The Haiti (Sanctions) Regulations 2022

• (6) The provisions of CEMA are sections 145, 146, 147, 148(1), 150, 151, 152, 154 and 155³⁴ (legal proceedings).

Trade offences in CEMA: modification of penalty

46

• (1) Paragraph (2) applies where a person is guilty of an offence under section 68(2) of CEMA in connection with the prohibition mentioned in regulation 15(1) (export of military goods).

• (2) Where this paragraph applies, the reference to 7 years in section 68(3)(b) of CEMA³⁵ is to be read as a reference to 10 years.

• (3) Paragraph (4) applies where a person is guilty of an offence under section 170(2) of CEMA in connection with the prohibition mentioned in regulation 15(1).

• (4) Where this paragraph applies, the reference to 7 years in section 170(3)(b) of CEMA³⁶ is to be read as a reference to 10 years.

Application of Chapter 1 of Part 2 of the Serious Organised Crime and Police Act 2005

47

Chapter 1 of Part 2 of the Serious Organised Crime and Police Act 2005 (investigatory powers)³⁷ applies to any offence under Part 3 (Finance) or regulation 30 (finance: licensing offences).

Monetary penalties

48

The following provisions are to be regarded as not being financial sanctions legislation for the purposes of Part 8 of the Policing and Crime Act 2017³⁸—

• (a) regulation 17(1) (making military goods and military technology available);

• (b) regulation 18(1)(b) (transfer of military technology);

• (c) regulation 20(1) and (2) (financial services relating to military goods and military technology);

• (d) regulation 21(1)(f)(i) and (g) (brokering services relating to financial services and funds);

• (e) regulation 22(1) (enabling or facilitating the conduct of armed hostilities).

PART 8 — Maritime enforcement

Exercise of maritime enforcement powers

49

• (1) A maritime enforcement officer may, for a purpose mentioned in paragraph (2) or (3), exercise any of the maritime enforcement powers in relation to—

• (a) a British ship in foreign waters or international waters,

• (b) a ship without nationality in international waters, or

• (c) a foreign ship in international waters,

and a ship within sub-paragraph (a), (b) or (c) is referred to in this Part as “a relevant ship”.

• (2) The maritime enforcement powers may be exercised for the purpose of enforcing any of the following—

• (a) the prohibition in regulation 15(1) (export of military goods);

• (b) the prohibition in regulation 16(1) (supply and delivery of military goods);

• (c) the prohibition in regulation 17(1) (making military goods and military technology available);

• (d) the prohibition in regulation 18(1)(a) or (b) (transfer of military technology);

• (e) the prohibition imposed by a condition of a trade licence in relation to a prohibition mentioned in sub-paragraphs (a) to (d).

• (3) The maritime enforcement powers may also be exercised in relation to a relevant ship for the purpose of—

• (a) investigating the suspected carriage of relevant goods on the ship, or

• (b) preventing the continued carriage on the ship of goods suspected to be relevant goods.

• (4) In this Part, “the maritime enforcement powers” are the powers conferred by regulations 51 (power to stop, board, search etc.) and 52 (seizure power).

• (5) This regulation is subject to regulation 53 (restrictions on exercise of maritime enforcement powers).

Maritime enforcement officers

50

• (1) The following persons are “maritime enforcement officers” for the purposes of this Part—

• (a) a commissioned officer of any of His Majesty’s ships;

• (b) a member of the Ministry of Defence Police (within the meaning of section 1 of the Ministry of Defence Police Act 1987³⁹);

• (c) a constable—

• (i) who is a member of a police force in England and Wales,

• (ii) within the meaning of section 99 of the Police and Fire Reform (Scotland) Act 2012⁴⁰, or

• (iii) who is a member of the Police Service of Northern Ireland or the Police Service of Northern Ireland Reserve;

• (d) a special constable—

• (i) appointed under section 27 of the Police Act 1996⁴¹,

• (ii) appointed under section 9 of the Police and Fire Reform (Scotland) Act 2012, or

• (iii) in Northern Ireland, appointed by virtue of provision incorporating section 79 of the Harbours, Docks, and Piers Clauses Act 1847⁴²;

• (e) a constable who is a member of the British Transport Police Force;

• (f) a port constable, within the meaning of section 7 of the Marine Navigation Act 2013⁴³, or a person appointed to act as a constable under provision made by virtue of section 16 of the Harbours Act 1964⁴⁴;

• (g) a designated customs official within the meaning of Part 1 of the Borders, Citizenship and Immigration Act 2009 (see section 14(6) of that Act)⁴⁵;

• (h) a designated NCA officer who is authorised by the Director General of the National Crime Agency (whether generally or specifically) to exercise the powers of a maritime enforcement officer under this Part.

• (2) In this regulation, “a designated NCA officer” means a National Crime Agency officer who is either or both of the following—

• (a) an officer designated under section 10 of the Crime and Courts Act 2013⁴⁶ as having the powers and privileges of a constable;

• (b) an officer designated under that section as having the powers of a general customs official.

Power to stop, board, search etc.

51

• (1) This regulation applies if a maritime enforcement officer has reasonable grounds to suspect that a relevant ship is carrying prohibited goods or relevant goods.

• (2) The officer may—

• (a) stop the ship;

• (b) board the ship;

• (c) for the purpose of exercising a power conferred by paragraph (3) or regulation 52 (seizure power), require the ship to be taken to, and remain in, a port or anchorage in the United Kingdom or any other country willing to receive it.

• (3) Where the officer boards a ship by virtue of this regulation, the officer may—

• (a) stop any person found on the ship and search that person for—

• (i) prohibited goods or relevant goods, or

• (ii) any thing that might be used to cause physical injury or damage to property or to endanger the safety of any ship;

• (b) search the ship, or any thing found on the ship (including cargo) for prohibited goods or relevant goods.

• (4) The officer may—

• (a) require a person found on a ship boarded by virtue of this regulation to provide information or produce documents;

• (b) inspect and copy such information or documents.

• (5) The officer may exercise a power conferred by paragraph (3)(a)(i) or (b) only to the extent reasonably required for the purpose of discovering prohibited goods or relevant goods.

• (6) The officer may exercise the power conferred by paragraph (3)(a)(ii) in relation to a person only where the officer has reasonable grounds to believe that the person might use a thing to cause physical injury or damage to property or to endanger the safety of any ship.

• (7) The officer may use reasonable force, if necessary, in the exercise of any power conferred by this regulation.

Seizure power

52

• (1) This regulation applies if a maritime enforcement officer is lawfully on a relevant ship (whether in exercise of the powers conferred by regulation 51 (power to stop, board, search etc.) or otherwise).

• (2) The officer may seize any of the following which are found on the ship, in anything found on the ship, or on any person found on the ship—

• (a) goods which the officer has reasonable grounds to suspect are prohibited goods or relevant goods, or

• (b) things within regulation 51(3)(a)(ii).

• (3) The officer may use reasonable force, if necessary, in the exercise of any power conferred by this regulation.

Restrictions on exercise of maritime enforcement powers

53

• (1) The authority of the Secretary of State is required before any maritime enforcement power is exercised in reliance on regulation 49 (exercise of maritime enforcement powers) in relation to—

• (a) a British ship in foreign waters, or

• (b) a foreign ship in international waters.

• (2) In relation to a British ship in foreign waters other than the sea and other waters within the seaward limits of the territorial sea adjacent to any relevant British possession, the Secretary of State may give authority under paragraph (1) only if the State in whose waters the power would be exercised consents to the exercise of the power.

• (3) In relation to a foreign ship in international waters, the Secretary of State may give authority under paragraph (1) only if—

• (a) the home state has requested the assistance of the United Kingdom for a purpose mentioned in regulation 49(2) or (3),

• (b) the home state has authorised the United Kingdom to act for such a purpose, or

• (c) the United Nations Convention on the Law of the Sea 1982⁴⁷ or a UN Security Council Resolution otherwise permits the exercise of the power in relation to the ship.

Interpretation of Part 8

54

• (1) Subject to paragraph (2), any expression used in this Part and in section 19 or 20 of the Act has the same meaning in this Part as it has in section 19 or (as the case may be) section 20 of the Act.

• (2) For the purpose of interpreting any reference to “prohibited goods” or “relevant goods” in this Part, any reference in section 19 or 20 of the Act to a “relevant prohibition or requirement” is to be read as a reference to any prohibition specified in regulation 49(2) (a) to (c) (exercise of maritime enforcement powers).

PART 9 — Supplementary and final provision

Notices

55

• (1) This regulation applies in relation to a notice required by regulation 29 (Treasury licences) or regulation 29A (trade licences) to be given to a person.

• (2) The notice may be given to an individual—

• (a) by delivering it to the individual,

• (b) by sending it to the individual by post addressed to the individual at his or her usual or last-known place of residence or business, or

• (c) by leaving it for the individual at that place.

• (3) The notice may be given to a person other than an individual—

• (a) by sending it by post to the proper officer of the body at its principal office, or

• (b) by addressing it to the proper officer of the body and leaving it at that office.

• (4) The notice may be given to the person by other means, including by electronic means, with the person’s consent.

• (5) In this regulation, the reference in paragraph (3) to a “principal office”—

• (a) in relation to a registered company, is to be read as a reference to the company’s registered office;

• (b) in relation to a body incorporated or constituted under the law of a country other than the United Kingdom, includes a reference to the body’s principal office in the United Kingdom (if any).

• (6) In this regulation—

• “proper officer”—in relation to a body other than a partnership, means the secretary or other executive officer charged with the conduct of the body’s general affairs, andin relation to a partnership, means a partner or a person who has the control or management of the partnership business;

• “registered company” means a company registered under the enactments relating to companies for the time being in force in the United Kingdom.

Trade: overlapping offences

56

A person is not to be taken to commit an offence under the Export Control Order 2008 if the person would, in the absence of this regulation, commit an offence under both—

• (a) article 34 of that Order⁴⁸, and

• (b) any provision of Part 4 (Trade).

SCHEDULE 1 — Rules for interpretation of regulation 7(2)

Application of Schedule

1

• (1) The rules set out in the following paragraphs of this Schedule apply for the purpose of interpreting regulation 7(2) (meaning of “owned or controlled directly or indirectly” in Part 3).

• (2) They also apply for the purpose of interpreting this Schedule.

Joint interests

2

If two or more persons each hold a share or right jointly, each of them is treated as holding that share or right.

Joint arrangements

3

• (1) If shares or rights held by a person and shares or rights held by another person are the subject of a joint arrangement between those persons, each of them is treated as holding the combined shares or rights of both of them.

• (2) A “joint arrangement” is an arrangement between the holders of shares or rights that they will exercise all or substantially all the rights conferred by their respective shares or rights jointly in a way that is pre-determined by the arrangement.

• (3) “Arrangement” has the meaning given by paragraph 12.

Calculating shareholdings

4

• (1) In relation to a person who has a share capital, a reference to holding “more than 50% of the shares” in that person is to holding shares comprised in the issued share capital of that person of a nominal value exceeding (in aggregate) 50% of that share capital.

• (2) In relation to a person who does not have a share capital—

• (a) a reference to holding shares in that person is to holding a right or rights to share in the capital or, as the case may be, profits of that person;

• (b) a reference to holding “more than 50% of the shares” in that person is to holding a right or rights to share in more than 50% of the capital or, as the case may be, profits of that person.

Voting rights

5

• (1) A reference to the voting rights in a person is to the rights conferred on shareholders in respect of their shares (or, in the case of a person not having a share capital, on members) to vote at general meetings of the person on all or substantially all matters.

• (2) In relation to a person that does not have general meetings at which matters are decided by the exercise of voting rights—

• (a) a reference to holding voting rights in the person is to be read as a reference to holding rights in relation to the person that are equivalent to those of a person entitled to exercise voting rights in a company;

• (b) a reference to holding “more than 50% of the voting rights” in the person is to be read as a reference to holding the right under the constitution of the person to block changes to the overall policy of the person or to the terms of its constitution.

6

In applying regulation 7(2) and this Schedule, the voting rights in a person are to be reduced by any rights held by the person itself.

Rights to appoint or remove members of the board

7

A reference to the right to appoint or remove a majority of the board of directors of a person is to the right to appoint or remove directors holding a majority of the voting rights at meetings of the board on all or substantially all matters.

8

A reference to a board of directors, in the case of a person who does not have such a board, is to be read as a reference to the equivalent management body of that person.

Shares or rights held “indirectly”

9

• (1) A person holds a share “indirectly” if the person has a majority stake in another person and that other person—

• (a) holds the share in question, or

• (b) is part of a chain of persons—

• (i) each of whom (other than the last) has a majority stake in the person immediately below it in the chain, and

• (ii) the last of whom holds the share.

• (2) A person holds a right “indirectly” if the person has a majority stake in another person and that other person—

• (a) holds that right, or

• (b) is part of a chain of persons—

• (i) each of whom (other than the last) has a majority stake in the person immediately below it in the chain, and

• (ii) the last of whom holds that right.

• (3) For these purposes, a person (“A”) has a “majority stake” in another person (“B”) if—

• (a) A holds a majority of the voting rights in B,

• (b) A is a member of B and has the right to appoint or remove a majority of the board of directors of B,

• (c) A is a member of B and controls alone, pursuant to an agreement with other shareholders or members, a majority of the voting rights in B, or

• (d) A has the right to exercise, or actually exercises, dominant influence or control over B.

• (4) In the application of this paragraph to the right to appoint or remove a majority of the board of directors, a person (“A”) is to be treated as having the right to appoint a director if—

• (a) any person’s appointment as director follows necessarily from that person’s appointment as director of A, or

• (b) the directorship is held by A itself.

Shares held by nominees

10

A share held by a person as nominee for another is to be treated as held by the other (and not by the nominee).

Rights treated as held by person who controls their exercise

11

• (1) Where a person controls a right, the right is to be treated as held by that person (and not by the person who in fact holds the right, unless that person also controls it).

• (2) A person “controls” a right if, by virtue of any arrangement between that person and others, the right is exercisable only—

• (a) by that person,

• (b) in accordance with that person’s directions or instructions, or

• (c) with that person’s consent or concurrence.

12

“Arrangement” includes—

• (a) any scheme, agreement or understanding, whether or not it is legally enforceable, and

• (b) any convention, custom or practice of any kind.

Rights exercisable only in certain circumstances etc.

13

• (1) Rights that are exercisable only in certain circumstances are to be taken into account only—

• (a) when the circumstances have arisen, and for so long as they continue to obtain, or

• (b) when the circumstances are within the control of the person having the rights.

• (2) But rights that are exercisable by an administrator or by creditors while a person is subject to relevant insolvency proceedings are not to be taken into account while the person is subject to those proceedings.

• (3) “Relevant insolvency proceedings” means—

• (a) administration within the meaning of the Insolvency Act 1986⁴⁹,

• (b) administration within the meaning of the Insolvency (Northern Ireland) Order 1989⁵⁰, or

• (c) proceedings under the insolvency law of another country during which a person’s assets and affairs are subject to the control or supervision of a third party or creditor.

• (4) Rights that are normally exercisable but are temporarily incapable of exercise are to continue to be taken into account.

Rights attached to shares held by way of security

14

Rights attached to shares held by way of security provided by a person are to be treated for the purposes of this Schedule as held by that person—

• (a) where apart from the right to exercise them for the purpose of preserving the value of the security, or of realising it, the rights are exercisable only in accordance with that person’s instructions, and

• (b) where the shares are held in connection with the granting of loans as part of normal business activities and apart from the right to exercise them for the purpose of preserving the value of the security, or of realising it, the rights are exercisable only in that person’s interests.

SCHEDULE 2 — Treasury licences: purposes

Interpretation

1

• (1) In this Schedule—

• “designated person” has the same meaning as it has in Part 3 (Finance);

• “frozen funds or economic resources” means funds or economic resources frozen by virtue of regulation 8 (asset-freeze in relation to designated persons), and any reference to a person’s frozen funds or economic resources is to funds or economic resources frozen as a consequence of the designation of that person for the purposes of that regulation.

• (2) For the purposes of this Schedule, references to a designated person are to be read as including a person (“C”) who is owned or controlled directly or indirectly (within the meaning of regulation 7) by the designated person (“P”).

• (3) When determining for the purposes of paragraph 6 or 7 when C became a designated person, C is to be treated as having become a designated person at the same time as P.

Basic needs

2

• (1) To enable the basic needs of a designated person, or (in the case of an individual) any dependent family member of such a person, to be met.

• (2) In the case of an individual, in sub-paragraph (1) “basic needs” includes—

• (a) medical needs;

• (b) needs for—

• (i) food;

• (ii) payment of insurance premiums;

• (iii) payment of tax;

• (iv) rent or mortgage payments;

• (v) utility payments.

• (3) In the case of a person other than an individual, in sub-paragraph (1) “basic needs” includes needs for—

• (a) payment of insurance premiums;

• (b) payment of reasonable fees for the provision of property management services;

• (c) payment of remuneration, allowances or pensions of employees;

• (d) payment of tax;

• (e) rent or mortgage payments;

• (f) utility payments.

• (4) In sub-paragraph (1)—

• “dependent” means financially dependent;

• “family member” includes—the wife or husband of the designated person;the civil partner of the designated person;any parent or other ascendant of the designated person;any child or other descendant of the designated person;any person who is a brother or sister of the designated person, or a child or other descendant of such a person.

Legal services

3

To enable the payment of—

• (a) reasonable professional fees for the provision of legal services, or

• (b) reasonable expenses associated with the provision of legal services.

Maintenance of frozen funds and economic resources

4

To enable the payment of—

• (a) reasonable fees, or

• (b) reasonable service charges,

arising from the routine holding or maintenance of frozen funds or economic resources.

Extraordinary expenses

5

To enable an extraordinary expense of a designated person to be met.

Pre-existing judicial decisions etc.

6

To enable, by the use of a designated person’s frozen funds or economic resources, the implementation or satisfaction (in whole or in part) of a judicial, administrative or arbitral decision or lien, provided that—

• (a) the funds or economic resources so used are the subject of the decision or lien,

• (b) the decision or lien—

• (i) was made or established before the date on which the person became a designated person, and

• (ii) is enforceable in the United Kingdom, and

• (c) the use of the frozen funds or economic resources does not directly or indirectly benefit any other designated person.

Prior obligations

7

To enable, by the use of a designated person’s frozen funds or economic resources, the satisfaction of an obligation of that person arising under a contract, provided that—

• (a) the obligation arose before the date on which the person became a designated person, and

• (b) no payments are made to another designated person, whether directly or indirectly.

Signed

David Rutley — Parliamentary Under Secretary of State — Foreign, Commonwealth and Development Office — 2022-12-05

Explanatory note

(This note is not part of the Regulations)

EXPLANATORY NOTE

These Regulations are made under the Sanctions and Anti-Money Laundering Act 2018 (c. 13) to give effect to the United Kingdom’s international obligations resulting from United Nations Security Council Resolution 2653 (2022) imposing a sanctions regime in view of the situation in Haiti.

The Regulations provide that those persons designated by the UN as responsible for or complicit in, or having engaged in, directly or indirectly, actions that threaten the peace, security or stability of Haiti are designated for the purposes of these Regulations. Designated persons are subject to various sanctions measures set out in subsequent Parts of the Regulations.

Part 3 of the Regulations provides for designated persons to be made subject to financial sanctions, which include having their funds and/or economic resources frozen.

Part 4 of the Regulations imposes trade restrictions on military goods and military technology and associated services.

The Regulations provide for certain exceptions to this sanctions regime, in particular in relation to financial sanctions (for example to allow for frozen accounts to be credited with interest or other earnings) and also acts done for the purpose of national security or the prevention of serious crime. The Regulations also confer powers on the Treasury to issue licences in respect of activities that would otherwise be prohibited under the financial sanctions. Schedule 2 to these Regulations sets out the purposes pursuant to which the Treasury may issue such licences.

The Regulations prescribe powers for the provision and sharing of information to enable the effective implementation and enforcement of the sanctions regime. The Regulations make it a criminal offence to contravene, or circumvent, any of the prohibitions in these Regulations and prescribe the mode of trial and penalties that apply to such offences. They also provide for the application of similar types of provision in the Customs and Excise Management Act 1979 to certain offences relating to trade.

The Regulations also confer powers on specified maritime enforcement officers to stop and search ships in international and foreign waters for the purpose of enforcing specified trade sanctions and to seize goods found on board ships which are being, or have been, dealt with in contravention, or deemed contravention, of those prohibitions.

An Impact Assessment has not been produced for these Regulations. An Impact Assessment was, however, produced for the Sanctions and Anti-Money Laundering Act 2018 and can be found at:

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/653271/Sanctions_and_Anti-Money_Laundering_Bill_Impact_Assessment_18102017.pdf.

Footnotes

Editorial notes