Terrorist Asset-Freezing (Amendment of Law) (Jersey) Regulations 2015

Information about the publication of Ministerial Decisions

A formal published “Ministerial Decision” is required as a record of the decision of a Minister (or an Assistant Minister where they have delegated authority) as they exercise their responsibilities and powers.

Ministers are elected by the States Assembly and have legal responsibilities and powers as “corporation sole” under the States of Jersey Law 2005 by virtue of their office and in their areas of responsibility, including entering into agreements, and under any legislation conferring on them powers.

An accurate record of “Ministerial Decisions” is vital to effective governance, including:

demonstrating that good governance, and clear lines of accountability and authority, are in place around decisions-making – including the reasons and basis on which a decision is made, and the action required to implement a decision
providing a record of decisions and actions that will be available for examination by States Members, and Panels and Committees of the States Assembly; the public, organisations, and the media; and as a historical record and point of reference for the conduct of public affairs

Ministers are individually accountable to the States Assembly, including for the actions of the departments and agencies which discharge their responsibilities.

The Freedom of Information Law (Jersey) Law 2011 is used as a guide when determining what information is be published. While there is a presumption toward publication to support of transparency and accountability, detailed information may not be published if, for example, it would constitute a breach of data protection, or disclosure would prejudice commercial interest.

A decision made 9 February 2015:

MINISTERIAL DECISION REFERENCE: MD-ER–2015-0010
DECISION SUMMARY TITLE: Terrorist Asset-Freezing (Amendment of Law) (Jersey) Regulations 2015
DECISION SUMMARY AUTHOR:	External Relations	IS THE DECISION SUMMARY PUBLIC OR EXEMPT?		Public
REPORT TITLE: Terrorist Asset-Freezing (Amendment of Law) (Jersey) Regulations 2015
REPORT AUTHOR OR NAME OF PERSON GIVING REPORT: (if different from Decision Summary Author)	External Relations	IS THE REPORT PUBLIC OR EXEMPT		Public
DECISION AND REASON FOR THE DECISION: The Minister for External Relations lodged the Terrorist Asset-Freezing (Amendment of Law) (Jersey) Regulations 2015 and accompanying Report dated 3 February 2015. Further to review of the legislation for the prevention of terrorism financing and to enable terrorist asset-freezing, two amendments to the Terrorism Asset-Freezing (Jersey) Law 2011 (“TAFJL”) were proposed, as follows: To clarify the interpretation of ‘ownership’ or ‘control’ of funds, so that the terms explicitly included any funds that were jointly or co-owned, or indirectly owned, or controlled by a designated person. The purpose of this change would be to eliminate any potential uncertainty regarding the extent of assets that must be frozen under the TAFJL. To amend the description of a ‘designated person’, so that it included a person who had been listed by a United Nations Sanctions Committee established in pursuance of UNSCRs 1373 (2001), UNSCR 1267 (1999), UNSCR 1988 (2011) or 1989 (2011). This change would affect an asset freeze in Jersey immediately that a person or entity is listed by the relevant UN terrorist Sanctions Committee, prior to any EU Regulation and without the need for further Jersey asset-freezing legislation. Article 40 of the TAFJL provided that “(1) The States may by Regulations amend the Schedule and any of Articles 1, 2, 3, 4, 5, 6 and 8.” of the Law.
RESOURCE IMPLICATIONS: There are no resource implications arising from the decision.
ACTION REQUIRED: External Relations shall – inform the Greffe of the decision; forward the draft Regulations and Report to be lodged as soon as possible.
SIGNATURE:			POSITION: Minister for External Relations

DATE SIGNED			EFFECTIVE DATE OF THE DECISION

Terrorist Asset-Freezing (Amendment of Law) (Jersey) Regulations 2015

MD-ER-2015-0010

REPORT

Terrorist Asset-Freezing (Amendment of Law) (Jersey) Regulations 2015

Background

The Terrorist Asset Freezing (Jersey) Law 2011 (“TAFJL”) was introduced to address perceived weaknesses in Jersey’s measures to prevent the potential financing of terrorism. Those concerns arose indirectly from the UK Supreme Court judgment in the case of HM Treasury v. Ahmed (2010), declaring the Terrorism (United Nations Measures) Order 2006 and article 3(1)(b) of the Al-Qaida and Taliban (United Nations Measures) Order 2006 to be ultra vires. Consequently, it has been proposed, in due course, to seek revocation of the Al-Qa’ida and Taliban (United Nations Measures – Channel Islands) Order 2002.

The TAFJL requires that the assets of a designated person or entity must be frozen. ‘Freezing’ means that no person may deal in any way with funds or economic resources which are, or are suspected to be, owned, held or controlled by a designated person.

For the purposes of the TAFJL, a ‘designated person’ is –

(a) A person designated by the Minister for External Relations because the Minister considers it is necessary to protect the public from terrorism and reasonably suspects or believes the person is or has been involved in terrorist activity, or is acting on behalf of such a person;

(b) A person designated under the UK Terrorist Asset-Freezing etc. Act 2010;

(c) A person included in the list published in accordance with Council Regulation (EC) No 2580/2001 on specific restrictive measures against certain persons and entities with a view to combating terrorism.

Issues

Amendments to the TAFJL are proposed to address two issues:

Definition of funds ‘owned, held or controlled’ by a person

The Council of Europe [1] Moneyval mutual assessment review of Jersey’s financial services regulation took place from 18-24 January 2015. Following the assessment, the review team has provided preliminary findings for consideration by the Jersey authorities.

Amongst a number of positive observations on the implementation of terrorist asset-freezing legislation, the preliminary findings included a recommendation that the relevant terrorist legislation should expressly extend the definition of funds subject to freezing to cover assets ‘jointly’ or ‘indirectly’ owned, held or controlled by the relevant persons.

Implementation of UN Security Council terrorist listings

Jersey is included as a territory to which the United Kingdom’s ratification of the United Nations Charter (1945) applies, and is thereby obliged to implement UN Security Council Resolutions to the extent that these fall within the domestic competence of Jersey.

The UN Security Council has, by Resolutions (“UNSCR”) 1373 (2001), UNSCR 1267 (1999) and subsequent Resolutions including UNSCR 1988 (2011) and 1989 (2011), established Committees responsible for the listing of individuals and entities linked with Al Qaida and the Taliban and other terrorist organisations.

The United Kingdom, and other members of the European Union, comply with their UN terrorism sanctions obligations by the implementation of EU restrictive measures:

Council Regulation (EC) No 2580/2001 of 27 December 2001 on specific restrictive measures directed against certain persons and entities with a view to combating terrorism, which implements UNSCR 1373 (2001);
Council Regulation (EC) No 881/2002 of 27 May 2002 imposing certain specific restrictive measures directed against certain persons and entities associated with the Al-Qaida network, which implements UNSCRs 1267 (1999), 1373 (2001) and 1989 (2011); and
Council Regulation (EU) No 753/2011 of 1 August 2011 concerning restrictive measures directed against certain individuals, groups, undertakings and entities in view of the situation in Afghanistan, which implements UNSCRs 1267 (1999) and 1988 (2011).

The TAFJL includes asset-freezing measures, inter alia, in respect of any person designated by Council Regulation (EC) No 2580/2001.

In addition, in accordance with the common external relations policy of the Council of Ministers, the Minister for External Relations has introduced legislation to give effect to the designation of individuals and entities under EU restrictive measures 881/2002 and 753/2011.

However, due to the legislative process involved in drafting and approving an EU Regulation, there is frequently a delay of several days or longer between the UN Sanctions Committee listing and the EU designation of a person or entity. As a result, there is a risk of ‘asset flight’, i.e. if the listed person or entity is able to remove the relevant assets from the EU or Jersey before the necessary legislation can be brought into force.

Proposed amendments

The proposed amendments to the TAFJL would:

(1) Clarify the interpretation of ‘ownership’ or ‘control’ of funds, so that the terms would explicitly include any funds that were jointly or co-owned, or indirectly owned, or controlled by a designated person. The purpose of this change would be to eliminate any potential uncertainty regarding the extent of assets that must be frozen under the TAFJL.

The proposed amendment would clarify the range of assets that must be frozen under Article 13, and also clarify the extent of assets on which information must be disclosed to the Minister under Article 22 of the TAFJL.

(2) Amend the description of a ‘designated person’, so that it included a person who has been listed by a United Nations Sanctions Committee established in pursuance of UNSCRs 1373 (2001), UNSCR 1267 (1999), UNSCR 1988 (2011) or 1989 (2011). This change would affect an asset freeze in Jersey immediately that a person or entity is listed by the relevant UN terrorist Sanctions Committee, prior to any EU Regulation and without the need for further Jersey asset-freezing legislation.

Manpower and resource implications

The proposed amendments have no manpower or resource implications.

External Relations

3 February 2015

[1] The Council of Europe is the international organisation founded in 1949, promoting co-operation between all countries of Europe in the areas of legal standards, human rights, democratic development, the rule of law and cultural co-operation.