The Proceeds of Crime Act 2002 (Investigations in different parts of the United Kingdom) (Amendment) Order 2017

EXPLANATORY NOTE

(This note is not part of the Order)

This Order amends the Proceeds of Crime Act 2002 (Investigations in different parts of the United Kingdom) Order 2003 (S.I. 2003/425) (“the Investigations Order”), which contains the enforcement procedures within the United Kingdom for orders made and search and seizure warrants issued relating to certain investigations under Part 8 of the Proceeds of Crime Act 2002 (c. 29) (“POCA”). The Investigations Order provides the appropriate enforcement procedures where section 18 of the Civil Jurisdiction and Judgments Act 1982 (c. 27) (“CJJA”) (enforcement of UK judgments in other parts of UK) does not apply.

Paragraphs 2(b) and (h) of the Schedule to this Order provide that disclosure orders can be obtained in England and Wales and Scotland in the context of a money laundering investigation, as a result of the amendments made to POCA by sections 7 and 8 of the Criminal finances Act 2017 (c. 22) (“CFA”). These sections removed the restriction preventing disclosure orders from being available in money laundering investigations. These provisions in the CFA are not being commenced in Northern Ireland at this time.

Paragraphs 2(c), (g) and (i), and 3 to 5 of the Schedule to this Order amend the Investigations Order to include references to further information orders (as provided for by section 10 of the CFA) and moratorium extension orders (as provided for by section 12 of the CFA), and to allow them to be given effect in other jurisdictions within the United Kingdom. Under Part 7 of POCA, an entity in the regulated sector (as defined in Schedule 9 to POCA) must report a suspicion of money laundering, and must seek consent from a nominated officer, a constable or a customs officer to carry out a particular related transaction. Where that consent is refused, the entity is currently prohibited from carrying out the transaction for a period of 31 days (“the moratorium period”). Section 10 of the CFA introduces a new power for a senior officer (as defined in section 336D(7) of POCA) to apply to the court for an order extending the moratorium period. This power is not being commenced in Northern Ireland at this time.

Section 12 of the CFA provides for further information orders, which require the respondent in the regulated sector to provide further information relating to a matter arising from a disclosure made under Part 7 of POCA, where that further information would assist in investigating whether a person is engaged in money laundering, or whether an investigation of that kind should be started.

The CFA amends POCA to create two new categories of investigation which support the new powers to forfeit certain listed items of property and to forfeit funds in bank accounts. Law enforcement officers can apply to the relevant court (the magistrates’ court in England and Wales and Northern Ireland and the sheriff’s court in Scotland) for an order under the investigatory powers provisions in Part 8 of POCA. These are detained property investigations and frozen funds investigations respectively (“the new investigations”). Paragraphs 2(a), (d) and (e) of this Order amend the Investigations Order to include references to the new investigations. As with detained cash investigations, the CJJA will not apply in respect of orders obtained under Part 8 of POCA in the new investigations in England and Wales.

Paragraph 2(d) and (e) of the Schedule to this Order provide respectively that production orders and search and seizure warrants made in England and Wales in the course of the new investigations will fall within the definition of “English and Welsh production orders” and “English and Welsh search warrants” in the Investigations Order. No equivalent definition is required for Scotland, as the CJJA will apply where an order is sought under Part 8 of POCA in the course of the new investigations in Scotland, as is currently the case for detained cash investigations. No equivalent provision is needed for Northern Ireland for the reasons set out above.

Paragraph 6 of the Schedule to this Order ensures that the same approach will be taken to applications to vary or discharge orders under Part 8 of POCA which were obtained in the course of the new investigations, and which are to be enforced in a different jurisdiction. The effect of the amendment is that such applications must be made in the jurisdiction in which the order was obtained, in keeping with the approach currently taken for orders in detained cash investigations.

A full impact assessment has not been produced for this instrument as no, or no significant, impact on the private, voluntary or public sectors is foreseen.