Sanctions policy and implementation

With the UK’s departure from the European Union ever closer, attention has focused on the UK’s sanctions policy outside the EU, among other things.

As a member of the EU, the UK derived almost all of its sanctions policy from the EU, implementing sanctions decided at the EU level and using powers in the European Communities Act 1972, including for the many UN-derived sanctions regimes. With the repeal of that act, the legal basis for an independent UK sanctions policy was created by the Sanctions and Anti-Money Laundering Act 2018.

What the UK will do with those powers has been the subject of debate, and an investigation by the House of Commons Foreign Affairs Committee. The Committee started taking evidence in January 2019 and on 12 June published its report: Fragmented and incoherent: the UK's sanctions policy. The Committee concluded that: “… the Government does not have a clear strategy for sanctions. Little high-level thought appears to have been given to UK priorities for post-Brexit sanctions.”

There is also the question of whether the UK’s official bodies that design and implement sanctions have the capacity to develop and carry out the sanctions strategy. These bodies are principally the Foreign and Commonwealth Office and the Treasury, particularly the Office of Financial Sanctions Implementation (OFSI).

The debate on UK sanctions policy and implementation takes place against a fast-changing background. Given that sanctions are largely multilateral, how independent will the UK sanctions regime really be? The legislative framework looks a lot like the US system but the UK’s interests may remain closer to those of neighbours in the EU than those of the US.

UK courts likely to be crucial in shaping policy; it is possible that there will be a big increase in litigation under the new system.

Sanctions, particularly ‘targeted sanctions’ seem to be ever-more popular; disputes over Iran and North Korea’s nuclear programmes bring sanctions to the headlines very regularly.

Whether either broad sanctions or targeted sanctions achieve their objectives is unclear. Analysts used to be united in agreeing that they generally don’t. But recently, a more complex approach to assessing their effectiveness, together with the more complex design of the measures, has led some to change that view and argue that they can be effective.

A new approach is to argue that sanctions have other goals than simply to impose pain on the target country and force that country to choose a different policy. Sanctions can also unite allies and send signals to third parties, for example. And they are also useful because they allow politicians to do something, short of military action.