PART 3U.K.Finance

CHAPTER 2U.K.Other financial and investment restrictions

Loans and credit arrangementsU.K.

17.—(1) A person (“P”) must not directly or indirectly grant a relevant loan if P knows, or has reasonable cause to suspect, that P is granting a relevant loan.

(2) A person must not directly or indirectly enter into any arrangement to grant a relevant loan if the person knows, or has reasonable cause to suspect, that the arrangement relates to a relevant loan.

[F1(2A) A person must not make funds or economic resources available to a relevant entity (“E”) where the purposes of making those funds or economic resources available is to enable E to grant a relevant loan on or after 16th December 2022.]

(3) Paragraphs (1) [F2, (2) and (2A)] are subject to [F3Part 7 (Exceptions and licences)].

(4) A person who contravenes a prohibition in paragraph (1) [F4, (2) or (2A)] commits an offence.

(5) In this regulation—

F5...

[F6“category 1 loan” means a loan or credit—

(a)

with a maturity exceeding 30 days,

(b)

made or granted to—

(i)

a person falling within Schedule 2,

(ii)

a person, other than an individual, which is—

(aa)

incorporated or constituted under the law of a non-UK country, and

(bb)

owned F7... by a person within paragraph (i), or

(iii)

a person, other than an individual, acting on behalf or at the direction of a person within paragraph (i) or paragraph (ii), and

(c)

which is first made or granted at any time after IP completion day;

“category 2 loan” means a loan or credit—

(a)

with a maturity exceeding 30 days,

(b)

made or granted to a person, other than an individual, which is—

(i)

incorporated or constituted under the law of any part of the United Kingdom, and

(ii)

owned F8... by a person falling within Schedule 2, and

(c)

which is first made or granted at any time on or after 1st March 2022;

“category 3 loan” means a loan or credit—

(a)

with a maturity exceeding 30 days,

(b)

made or granted to a person, other than an individual, which is—

(i)

connected with Russia,

(ii)

owned F9... by a person within sub-paragraph (i), or

(iii)

a person, other than an individual, acting on behalf or at the direction of a person within paragraph (i) or paragraph (ii),

(c)

[F10which is first made or granted at any time on or after 1st March 2022 but before [F1129th October 2022], and,]

(d)

which is not—

(i)

a category 1 loan, a category 2 loan or a category 4 loan, or

(ii)

a loan made or granted to—

(aa)

a person, other than an individual, which on 1st March 2022 is domiciled in a country other than Russia,

(bb)

a person, other than an individual, which is owned by a person falling within sub-paragraph (aa), or

(cc)

a person, other than an individual, acting on behalf or at the direction of a person within sub-paragraph (aa) or sub-paragraph (bb);

“category 4 loan” means a loan or credit—

(a)

made or granted to the Government of Russia,

(b)

which is first made or granted at any time on or after 1st March 2022;]

[F12“category 5 loan” means a loan or credit—

(a)

with a maturity exceeding 30 days,

(b)

made or granted to a person, other than an individual—

(i)

which is connected with Russia, other than—

(aa)

a person which on [F1329th October 2022] is incorporated or constituted in a country other than Russia, or

(bb)

a person which is owned by a person falling within paragraph (aa),

(ii)

a person which is owned by a person within sub-paragraph (i), or

(iii)

a person which is owned by a person connected with Russia who is an individual,

(c)

which is first made or granted at any time on or after [F1329th October 2022], and

(d)

which is not a category 1 loan, a category 2 loan, a category 3 loan or a category 4 loan.]

[F14“category 6 loan” means a loan or credit—

(a)

made or granted to a relevant entity,

(b)

which is for the purposes of an activity mentioned in regulation 18B(2),

(c)

which is first made or granted at any time on or after 16th December 2022, and

(d)

which is not a category 1 loan, a category 2 loan, a category 3 loan, a category 4 loan or a category 5 loan;]

“non-UK country” means a country that is not the United Kingdom;

[F15“owned” means owned within the meaning of regulation 16(7);]

[F16“relevant entity” has the meaning given in regulation 18B(8);]

[F17“relevant loan” means a category 1 loan, a category 2 loan, a category 3 loan [F18, a category 4 loan [F19, a category 5 loan or a category 6 loan]];]