Sanctions :ownership and control
Ownership and control
The concepts of ownership and control occur in sanctions measures. In October /November 2023 there have been a number of UK cases considering ownership and control concepts .Please click here to access our news item on the Mints judgment of October 2023 in the UK court of appeal and here to read a Institute news item on the Public Officials and Control guidance from HM Treasury of November 2023 and a further high court case Litasco SA Claimant, Der Mond Oil and Gas Africa SA and Locafrique Holding SA. There is also a link to a webinar of 20th Nov 2023 on the subject entitled “Webinar with UK government on sanctions ownership/control”. The webinar was hosted by UK firm Peters & Peters and the UK deputy director of sanctions David Drake and deputy director in OFSI Beth Davis spoke on the topic.
Please see below a chart which contains some detail and comparison of the control concept in the UK and Irish /EU Russia sanctions regimes.
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EU
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UK
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“Control” definition “owned or controlled directly or indirectly”
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Article 1(5) & (6) ofEU Regulation 2580/2001
“50% or more “criteria are updated to “more than 50% “. SeeGuidelines from the EU (2022)
EU commission opinion dated June 2021on individual financial sanctions (control, and making funds or economic resources available)
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The UK sets out the definition of ownership and control within the statutory instrument of each of the sanctions regimes which contains financial sanctions.
The Russia (Sanctions) (EU Exit) Regulations 2019 section 7sets out the meaning of “owned or controlled directly or indirectly”.
Sch 1 of the 2019 Regulations contains rules for interpreting S7.
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Rebuttable presumption of control
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Yes.
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No.
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aggregation
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Yes (for Russia EU sanctions regime).
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No.
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The table above is a tool to provide the reader with a quick reference summary comparator of Irish /EU and UK provisions. It should not be regarded as complete or comprehensive or as a definitive legal interpretation. The law is complex and open to different interpretations and in some instances not particularly well drafted. It also changes fast and is ever evolving. The material is illustrative only and provided in good faith to guide and assist the reader in understanding the obligations in this area but do not purport to be and must not be relied upon by the reader as a definitive or comprehensive legal interpretation.
Firewalling
Please click for a guidance note from the European Commission dated 29 November 2023 on the implementation of firewalls. Guidance note – Implementation of firewalls in cases of EU entities owned or controlled by a designated person or entity Firewalling occurs where an EU entity owned and controlled by a designated person puts a safeguard in place against the designated person preventing them exercising control rights connected to ownership of the EU non designated entity.
These pages are provided as resources and information only and nothing in these pages purports to provide professional advice or definitive legal interpretation(s) or opinion(s) on the applicable legislation or legal or other matters referred to in the pages. If the reader is in doubt on any matter in this complex area further legal or other advice must be obtained. While every reasonable care has been taken by the Institute in the preparation of these pages, we do not guarantee the accuracy or veracity of any resource, guidance, information or opinion, or the appropriateness, suitability or applicability of any practice or procedure contained therein. The Institute is not responsible for any errors or omissions or for the results obtained from the use of the resources or information contained in these pages.
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