In response to the annexation of Ukrainian provinces by Putin, the UK has announced new sanctions as of 3rd of October.
In response to the annexation of Ukrainian provinces by Putin, the UK has announced new sanctions as of 3rd of October. The UK provides 59% of Russian legal services, and these new measures will cover “transactional legal advisory services” and hamper Russia’s businesses’ ability to operate internationally.
Why is this significant? This is not just sanctioned individuals and entities but any beneficial owner that has Russian citizenship. So beneficial ownership checking and customer due diligence measures are even more critical as Russian individuals can hide behind these opaque and complex structures as owners.
Reporting entities could inadvertently be in breach of UK Sanctions which comes with huge fines and reputational damage. The sanctions are constantly being updated so it is critical that they are being diligent and checking their current and new customer base.
Do note that firms can work with sanctioned individuals/entities, however they will need to apply for a sanctions licence from OFSI (Office of Financial Sanctions Implementation). OFSI has a huge backlog as they are prioritising humanitarian/high sector impact work so sanctions licencing could be heavily delayed.
The HMRC’s release is only an announcement so far with no further detail to hand – we will be waiting for more information and supervisory guidance from bodies such as the Law Society for further information.
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