On 20 July 2023, HM Government published its annual report on the UK strategic export controls (the “Annual Report”) for the reporting period January to December 2022, a day after its presentation to Parliament. The Annual Report provides a summary on the UK export controls and licensing regime, and reports on key statistics for the reporting period. Below, we have summarised some key takeaways.
Standard Individual Export Licences
In 2022, the ECJU processed 17,204 Standard Individual Export Licence (“SIEL”) applications with 16,664 of these applications received within the reporting period. It is reported that 62% of these applications were completed within 20 working days falling short of the government’s 70% target. The median processing time for SIELs was 16 working days. The key results are as follows:
- 13,188 licences were issued;
- 423 applications were denied;
- 1,220 applications were withdrawn or stopped;
- 2,373 applications where no licence was required; and
- 103 licences were revoked.
Individual Professional and Business Services Licences
Under the UK Russia sanctions regime, trade prohibitions relating to the provision of sector-specific professional and business services were introduced on 21 July 2022 and 16 December 2022. DIT issued 25 Individual Professional and Business Services Licences and denied 4 applications.
Financial Services, Brokering Services and Technical Assistance Licences
Under the UK (and previously EU) Russia sanctions regime, there has since 2014 been a prohibition on brokering services, and providing financial services and funds in relation to the supply of energy-related goods used in the oil and gas industry and relating to restricted goods and technology. Similar restrictions apply to other goods restricted by UK sanctions.
DIT issued the following Financial Services, Brokering Services and Technical Assistance Licences:
- 14 Standard Individual Financial Services Licences relating to the supply of energy-related goods;
- 1 Financial Services Licence relating to restricted goods and restricted technology was issued;
- 9 Brokering Services Licences relating to the supply of energy-related goods; and
- 3 Financial Services, Brokering Services and Technical Assistance services licences relating to cover multiple services related to restricted goods and restricted technology.
Enforcement Activity
HMRC, Border Force and the UK prosecution authorities worked together to undertake the following enforcement activities:
- 177 seizures of strategic goods where goods presented for export were found to be in breach of licensing requirements or sanctions and embargoes; and
- 157 end-use cases where there was a risk that non-listed items would be put to an illicit military or WMD end-use were stopped from leaving the UK and brought within export controls.
HMRC undertook 177 strategic exports and sanctions seizures. It is reported to have received 317 voluntary disclosures in 2022 and took the following actions in regards to them:
- 14 criminal investigations were undertaken with one resulting in prosecution;
- 22 compound settlements were reached totalling £6,900,587.14. In these settlements, HMRC made offers in lieu of a referral to a prosecuting authority for the consideration of a charge in cases involving unlicensed exports of military goods, dual-use goods and related activity controlled by the Export Control Order 2008;
- 123 warning letters were issued; and
- no further action was taken in 61 cases.
