The current reality is that many business people, particularly from Russia, can awaken to discover that their bank account has been frozen, their business transactions suspended, and their name published on an official government register. This is not a hypothetical worst-case scenario, but rather the stark reality faced by individuals and enterprises subject to United Kingdom sanctions. While sanctions are powerful legal instruments designed to achieve foreign policy and national security objectives, they are not absolute or unchallengeable.
If you find yourself caught in the crosshairs of UK sanctions, understanding your legal rights and the available challenge mechanisms could be the difference between financial ruin and recovery. This blog explores how UK sanctions operate, your rights to contest them, and the practical steps you can take to protect your interests.
Understanding the UK Sanctions Framework
The UK has operated its own independent sanctions regime under the Sanctions and Anti-Money Laundering Act 2018 (SAMLA). This legislation replaced the previous EU sanctions framework and granted UK ministers broad powers to impose financial restrictions, travel bans, and trade limitations.
The Office of Financial Sanctions Implementation (OFSI), operating within HM Treasury, serves as the primary enforcement body. OFSI maintains the UK sanctions list, issues licences for permitted activities, and ensures compliance across the financial sector.
UK sanctions typically take three main forms: asset freezes that block access to bank accounts and property, travel bans preventing entry into the UK, and trade restrictions limiting import and export activities. These measures can devastate personal finances and business operations overnight, making swift legal action essential.
Legitimate Grounds for Challenge
Sanctions are not immune to legal scrutiny. Several grounds exist for mounting a successful challenge, each requiring different evidence and legal strategies.Mistaken identity of factual mistakes represent one of the most straightforward grounds for challenge. Given that sanctions lists often contain limited identifying information, innocent parties with similar names or business interests can become inadvertently targeted. In such cases, providing clear documentary evidence of your distinct identity and legitimate activities can secure prompt removal.
Procedural failures offer another avenue for challenge. The government must follow proper legal processes when imposing sanctions, including consideration of human rights implications and proportionality. Failures in this regard can render sanctions legally invalid.
The Human Rights Act 1998 provides additional protection, particularly regarding the right to property under Protocol 1, Article 1 of the European Convention on Human Rights. Sanctions that disproportionately interfere with fundamental rights without adequate justification may be successfully challenged in court.
Finally, sanctions based on incorrect or outdated evidence are vulnerable to challenge, especially in rapidly evolving political situations where circumstances change quickly.
Routes to Challenge: Administrative and Judicial Options
The UK system provides two primary mechanisms for challenging sanctions: administrative review and judicial review.
Administrative review involves applying directly to the Foreign, Commonwealth and Development Office (FCDO) for designation review. This process requires submitting comprehensive evidence demonstrating why sanctions should be lifted, including identity documentation, financial records, and proof of lawful conduct. While less formal than court proceedings, administrative reviews can achieve quick results when supported by compelling evidence.
If administrative review proves unsuccessful, judicial review in the High Court offers a more robust challenge mechanism. Judicial review scrutinises the legality, rationality, and procedural fairness of government decision-making. The landmark case of Bank Mellat v HM Treasury [2013] demonstrates that even complex sanctions can be successfully overturned when government decision-making is shown to be irrational or procedurally flawed.
Immediate Practical Steps
Time is critical when facing sanctions. Several immediate actions can protect your position and preserve your legal rights.
First, act immediately – deadlines for reviews can be surprisingly short, and delay may prejudice your case. Contact both your bank and a qualified lawyer to understand licence requirements and prevent accidental breaches that could result in criminal liability.
Apply for an OFSI licence to cover essential expenses or business continuity. OFSI can grant licences for basic needs, legal fees, and certain business activities, providing crucial breathing space while pursuing formal challenges.
Gather comprehensive evidence, including corporate documents, transaction records, and identity verification materials. The strength of your proof often determines the success of your challenge, making thorough preparation essential.
Cross-Border Complications
UK sanctions extend beyond British borders, impacting UK nationals and entities worldwide. This extraterritorial scope presents specific challenges for those with assets or business interests in multiple jurisdictions.
Cypriot banks, for example, may act pre-emptively on UK sanctions listings, freezing accounts even before formal designation under Cypriot law. If your assets are held in Cyprus or other EU jurisdictions, coordinated legal action may be necessary to secure the release of assets across multiple legal systems.
Prevention and Risk Management
While this blog focuses on challenging existing sanctions, prevention remains the best strategy. Regular due diligence on business partners, systematic checking of the sanctions list using OFSI’s consolidated list tool, and robust compliance policies can significantly reduce sanctions risk.
Companies engaged in international trade should implement comprehensive sanctions screening procedures and maintain detailed records of all transactions and business relationships. These measures not only reduce the risk of inadvertent sanctions violations but also provide valuable evidence if challenges become necessary.
Taking Action
Every day under sanctions increases the pressure on your finances, business, and reputation. The sooner you act, the greater your chances of reversing the damage. Whether you need to unfreeze assets, challenge an unfair designation, or protect your international holdings, we can move quickly to safeguard your interests.
At Linkilaw Solicitors, we have proven experience in sanctions law, from securing the release of frozen assets to coordinating complex cross-border defence strategies.
