As the UK's departure from the EU—Brexit—draws closer, we're asking how compliance teams would need to adapt, particularly in the way they approach sanctions. Anna Bradshaw is a partner with Peters & Peters, a UK law firm specializing in corporate compliance, and she explains what a post-Brexit sanctions policy might look like.
Peters & Peters' Anna Bradshaw explains the new and ongoing challenges for sanctions compliance following Brexit.
Initially, EU sanctions will continue to apply to organizations in the UK, until a minister makes changes to the sanctions lists. Yet compliance teams should be aware of an expansion of reporting obligations that could cover a greater number of businesses and sectors.
"We’re not expecting to see much of a dramatic change, in terms of how breaches are punished or how they are enforced," Bradshaw says. "But we may well see changes to the reporting obligations, which at the moment apply to a relatively limited subset of regulated businesses and professions, as well as the financial sector, that may well expand. It only applies, at present, to breaches of EU financial sanctions—but again, that would be a point that could easily be expanded to cover a much fuller range of sanction violations."
One constant that would remain under Brexit is the need to identify sanctioned entities and understand the ownership of customers or suppliers. This is where information on beneficial ownership becomes vital to staying compliant.
"You always will have a problem knowing who you’re dealing with, whether that’s your customer, whether it’s a third party or indeed someone, one or two steps removed from you," Bradshaw says. "What you do get, if there is dramatic change in law or policy, is a compounding of those practical problems. But in essence, they remain unchanged."