All persons designated under the Russia financial sanctions regime have been designated for the purpose of trust services sanctions.
On 21 March 2023 the Foreign, Commonwealth and Development Office updated the UK Sanctions List on GOV.UK. This list provides details of those designated under regulations made under the Sanctions Act.
All persons currently designated under the Russia regime (1,730 entries) have been amended on the Consolidated List and are now subject to trust services sanctions. 7 entries have also been updated to reflect existing further restrictions. The ‘Other Information’ field for all entries has been amended to provide details of further financial restrictions, and the date trust services sanctions were imposed. All entries remain subject to an asset freeze and no further changes have been made to the Consolidated List. Further details can be found in the notice.
Under General Licence INT/2023/2589788, persons may wind down the provision of trust services to a designated person. The permissions under this General Licence apply to persons from the date of designation and will expire at 23:59 on the 90thcalendar day from taking effect for the purposes of Regulation 18C. Note that the expiry date will differ depending on the date for each designation. It may be varied, revoked, or suspended by HM Treasury at any time.
Any persons intending to use the General Licence should first consult the copy of the Licence and refer to OFSI’s general guidance. Persons using the General Licence must report to OFSI within 30 calendar days of undertaking any activity. The relevant reporting form can be found here.
OFSI has also published a blog and updated its Russia guidance to include further information on prohibitions on trust services. The latest guidance can be found here.
OFSI Notice
The new wind down General License for trust services:
and the publication notice:
The blog post:
Trust Services Sanctions update
Posted by: OFSI, Posted on: 21 March 2023 – Categories: Uncategorized
The UK Government remains committed to punishing Russia’s illegal invasion of Ukraine, cutting off funding streams to the Putin regime and stopping those close to the regime from benefitting from western services.
As announced last year, the UK government has acted alongside its international allies to introduce new measures that will prevent Russia from accessing UK trust services. Enforcement agencies suggest there is evidence of UK-based trust and company service providers offering their services to persons to enable them to reduce the impact of sanctions in the event they become subject to them. This forms part of the strongest sanctions regime ever introduced in the UK.
Today, we are further sharpening our sanctions to close off UK trust service providers from providing trust services to designated persons.
The Russia (Sanctions) (EU Exit) Regulations 2019 (“the Regulations”), define trust services as:
The creation of a trust, or similar arrangement;
The provision of a registered office, business address, correspondence address; administrative address for a trust or similar arrangement;
The operation or management of a trust or similar arrangement; or
Acting or arranging for another person to act as a trustee of a trust or similar arrangement.
Since 16th December 2022, it has been prohibited by Regulation 18C (trust services) of the Regulations for a person to provide trust services to or for the benefit of a person connected with Russia (unless those trust services were being provided pursuant to an ongoing arrangement immediately prior to that regulation coming into force).
It is also prohibited to provide trust services to or for the benefit of persons designated for the purposes of Regulation 18C (trust services). Today, on 21st March 2023, the 1730 persons that are currently designated under Regulation 11 (asset freeze) of the Regulations are now also designated under Regulation 18C (trust services). This means that it is now prohibited to provide trust services to or for the benefit of these persons, unless permitted by a licence or there is an applicable exception. FCDO’s UK Sanctions List and OFSI’s Consolidated List have been updated to reflect this.
To support trust service providers wind down their services in relation to designated persons, OFSI has issued General Licence INT/2023/2589788 that allows 90 calendar days to wind down those services. This is effective from the date of designation for the purposes of Regulation 18C of the person to whom the trust services are being provided. For example, for persons designated today on 21st March 2023, the permission to wind down provision of these services will expire at 23:59 on 18th June 2023. Anyone using the General Licence must report to OFSI within 30 calendar days of undertaking any activity under the General Licence. Reporting must include the details of the trust services provided, amongst other things, and evidence should be provided where applicable, and can be completed using this form.
This General Licence is in addition to the existing exceptions and licencing grounds, including the exception to allow trust services to continue to be provided for the purposes of complying with an asset freeze. More information on exceptions and licensing grounds can be found in OFSI’s updated Russia guidance.
Like all UK sanctions measures, the trust services prohibitions also apply across the UK’s Crown Dependencies and Overseas Territories (OTs), with HM Treasury and FCDO supporting on their effective implementation. To ensure that this new measure can be implemented effectively in the OTs, we have made an Order in Council. OTs can issue General Licences with the consent of the Foreign Secretary and a number of OTs may want to mirror OFSI’s General Licence.
OFSI’s updated Russia guidance also provides clarity on how the trust services sanctions interact with other existing sanctions, such as sanctions on professional and business services. Further to that, it confirms that all sanctions on professional and business services continue to apply even when trust services are permitted, unless the professional or business service is permitted by a licence in respect of that professional or business service or there is an applicable exception from the professional or business services sanction.
Mr. Watchlist 
Leave a Reply