The Iran (European Union Financial Sanctions) Regulations 2016

EXPLANATORY NOTE

(This note is not part of the Regulations)

These Regulations make provision relating to the enforcement of Council Regulation (EU) No. No. 2012/267 dated 23rd March 2102 (OJ, L 088 24.3.2012, p.1) concerning restrictive measures against Iran and repealing Regulation EU No. 961/2010 (“the Council Regulation”) as amended most recently by Council Regulation (EU) No. 1861/2015 of 18th October 2015 (OJ L 274, 18.10.2015, p. 1) and Council Regulation (EU) No. 1862/2015 of 18th October 2015 (OJ L 274, 18.10.2015, p. 161) (“the 2015 Council Regulations”).

Following the agreement of the Joint Comprehensive Plan of Action in Vienna on 14th July 2015 providing for sanctions relief for Iran in exchange for Iran verifiably limiting its nuclear programme, the 2105 Council Regulations were adopted to amend the Council Regulation to reduce the restrictive measures it imposed upon Iran. The 2015 Council Regulations enter into force on the date that it is independently verified that Iran has complied with its obligations under the JCPOA. The International Atomic Energy Authority has verified that Iran has so complied, and accordingly the 2015 Council Regulations have entered into force.

These Regulations revoke and replace the Iran (European Union Financial Sanctions) Regulations 2012 (“the 2012 Regulation”), with relevant savings, in order to align the criminal penalties for breaches of the restrictive measures with the Council Regulation as amended by the 2015 Regulations. For the sake of clarity, these Regulations revoke and replace the 2012 Regulations rather than substantially amend those Regulations.

The measures include the freezing of funds and economic resources of designated persons and ensuring that funds and economic resources are not made available to them or for their benefit.

Regulation 2 defines designated persons as any person named in Annex VIII, IX, XIII, or XIV to the Council Regulation (as amended from time to time). These Annexes include those persons listed by the Council of the European Union and the United Nations.

Regulations 3 to 7 provide prohibitions against dealing with the funds or economic resources of a designated person, or making funds or economic resources available, directly or indirectly, to or for the benefit of a designated person.

Regulation 8 provides an exception to the prohibitions in regulations 4 and 5 where a frozen account is credited for a permitted reason.

Regulation 9 provides a licensing procedure to enable funds and economic resources to be exempted from the prohibitions.

Regulation 10 prohibits the provision of specialised financial messaging services to designated persons.

Regulation 11 makes it an offence to breach any of the prohibitions in regulations 3 to 7 and 10, or to seek to circumvent those provisions.

Regulations 12 to 15 contain provision about penalties, proceedings and who, in relation to bodies corporate and other bodies, may be prosecuted for an offence under the Regulations.

Regulation 19 makes a consequential amendment to the Counter-Terrorism Act 2008 c.28. Regulation 20 revokes and repeals the legislation providing for enforcement of the restrictive measures prior to the extensive changes mandated by the JCPOA and given effect by the 2015 Council Regulations. Regulation 21 saves licenses granted under that legislation.

The Schedule makes provision for information gathering and information disclosure and creates offences for failure to comply with a request for information.

A list of designated persons is available on the internet at: www.gov.uk/government/publications/financial-sanctions-consolidated-list-of-targets or can be obtained from Financial Sanctions, H.M. Treasury, 1 Horse Guards Road, London, SW1A 2HQ.

Further information is available from Financial Sanctions, HM Treasury, 1 Horse Guards Road, London, SW1A 2HQ and on the H.M. Treasury website (www.gov.uk/government/organisations/hm-treasury).