations replacing those which already exist will soon be debated. The provisions contained in the Regulations will remain substantively the same. It is intended that the only changes to the Regulations which will be pursued are those necessary in order to remove any references currently made to designated countries or territories. No changes to the conditions under which the Royal Court may register such orders will be made. Similar amendments are being made to the POCL, DTOL and CJICL.
12. Whilst the notion of providing assistance to only designated countries or territories is thought unlikely to receive adverse comment by the International Monetary Fund, the list of designated countries has not been kept up to date in recent years and it is thought highly likely that Jersey will be criticised for not giving “effective” mutual legal assistance because of this. Whilst compliance with FATF Recommendation 38 in this regard could possibly be achieved by updating the list of designated countries or territories, it is considered that the better solution would be to abandon the list of countries and offer assistance to jurisdictions on a case by case basis. Indeed this is the approach that has been adopted in regards to the UK legislation, on which the relevant Jersey legislation was originally based.
Financial/Manpower Implications –
It is not possible to predict the resource implications of the proposed new Law with any accuracy, but a significant increase in resource requirements would seem unlikely. The situation will be monitored post implementation.
Human Rights -
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