Russia / Ukraine: Cayman Islands and BVI Sanctions Update – International Law
Worldwide: Russia / Ukraine: Cayman Islands and BVI Sanctions Update
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The Sanctions Orders are extended by statutory instrument to British Overseas Territories, including the Cayman Islands and the British Virgin Islands (the “BVIs”), to give effect to the sanctions regimes implemented by the Government of United Kingdom (“sanctions orders”).
Sanctions orders apply to any person or entity incorporated or instituted in the jurisdiction, as well as any British citizen or subject ordinarily resident in the jurisdiction. Sanctions orders generally prohibit persons from dealing in funds or economic resources owned or controlled by, or making funds or economic resources available to persons or entities listed in the order (“designated persons”). .
The next set of sanctions measures regarding Russia’s invasion of Ukraine are expected to be released by the UK, US and EU this week; some important changes have already been made in recent days. What we know so far about the UK and its overseas territories is briefly summarized below.
All Cayman Islands and BVI entities should ensure they comply with new/amended sanctions orders and ensure they also take note of potentially applicable sanctions imposed by other jurisdictions (including states US and EU) as part of their broader AML/CFT/CPF and Sanctions Compliance Framework.
Important and immediate considerations include how freezing the assets of designated persons will affect inward and outward investment; identification of sanctioned persons, including unlisted persons and entities under the ownership or control of the named persons; statutory reporting obligations; and demonstrate strong sanctions policies and procedures.
Maples Group has significant experience advising on the Cayman Islands and BVI sanctions regimes. If you would like more information, please contact your usual Maples Group contact or one of the people listed below.
Sanctions already imposed in the UK and overseas territories
Several additions have already been made to the UK’s consolidated list, with the effect that their assets are immediately frozen. The entities in question include VTB Bank (the second largest bank in Russia); with figures such as President Putin and Foreign Minister Lavrov. Russia’s national airline, Aeroflot, has been banned from British airspace.
UK and overseas territories sanctions expected this week
The UK Government has announced the following measures, which are expected to come into force and be extended to UK Overseas Territories this week:
- Some Russian banks will be removed from the SWIFT global payment system.
- The Russian Central Bank must be prevented from deploying its international reserves in a way that could undermine sanctions.
- Russian banking assets in the UK will be frozen, with the aim of cutting off the Russian banking system from UK financial markets.
- Prohibition of Russian state-owned companies and key strategic private companies from raising funds on UK financial markets.
- Adding more than 100 businesses and oligarchs to the UK’s consolidated list, leading to asset freezes and travel bans.
- Trade restrictions and export controls against Russian high-tech and strategic industries.
- New restrictions aimed at cutting off wealthy Russians’ access to UK banks (including banning all Russians from having significant savings in UK bank accounts).
- Limitations on the sale of so-called “golden passports” granting Russians British citizenship.
- Similar financial sanctions will be extended to Belarus for its role in the invasion of Ukraine.
The content of this article is intended to provide a general guide on the subject. Specialist advice should be sought regarding your particular situation.
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