First Delegated Legislation Committee
Monday 15th June 2026
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Speaker 3
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Speaker 3
Well, thank you, Sir Desmond. And I beg to move that. The committee has approved the Russia Russia sanctions EU Exit Regulations 2026. These amend the Russia sanctions, EU Exit Regulations 2019. And before I begin, Mr. Desmond, I wanted to place on record, I'm sure shared by all colleagues are at a horror at the attacks meted out by Russia in Ukraine yet again in the last 24 hours. In particular, the despicable attack on the monastery in Kyiv and the deaths of civilians across Ukraine.
And I think those show again to the whole House and indeed the whole world, the appalling, barbarous actions that Russia is capable of and continues to do so. And I was able to convey that, um, that that horror and our solidarity and support to the chairman of the Rada this morning, Ruslan Stefanik, who was here as a guest of Mr. Speaker. And I know that he's been meeting other members and right honourable members across the House. Um, we all stand united with Ukraine. I know in this committee, and our thoughts are with all those affected by these terrible actions.
Um, Sir Desmond, this instrument was laid on the 19th of May, and the powers in the Sanctions and Anti-Money Laundering Act 2018, and the measures in the instrument subject to the made affirmative parliamentary procedure, entered into force on 20th of May. Um, Mr. Chair, since coming to power, the government has been clear that Russia must not be allowed to succeed in its illegal war, and we have been steadfast in our support of Ukraine. Russia represents not just a threat to Ukraine, of course, but a threat to the whole of Europe and indeed to the United Kingdom and our allies.
And as part of our response to Russia's illegal and barbarous war in Ukraine, the United Kingdom has sanctioned over 3300 individuals now and entities under the Russian sanctions regime, with over 1300 of those delivered under this government. And just last month, we introduced a new package that sanctioned 18 individuals and entities under the UK's Russia Sanctions regulations, including cryptocurrency exchanges active in Russia, entities and individuals that we suspect are linked to the UK sanctioned a seven network, which is embedded itself in the Kyrgyz financial sector, and this marks a further step in the UK sustained effort to erode Russia's ability to fund its illegal full scale invasion, ramping up pressure on Putin's war chest.
And this, of course, comes as yet another set of measures that we have taken repeatedly under this government. Indeed, continuing the work under the previous government, when I sat on the opposite side, welcoming and showing support for these measures, but also providing robust scrutiny, and these sanctions are having a real impact. Mr. chair, last month, Russia slashed its economic growth forecast for 2026 from 1.3% to just 0.4%, and Russia's deputy prime minister ascribed this downgrade to the impact of sanctions, among other factors. And indeed, Putin himself admitted that Russian GDP contracted by 1.8% in January and February, with a decline in areas that are critical to its war effort, including industrial production.
So it's clear that our sanctions are having an impact. It's clear that they are having bite, and that is why we will not see soon. I won't comment, obviously, on further measures, but we will not cease on exploring all opportunities to raise pressure to degrade Russia's war machine, um for its actions in Ukraine, and to look at all the methods in which they're using to evade those regimes. Um, Mr. Chair, to phase in the implementation of the measures before us today, we issued two targeted licences, which are intended, and I make very clear, as we did um, over many of the questions and debates we've had in this House are a temporary measure.
These licences are subject to ongoing review with fortnightly checkpoints and may be amended, suspended or revoked as appropriate. The first licence is for the new LNG maritime services ban and that temporarily authorised spot market trade from Russian LNG project Sakhalin two and Yamal until the 1st of January 2027, and the second licence applied to the refined oil import ban and authorised imports of diesel and jet fuel refined in third countries. As with the LNG licence, I must reiterate this to the committee. These licences are always intended as a temporary measure.
They are designed to be a measure to mitigate and protect consumers here and market stability, and they are subject to fortnightly reviews, and the process of review involves continually assessing the impact of licences on energy supplies, market conditions and other relevant considerations against our overarching impact, which is, I'm sure, shared by all members of this committee and our overall objective of ramping up pressure on Russia through our sanctions regime. And in light of this assessment, determining what steps are appropriate at each review point, there was, Mr. Chair, some misleading reporting and commentary around the time around these measures.
We were not watering down existing measures. These are new measures. These are measures that many across this House have called for, including myself. When I sat on the opposite side, um, toughening and tightening the pressure on Russia. But it is only appropriate, as often happens with sanctions regimes, that these are phased, that we allow appropriate market stability, and then at the earliest possible opportunity that the bans come in full as part of the review process that has been ongoing since these measures came into place, the government has now also set a clear end date for the refined oil licence of the 1st of January 2027, and that's in line with the liquefied natural gas maritime services band spot licence.
And that sets in the timetable now for fully phasing in the ban and shutting down this remaining route for Russian oil. Regular reviews will continue to ensure the licence is lifted at the earliest possible date, which of course could be before that date. And I will turn to the details in a moment. But I do want to thank the genuine and constructive scrutiny, particularly from Liberal Democrat counterparts and others, and conversations that have been had with members across this House to ensure that we come to the right, um, process of phasing in these measures and that the House that we've been able to communicate as the government on the basis of the review that we set out, how that is going to operate going forward.
And therefore, I hope that these measures will enjoy the wholehearted support of the Committee today, because indeed, as I set out, Mr. Chair, they include a range of different measures. Um, and it's important that all of those are able to go forward. The LNG and refined oil were just part of this overall package. Um the regulations are indeed a strong enhancement of our Russian sanctions regime, Mr. Chair, and to reiterate what the Prime Minister, indeed, my colleague the Minister for trade said on 20th of May, we have not lifted or sanctions.
Our sanctions are now stronger than they were a month ago. And I really do want to underline that point, um, to the committee the legislation is sanctioning previously unsanctioned goods and services, and that includes multiple measures targeting Russia's energy sector and indeed other key suppliers. So firstly, uh, Mr. Chair, we have imposed further export restrictions that fall into the following four categories. Firstly, items sanctioned by the EU already, including certain types of industrial chemicals, metals and machinery that have potential battlefield use goods recommended for sanctions by the government of Ukraine, including additional forms of metals and articles of carbon fibre, which are frequently used in the manufacture of those drones that we have seen causing such devastating impact.
And indeed, I witnessed myself where those drones had hit in Lviv just a few months ago, including again on a religious site in the city centre of Lviv. Absolutely appalling crimes. We need to be choking off the supplies and material that are being used for these drones. A more expansive list of individual chemicals and chemical precursors that might be used in, for example, riot control agents that have been found on the battlefield or goods for internal repression. And indeed, lastly, goods related to emerging technologies, including quantum semiconductor and engineering biology technologies, including new goods and those that are not already clearly subject to existing sanctions.
To reduce the risk of circumvention, as I said, it includes measures on refined oil. The legislation bans the import into the UK of oil products refined in third countries that have been made from Russian crude oil. Maritime services ban on LNG, which is a new maritime services ban and that restricts Russia's access to the UK's world leading maritime services, which again, is an issue that has been rightly raised on a number of occasions by colleagues across the House. Certain existing long term contracts are exempt from these provisions until the end of the year, and that is, I would point out, in line with the EU's LNG measure, we always attempt to work alongside our EU and other counterparts on this um for appropriate effect.
There is also a ban on the import of uranium. And this bans the import of uranium, which is consigned from Russia and uranium, which originates in Russia and restricts UK involvement in the global trade of Russian uranium. Exceptions are in place to mitigate risks to energy security in third countries, including to the supply of uranium to operational nuclear installations. Construction services is another area where this package takes action. Mr. chair, the legislation introduces a prohibition on providing construction services to persons connected with Russia, and that will complement the other restrictions we have in place on architecture and engineering, ensuring that UK construction businesses cannot support infrastructure and building projects which benefit Russia.
We've also introduced new criteria, expanded criteria for specifying ships, and members will have seen the very robust action, the brave action that our armed forces and law enforcement personnel took over the weekend. We will not hesitate to use measures to enforce international law and enforce action against those that Russia is attempting to use to circumvent, whether that's a vessel or another means to circumvent restrictions we are putting in place. And I pay tribute to all of those involved in that crucially important operation. But members will understand.
I won't go into further operational details today because of the nature of that, and I know questions have been raised on the on the floor as well of the main chamber. But in the new expanded criteria, we have specified ships to include ships carrying liquefied natural gas that originated in Russia and indeed, ships carrying coal and coal products that originated in Russia. And the aim of this is to make it easier to sanction ships for a wider range of activity. We've also strengthened the trade and shipping sanctions, which can be applied to specified ships by introducing additional prohibitions.
And the new trade sanctions enable the government to prohibit persons from providing and procuring certain maritime and financial services in relation to specified ships and indeed, additional shipping sanctions in this package prohibit persons from operating or chartering specified ships and require that the UK Shipping Register, who maintains the UK Ship Register, which is part of the Maritime and Coastguard Agency, refused to register specified ships. Lastly, Mr. Chair, the legislation will close a gap by prohibiting the acquisition and purported acquisition of a detained transport asset from or for the benefit of a designated for the benefit of a designated person or person connected with Russia.
And that instrument amends the enforcement provisions of the 2019 regulations, as well as the trade, aircraft and shipping Sanctions of Regulations 2024 to provide for the enforcement of the new prohibitions introduced by these regulations. So, Sir Desmond, to conclude, this is a wide ranging, impactful package which shows that the government takes incredibly seriously our commitment to supporting Ukraine and to targeting Russia for its actions in prosecuting its illegal and barbarous war in Ukraine, and to combat Putin's attempts to prolong this war and to do further damage and further death and destruction that he has been meting out, as we've seen so tragically, just in the last 24 hours, our sanctions have hit Putin hard.
We will not let up. We will continue to go further. I am grateful for the constructive and ongoing engagement with Parliament, including those I've mentioned on the issue of licensing, as well as for the strong, unified support for sanctions on Russia and the steadfast backing of Ukraine. Indeed, from the vast majority of the House, you will know, Sir Desmond, where I have issued criticism in the past of a. Of others who have parroted Kremlin lines and indeed um, have serious questions to ask on these matters.
So the government welcomes the shared determination of the Committee to maximise pressure on Putin's war machine, and recognises also the concerns and genuine scrutiny that have been raised. And I commend these regulations to the committee.
And I think those show again to the whole House and indeed the whole world, the appalling, barbarous actions that Russia is capable of and continues to do so. And I was able to convey that, um, that that horror and our solidarity and support to the chairman of the Rada this morning, Ruslan Stefanik, who was here as a guest of Mr. Speaker. And I know that he's been meeting other members and right honourable members across the House. Um, we all stand united with Ukraine. I know in this committee, and our thoughts are with all those affected by these terrible actions.
Um, Sir Desmond, this instrument was laid on the 19th of May, and the powers in the Sanctions and Anti-Money Laundering Act 2018, and the measures in the instrument subject to the made affirmative parliamentary procedure, entered into force on 20th of May. Um, Mr. Chair, since coming to power, the government has been clear that Russia must not be allowed to succeed in its illegal war, and we have been steadfast in our support of Ukraine. Russia represents not just a threat to Ukraine, of course, but a threat to the whole of Europe and indeed to the United Kingdom and our allies.
And as part of our response to Russia's illegal and barbarous war in Ukraine, the United Kingdom has sanctioned over 3300 individuals now and entities under the Russian sanctions regime, with over 1300 of those delivered under this government. And just last month, we introduced a new package that sanctioned 18 individuals and entities under the UK's Russia Sanctions regulations, including cryptocurrency exchanges active in Russia, entities and individuals that we suspect are linked to the UK sanctioned a seven network, which is embedded itself in the Kyrgyz financial sector, and this marks a further step in the UK sustained effort to erode Russia's ability to fund its illegal full scale invasion, ramping up pressure on Putin's war chest.
And this, of course, comes as yet another set of measures that we have taken repeatedly under this government. Indeed, continuing the work under the previous government, when I sat on the opposite side, welcoming and showing support for these measures, but also providing robust scrutiny, and these sanctions are having a real impact. Mr. chair, last month, Russia slashed its economic growth forecast for 2026 from 1.3% to just 0.4%, and Russia's deputy prime minister ascribed this downgrade to the impact of sanctions, among other factors. And indeed, Putin himself admitted that Russian GDP contracted by 1.8% in January and February, with a decline in areas that are critical to its war effort, including industrial production.
So it's clear that our sanctions are having an impact. It's clear that they are having bite, and that is why we will not see soon. I won't comment, obviously, on further measures, but we will not cease on exploring all opportunities to raise pressure to degrade Russia's war machine, um for its actions in Ukraine, and to look at all the methods in which they're using to evade those regimes. Um, Mr. Chair, to phase in the implementation of the measures before us today, we issued two targeted licences, which are intended, and I make very clear, as we did um, over many of the questions and debates we've had in this House are a temporary measure.
These licences are subject to ongoing review with fortnightly checkpoints and may be amended, suspended or revoked as appropriate. The first licence is for the new LNG maritime services ban and that temporarily authorised spot market trade from Russian LNG project Sakhalin two and Yamal until the 1st of January 2027, and the second licence applied to the refined oil import ban and authorised imports of diesel and jet fuel refined in third countries. As with the LNG licence, I must reiterate this to the committee. These licences are always intended as a temporary measure.
They are designed to be a measure to mitigate and protect consumers here and market stability, and they are subject to fortnightly reviews, and the process of review involves continually assessing the impact of licences on energy supplies, market conditions and other relevant considerations against our overarching impact, which is, I'm sure, shared by all members of this committee and our overall objective of ramping up pressure on Russia through our sanctions regime. And in light of this assessment, determining what steps are appropriate at each review point, there was, Mr. Chair, some misleading reporting and commentary around the time around these measures.
We were not watering down existing measures. These are new measures. These are measures that many across this House have called for, including myself. When I sat on the opposite side, um, toughening and tightening the pressure on Russia. But it is only appropriate, as often happens with sanctions regimes, that these are phased, that we allow appropriate market stability, and then at the earliest possible opportunity that the bans come in full as part of the review process that has been ongoing since these measures came into place, the government has now also set a clear end date for the refined oil licence of the 1st of January 2027, and that's in line with the liquefied natural gas maritime services band spot licence.
And that sets in the timetable now for fully phasing in the ban and shutting down this remaining route for Russian oil. Regular reviews will continue to ensure the licence is lifted at the earliest possible date, which of course could be before that date. And I will turn to the details in a moment. But I do want to thank the genuine and constructive scrutiny, particularly from Liberal Democrat counterparts and others, and conversations that have been had with members across this House to ensure that we come to the right, um, process of phasing in these measures and that the House that we've been able to communicate as the government on the basis of the review that we set out, how that is going to operate going forward.
And therefore, I hope that these measures will enjoy the wholehearted support of the Committee today, because indeed, as I set out, Mr. Chair, they include a range of different measures. Um, and it's important that all of those are able to go forward. The LNG and refined oil were just part of this overall package. Um the regulations are indeed a strong enhancement of our Russian sanctions regime, Mr. Chair, and to reiterate what the Prime Minister, indeed, my colleague the Minister for trade said on 20th of May, we have not lifted or sanctions.
Our sanctions are now stronger than they were a month ago. And I really do want to underline that point, um, to the committee the legislation is sanctioning previously unsanctioned goods and services, and that includes multiple measures targeting Russia's energy sector and indeed other key suppliers. So firstly, uh, Mr. Chair, we have imposed further export restrictions that fall into the following four categories. Firstly, items sanctioned by the EU already, including certain types of industrial chemicals, metals and machinery that have potential battlefield use goods recommended for sanctions by the government of Ukraine, including additional forms of metals and articles of carbon fibre, which are frequently used in the manufacture of those drones that we have seen causing such devastating impact.
And indeed, I witnessed myself where those drones had hit in Lviv just a few months ago, including again on a religious site in the city centre of Lviv. Absolutely appalling crimes. We need to be choking off the supplies and material that are being used for these drones. A more expansive list of individual chemicals and chemical precursors that might be used in, for example, riot control agents that have been found on the battlefield or goods for internal repression. And indeed, lastly, goods related to emerging technologies, including quantum semiconductor and engineering biology technologies, including new goods and those that are not already clearly subject to existing sanctions.
To reduce the risk of circumvention, as I said, it includes measures on refined oil. The legislation bans the import into the UK of oil products refined in third countries that have been made from Russian crude oil. Maritime services ban on LNG, which is a new maritime services ban and that restricts Russia's access to the UK's world leading maritime services, which again, is an issue that has been rightly raised on a number of occasions by colleagues across the House. Certain existing long term contracts are exempt from these provisions until the end of the year, and that is, I would point out, in line with the EU's LNG measure, we always attempt to work alongside our EU and other counterparts on this um for appropriate effect.
There is also a ban on the import of uranium. And this bans the import of uranium, which is consigned from Russia and uranium, which originates in Russia and restricts UK involvement in the global trade of Russian uranium. Exceptions are in place to mitigate risks to energy security in third countries, including to the supply of uranium to operational nuclear installations. Construction services is another area where this package takes action. Mr. chair, the legislation introduces a prohibition on providing construction services to persons connected with Russia, and that will complement the other restrictions we have in place on architecture and engineering, ensuring that UK construction businesses cannot support infrastructure and building projects which benefit Russia.
We've also introduced new criteria, expanded criteria for specifying ships, and members will have seen the very robust action, the brave action that our armed forces and law enforcement personnel took over the weekend. We will not hesitate to use measures to enforce international law and enforce action against those that Russia is attempting to use to circumvent, whether that's a vessel or another means to circumvent restrictions we are putting in place. And I pay tribute to all of those involved in that crucially important operation. But members will understand.
I won't go into further operational details today because of the nature of that, and I know questions have been raised on the on the floor as well of the main chamber. But in the new expanded criteria, we have specified ships to include ships carrying liquefied natural gas that originated in Russia and indeed, ships carrying coal and coal products that originated in Russia. And the aim of this is to make it easier to sanction ships for a wider range of activity. We've also strengthened the trade and shipping sanctions, which can be applied to specified ships by introducing additional prohibitions.
And the new trade sanctions enable the government to prohibit persons from providing and procuring certain maritime and financial services in relation to specified ships and indeed, additional shipping sanctions in this package prohibit persons from operating or chartering specified ships and require that the UK Shipping Register, who maintains the UK Ship Register, which is part of the Maritime and Coastguard Agency, refused to register specified ships. Lastly, Mr. Chair, the legislation will close a gap by prohibiting the acquisition and purported acquisition of a detained transport asset from or for the benefit of a designated for the benefit of a designated person or person connected with Russia.
And that instrument amends the enforcement provisions of the 2019 regulations, as well as the trade, aircraft and shipping Sanctions of Regulations 2024 to provide for the enforcement of the new prohibitions introduced by these regulations. So, Sir Desmond, to conclude, this is a wide ranging, impactful package which shows that the government takes incredibly seriously our commitment to supporting Ukraine and to targeting Russia for its actions in prosecuting its illegal and barbarous war in Ukraine, and to combat Putin's attempts to prolong this war and to do further damage and further death and destruction that he has been meting out, as we've seen so tragically, just in the last 24 hours, our sanctions have hit Putin hard.
We will not let up. We will continue to go further. I am grateful for the constructive and ongoing engagement with Parliament, including those I've mentioned on the issue of licensing, as well as for the strong, unified support for sanctions on Russia and the steadfast backing of Ukraine. Indeed, from the vast majority of the House, you will know, Sir Desmond, where I have issued criticism in the past of a. Of others who have parroted Kremlin lines and indeed um, have serious questions to ask on these matters.
So the government welcomes the shared determination of the Committee to maximise pressure on Putin's war machine, and recognises also the concerns and genuine scrutiny that have been raised. And I commend these regulations to the committee.
18:12
18:12
Speaker 4
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Speaker 4
Thank you very much. It is a pleasure to serve with you. In the chair, Sir Desmond, and as the minister, as already highlighted, um, the over the weekend, the barbaric attacks by Russia have added more significance to what we are discussing today. And we should also pay tribute to the extraordinary professionalism and courage of our Royal Marines, the Navy, the RAF and the National Crime Agency in successfully intercepting and boarding a vessel from Russia's shadow fleet in the English Channel. We commend all those involved in this landmark operation, but it also reinforces the point that these powers must be used decisively and consistently.
We hope this is not a one off, one off success, but the beginning of a sustained effort. Can the Minister confirm whether we should expect to see further such operations going forward?Russia relies on this shadow fleet to invade to evade international sanctions and bankroll its illegal war in Ukraine. So operations such as this strike directly at Putin's ability to fund his aggression, protecting the UK means standing firmly with our allies in Ukraine. Putin believed he could seize Ukraine in a matter of days, but the determination of the Ukrainian people proved him wrong.
We have a responsibility to do everything possible to limit Russia's ability to continue its aggression against a peaceful, democratic nation, Russia. Is the most pressing threat to European security. And we, of course, support measures that help constrain Russia's ability to prosecute its illegal invasion and its attempts to destabilise the West. However, as these benches have already put on record in the House, we regret that the government originally left a loophole for Russian oil that had been refined into diesel and jet fuel in other countries.
We understand that position changed over the weekend and that there will now be a ban on imports of diesel and jet fuel made from Russian oil by the 1st of January 2027. As we said, the decision last month to leave the loophole open should not have been necessary because Britain should be issuing UK oil and gas licences. This is not the time to be running down our own domestic fuel production, rather than relying on imports from countries that wish us harm, we should get drilling in the North Sea.
It will boost our energy security and bring down bills for households. As my right hon. Friend the shadow Foreign Secretary has argued, approving licences for Rosebank and Jackdaw North Sea fields would help the UK make greater use of its own resources. Instead, the government's opposition to further domestic production risks, leaving us dependent on energy supplies linked to hostile states. We don't believe that this is the right approach, chair, on the measures contained in the regulations, we welcome the ban on Russian uranium and the clarity it provides by prohibiting imports, whether they come directly from Russia or via third countries.
However, can the minister explain what steps the government is taking to expand domestic nuclear capability and strengthen long term energy resilience?In response to this, the ban on British companies shipping Russian liquefied natural gas is another welcome measure. By restricting the transportation of Russian LNG, it will reduce opportunities for third countries to trade in these products. We also welcome the extension of restrictions on construction services. What assurance can the minister provide that the exemptions within these regulations will be applied narrowly and not become a loophole?Returning to the provisions targeting the shadow fleet, these are particularly important because they move beyond banning goods and focus on the methods used to evade sanctions.
While these powers appear robust, the committee would benefit from greater clarity on how they will operate in practice. How many vessels does the government expect to have to designate?What evidential threshold will be required, given the use of opaque ownership structures and frequent reflagging of ships?How confident are ministers that these powers can keep pace with evolving tactics?While we welcome the early signs of success, how will the government assess whether these measures are delivering meaningful results in the long term?I look forward to the minister's response and to receiving reassurance that these measures will be effective in strengthening both our national security and the wider sanctions regime against Russia.
We hope this is not a one off, one off success, but the beginning of a sustained effort. Can the Minister confirm whether we should expect to see further such operations going forward?Russia relies on this shadow fleet to invade to evade international sanctions and bankroll its illegal war in Ukraine. So operations such as this strike directly at Putin's ability to fund his aggression, protecting the UK means standing firmly with our allies in Ukraine. Putin believed he could seize Ukraine in a matter of days, but the determination of the Ukrainian people proved him wrong.
We have a responsibility to do everything possible to limit Russia's ability to continue its aggression against a peaceful, democratic nation, Russia. Is the most pressing threat to European security. And we, of course, support measures that help constrain Russia's ability to prosecute its illegal invasion and its attempts to destabilise the West. However, as these benches have already put on record in the House, we regret that the government originally left a loophole for Russian oil that had been refined into diesel and jet fuel in other countries.
We understand that position changed over the weekend and that there will now be a ban on imports of diesel and jet fuel made from Russian oil by the 1st of January 2027. As we said, the decision last month to leave the loophole open should not have been necessary because Britain should be issuing UK oil and gas licences. This is not the time to be running down our own domestic fuel production, rather than relying on imports from countries that wish us harm, we should get drilling in the North Sea.
It will boost our energy security and bring down bills for households. As my right hon. Friend the shadow Foreign Secretary has argued, approving licences for Rosebank and Jackdaw North Sea fields would help the UK make greater use of its own resources. Instead, the government's opposition to further domestic production risks, leaving us dependent on energy supplies linked to hostile states. We don't believe that this is the right approach, chair, on the measures contained in the regulations, we welcome the ban on Russian uranium and the clarity it provides by prohibiting imports, whether they come directly from Russia or via third countries.
However, can the minister explain what steps the government is taking to expand domestic nuclear capability and strengthen long term energy resilience?In response to this, the ban on British companies shipping Russian liquefied natural gas is another welcome measure. By restricting the transportation of Russian LNG, it will reduce opportunities for third countries to trade in these products. We also welcome the extension of restrictions on construction services. What assurance can the minister provide that the exemptions within these regulations will be applied narrowly and not become a loophole?Returning to the provisions targeting the shadow fleet, these are particularly important because they move beyond banning goods and focus on the methods used to evade sanctions.
While these powers appear robust, the committee would benefit from greater clarity on how they will operate in practice. How many vessels does the government expect to have to designate?What evidential threshold will be required, given the use of opaque ownership structures and frequent reflagging of ships?How confident are ministers that these powers can keep pace with evolving tactics?While we welcome the early signs of success, how will the government assess whether these measures are delivering meaningful results in the long term?I look forward to the minister's response and to receiving reassurance that these measures will be effective in strengthening both our national security and the wider sanctions regime against Russia.
18:17
18:17
Speaker 5
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Speaker 5
Thank you sir. It's a pleasure to speak with you in the chair. Um, I welcome this piece of legislation and if we needed any further explanation of its need, the terrible events and attacks of the weekend which the Minister has already referred, provide us with that evidence. Allow me to add my party's admiration for the personnel involved in the first interdiction of a Shadow Fleet tanker over the weekend. Chair. This legislation is long awaited. I'm reliably informed by my noble friend, Lord Purvis, that he has called for the loophole on refined products paid for in third currencies, to be closed no less than eight times in the other place since March 2022.
I am glad that we finally have this legislation before us. I note that the license on these refined products was initially not time limited, and as the Minister has said, it has now been rendered. So I understand that the minister and his colleagues in the other place met with Lord Purvis and that Lord Purvis wrote to the minister seeking a firm end date. So can I ask the minister three things?Would he kindly deposit that correspondence of letters in the Commons library to make clear the constructive exchange that took place?Will he confirm that the licence will end no later than the 1st of January 2027?And will he also confirm that licence remains under review and could be suspended prior to that date?I also understand that the business is now operating under the LNG and refined products licences have to notify the government that they are operating under that licence.
Can the minister state whether notifications have been made since the entry into force of the of the regime, or, if not, will he agree to let us know in writing and commit to a monthly update on the notifications made for so long as the licences remain in place?Chair, we must continue to isolate Russia like the rogue state that it is. That means taking robust action to ensure that sanctions are not sidestepped. Since the illegal invasion of Ukraine, it has been necessary and appropriate to implement a wide range of sanctions against both individuals and companies.
Liberal Democrats want to put a stop to oligarchs from corrupt regimes, channelling their money through the UK by beginning the seizure of frozen Russian assets in the UK, with proceeds being repurposed to finance support for Ukraine so that we can stand with Ukraine even if US support wavers through the delivery for action. On releasing the proceeds of the sale of Chelsea Football Club for the benefit of Ukrainian civilians through properly resourcing the National Crime Agency, and by closing the loopholes in economic crime legislation which allow Putin's cronies and other kleptocrats to continue funnelling dirty cash into our country.
Liberal Democrats are also calling for a complete prohibition on UK companies providing maritime services like insurance for Russia's export of fossil fuels. The scandal of UK plc, helping to facilitate profits for Putins war machine must end. So, chair, may I end by asking the Minister whether he can confirm that the government will keep all sanctions on oil, gas products and on professional, maritime and banking services under review and bring forward further packages that choke off Russia's revenue streams.
I am glad that we finally have this legislation before us. I note that the license on these refined products was initially not time limited, and as the Minister has said, it has now been rendered. So I understand that the minister and his colleagues in the other place met with Lord Purvis and that Lord Purvis wrote to the minister seeking a firm end date. So can I ask the minister three things?Would he kindly deposit that correspondence of letters in the Commons library to make clear the constructive exchange that took place?Will he confirm that the licence will end no later than the 1st of January 2027?And will he also confirm that licence remains under review and could be suspended prior to that date?I also understand that the business is now operating under the LNG and refined products licences have to notify the government that they are operating under that licence.
Can the minister state whether notifications have been made since the entry into force of the of the regime, or, if not, will he agree to let us know in writing and commit to a monthly update on the notifications made for so long as the licences remain in place?Chair, we must continue to isolate Russia like the rogue state that it is. That means taking robust action to ensure that sanctions are not sidestepped. Since the illegal invasion of Ukraine, it has been necessary and appropriate to implement a wide range of sanctions against both individuals and companies.
Liberal Democrats want to put a stop to oligarchs from corrupt regimes, channelling their money through the UK by beginning the seizure of frozen Russian assets in the UK, with proceeds being repurposed to finance support for Ukraine so that we can stand with Ukraine even if US support wavers through the delivery for action. On releasing the proceeds of the sale of Chelsea Football Club for the benefit of Ukrainian civilians through properly resourcing the National Crime Agency, and by closing the loopholes in economic crime legislation which allow Putin's cronies and other kleptocrats to continue funnelling dirty cash into our country.
Liberal Democrats are also calling for a complete prohibition on UK companies providing maritime services like insurance for Russia's export of fossil fuels. The scandal of UK plc, helping to facilitate profits for Putins war machine must end. So, chair, may I end by asking the Minister whether he can confirm that the government will keep all sanctions on oil, gas products and on professional, maritime and banking services under review and bring forward further packages that choke off Russia's revenue streams.
18:20
Speaker 6
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Speaker 6
Thank you, Mr. Desmond. I certainly welcome any strengthening of sanctions against Russia and indeed any other aggressor. But there is one point upon which I would I wish to seek clarification, and it is rooted in what it says in paragraph four. Four of the explanatory memorandum, where it says, as one would expect, this. This instrument extends to the whole of the United Kingdom. But then it says this. It is subject to any obligation arising in respect of the Windsor framework, in respect of Northern Ireland.
So it is conditional to the supremacy of any overriding imposition under the Windsor framework. I want to know what possible provision of the Windsor framework could leave Northern Ireland less impacted, as it ought not to be by these requirements in respect of sanctions. Why does it say that in four for. Short. What is it that's in the Windsor framework that can impede UK sovereignty on this matter?Because foreign policy, above all, has to be an exclusively integral UK matter.
And yet, if we have a situation where we're bringing forward regulations, which the explanatory memorandum is saying they are for the whole United Kingdom, subject to the Windsor framework. That is not acceptable because my constituents want to be as fulsome a part of the sanctions against Russia as anyone else. So I do urge the minister to explain to the to us what is lies behind paragraph four four. And if there is some exemption or some imposition within the Windsor framework, then let's spell it out and let's see what it is, because it would be intolerable if a UK.
What should be a UK wide imposition is tempered or weakened or undermined by something that the EU requires under the Windsor framework?So could we have that clarification?
So it is conditional to the supremacy of any overriding imposition under the Windsor framework. I want to know what possible provision of the Windsor framework could leave Northern Ireland less impacted, as it ought not to be by these requirements in respect of sanctions. Why does it say that in four for. Short. What is it that's in the Windsor framework that can impede UK sovereignty on this matter?Because foreign policy, above all, has to be an exclusively integral UK matter.
And yet, if we have a situation where we're bringing forward regulations, which the explanatory memorandum is saying they are for the whole United Kingdom, subject to the Windsor framework. That is not acceptable because my constituents want to be as fulsome a part of the sanctions against Russia as anyone else. So I do urge the minister to explain to the to us what is lies behind paragraph four four. And if there is some exemption or some imposition within the Windsor framework, then let's spell it out and let's see what it is, because it would be intolerable if a UK.
What should be a UK wide imposition is tempered or weakened or undermined by something that the EU requires under the Windsor framework?So could we have that clarification?
18:22
Speaker 3
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Speaker 3
Well, thank you, Sir Desmond. I genuinely appreciate the the scrutiny and the questions raised by honourable members and the opposition spokesperson. I appreciate the the wholehearted support for the package as a whole. Um, the question he asked me about further operations and you'll understand. I'm not going to get into that. Um, on, on the floor of the house. But, you know, let's, let's be clear. I think we've sent a very, very strong signal by the action of the weekend.
The Prime Minister's been absolutely clear about the intent. And we will act lawfully, um, to take measures in relation to the shadow fleet. And um I think what we've seen is very clear signal. Of course, it's not the first time that we've been involved in operations. Of course, we've supported other partners and allies on a range of vessels operating out with um international law in relation to sanctions evasion. So um, but this was the first where we were in the lead and took action, uh, in.
The, in the channel. Um, I just gently caution him on, on his question about loopholes. Um, there was not a loophole. There was a loophole prior to the bringing in of this legislation. That's why we've been seeking to do it. Um, and it's something that I'd called on for a very long time. I know many members had indeed. And, uh, the spokesperson for the Liberal Democrats rightly pointed out his noble, noble friend's assiduous advocacy on this over many, many years.
This is a situation which did allow these products before. It will not allow them now, but it only right that those are phased in in an appropriate way. And we set out clearly how we intend to do that. Um, he raises the point about wider energy supplies and and goes back to the arguments being used on the floor of the House a few times about the North Sea. But look, you know, my colleague the Energy Secretary has been very, very clear.
Um, expanding drilling in the North Sea will not lower bills or improve energy security. Um, it's a short sighted approach actually leaves the UK exposed to volatile global gas prices because of course, gas prices are set internationally. And so new North Sea licences wouldn't take a penny off bills. And they'd actually make people potentially more vulnerable. So we're looking at better use of existing North Sea infrastructure and what are known as tie backs. And there are a range of measures that we're taking in that regard.
So we'll always act in the right interests of British consumers, but also in relation to the challenges of climate change, but equally making sure that we have security of supply. This is not just one policy in of itself. It's it's within a range of different measures. And he rightly points out, however, the importance of investment in nuclear. And of course, that is exactly what this government is doing, including, I'm pleased to say, in my own party of the United Kingdom in Wales, the new announcements made recently.
And of course, we can see the investment that's going into the Hinkley plant opposite. Indeed, my own constituency, Sir Desmond, and the huge benefits that will bring. And so we're very, very clear that investment in nuclear, in renewables, in energy system, which is robust and resilient and doesn't rely on the likes of of Putin or anybody else in the future, is the way forward. And of course, we work with partners in that regard, too. And he asked about the other exemptions that are in here, that those are narrowly construed.
I'm very happy to write back to him with some more technical detail on all of those, but absolutely, I can assure him, in general terms, we aim to make sure that there are there are no unreasonable ways in which any of these matters can be. Uh, circumvented. And he asks about the the Shadow fleet. Of course, we intend to make further measures in this place. We've had a steady drumbeat of, of, of designations and actions. We have to ensure each of those is evidenced, um, is based on clear legal parameters.
But I can absolutely assure him that we are very, very closely across the, the practice of false false flagging and reflagging of vessels, which actually is one of the tactics that that Russia and indeed other countries have been using to avoid scrutiny. So I can absolutely assure him on, on that front. And the honourable gentleman, the Liberal Democrats raised some some some important points. He asked if I'll deposit the the letters and correspondence, my understanding those were those were private, but I'll certainly look, if I can do that.
Um, because essentially what I set out there is the measures that we have announced now, uh, publicly, I can confirm to him that the date that I set out and that I set out to his colleague, I can confirm that they will remain under constant review. And of course, if there is an earlier possible opportunity, we should seek to to take that subject to the provision of the four month notification, which we set out in the original licence, and he asks about whether notifications have been made on whether anybody's been using the existing licence.
I can tell them that some notifications have been made, but I can tell him that, um, the numbers are extremely low. Um, and that's obviously one of the factors that we took into consideration as we were seeing how this licence was operating. I can't comment, he'll understand on individual specific companies and I don't think it would be right to, to do that. There may be confidentiality or commercial provisions around that. I certainly can assure him that we constantly look and we'll keep under constant review any UK nexus or indeed any other ways in which services are being used.
And of course, we do this very, very closely working with other partners. I've been meeting with EU official colleagues today, um, along with our teams from the foreign, Commonwealth and Development Office to establish where again, we can unify efforts to have the maximum impact because although we can have a huge impact as the United Kingdom. Sir Desmond, it's also important that we're acting with others, that we have the the biggest hit on Putin's war chest and on the relation to the EU. The honourable gentleman asks about the Windsor framework.
I'm very happy to write to him on the technicalities. I don't want to mislead him at this stage. I'm assuming this is a standard language, because, of course, all the sanctions regulations come in as a result of us leaving the EU sanctions regulations as part of Brexit, and we have obviously wider obligations. So I suspect this is a standard paragraph. I can't think of any specific obligations to hand, but I will certainly write to him with the technical detail because we.
I will in a moment, but I want to assure him that our aim is. Of course, the sanctions have the biggest impact, that there aren't loopholes. There are ways around. Anybody can get around them in any part of the United Kingdom or indeed actually in our overseas territories. And indeed the Crown dependencies. And I work very closely with the overseas territories and indeed the Crown dependencies on ensuring their sanctions legislation is fit for purpose. We have strong working between the different teams to ensure that we understand, a what we need to put in place legally, but also that enforcement takes place because that's the crucial thing.
Um, and I know having visited the ports in my own constituency in Cardiff South and Penarth, the work that goes on in checking vessels to make sure they're not appearing on lists, um. Of sanctioned vessels. And I'm sure that is the case for, for ports in Northern Ireland as well. Um and indeed I'm sure across other EU partners I'll happily give way.
The Prime Minister's been absolutely clear about the intent. And we will act lawfully, um, to take measures in relation to the shadow fleet. And um I think what we've seen is very clear signal. Of course, it's not the first time that we've been involved in operations. Of course, we've supported other partners and allies on a range of vessels operating out with um international law in relation to sanctions evasion. So um, but this was the first where we were in the lead and took action, uh, in.
The, in the channel. Um, I just gently caution him on, on his question about loopholes. Um, there was not a loophole. There was a loophole prior to the bringing in of this legislation. That's why we've been seeking to do it. Um, and it's something that I'd called on for a very long time. I know many members had indeed. And, uh, the spokesperson for the Liberal Democrats rightly pointed out his noble, noble friend's assiduous advocacy on this over many, many years.
This is a situation which did allow these products before. It will not allow them now, but it only right that those are phased in in an appropriate way. And we set out clearly how we intend to do that. Um, he raises the point about wider energy supplies and and goes back to the arguments being used on the floor of the House a few times about the North Sea. But look, you know, my colleague the Energy Secretary has been very, very clear.
Um, expanding drilling in the North Sea will not lower bills or improve energy security. Um, it's a short sighted approach actually leaves the UK exposed to volatile global gas prices because of course, gas prices are set internationally. And so new North Sea licences wouldn't take a penny off bills. And they'd actually make people potentially more vulnerable. So we're looking at better use of existing North Sea infrastructure and what are known as tie backs. And there are a range of measures that we're taking in that regard.
So we'll always act in the right interests of British consumers, but also in relation to the challenges of climate change, but equally making sure that we have security of supply. This is not just one policy in of itself. It's it's within a range of different measures. And he rightly points out, however, the importance of investment in nuclear. And of course, that is exactly what this government is doing, including, I'm pleased to say, in my own party of the United Kingdom in Wales, the new announcements made recently.
And of course, we can see the investment that's going into the Hinkley plant opposite. Indeed, my own constituency, Sir Desmond, and the huge benefits that will bring. And so we're very, very clear that investment in nuclear, in renewables, in energy system, which is robust and resilient and doesn't rely on the likes of of Putin or anybody else in the future, is the way forward. And of course, we work with partners in that regard, too. And he asked about the other exemptions that are in here, that those are narrowly construed.
I'm very happy to write back to him with some more technical detail on all of those, but absolutely, I can assure him, in general terms, we aim to make sure that there are there are no unreasonable ways in which any of these matters can be. Uh, circumvented. And he asks about the the Shadow fleet. Of course, we intend to make further measures in this place. We've had a steady drumbeat of, of, of designations and actions. We have to ensure each of those is evidenced, um, is based on clear legal parameters.
But I can absolutely assure him that we are very, very closely across the, the practice of false false flagging and reflagging of vessels, which actually is one of the tactics that that Russia and indeed other countries have been using to avoid scrutiny. So I can absolutely assure him on, on that front. And the honourable gentleman, the Liberal Democrats raised some some some important points. He asked if I'll deposit the the letters and correspondence, my understanding those were those were private, but I'll certainly look, if I can do that.
Um, because essentially what I set out there is the measures that we have announced now, uh, publicly, I can confirm to him that the date that I set out and that I set out to his colleague, I can confirm that they will remain under constant review. And of course, if there is an earlier possible opportunity, we should seek to to take that subject to the provision of the four month notification, which we set out in the original licence, and he asks about whether notifications have been made on whether anybody's been using the existing licence.
I can tell them that some notifications have been made, but I can tell him that, um, the numbers are extremely low. Um, and that's obviously one of the factors that we took into consideration as we were seeing how this licence was operating. I can't comment, he'll understand on individual specific companies and I don't think it would be right to, to do that. There may be confidentiality or commercial provisions around that. I certainly can assure him that we constantly look and we'll keep under constant review any UK nexus or indeed any other ways in which services are being used.
And of course, we do this very, very closely working with other partners. I've been meeting with EU official colleagues today, um, along with our teams from the foreign, Commonwealth and Development Office to establish where again, we can unify efforts to have the maximum impact because although we can have a huge impact as the United Kingdom. Sir Desmond, it's also important that we're acting with others, that we have the the biggest hit on Putin's war chest and on the relation to the EU. The honourable gentleman asks about the Windsor framework.
I'm very happy to write to him on the technicalities. I don't want to mislead him at this stage. I'm assuming this is a standard language, because, of course, all the sanctions regulations come in as a result of us leaving the EU sanctions regulations as part of Brexit, and we have obviously wider obligations. So I suspect this is a standard paragraph. I can't think of any specific obligations to hand, but I will certainly write to him with the technical detail because we.
I will in a moment, but I want to assure him that our aim is. Of course, the sanctions have the biggest impact, that there aren't loopholes. There are ways around. Anybody can get around them in any part of the United Kingdom or indeed actually in our overseas territories. And indeed the Crown dependencies. And I work very closely with the overseas territories and indeed the Crown dependencies on ensuring their sanctions legislation is fit for purpose. We have strong working between the different teams to ensure that we understand, a what we need to put in place legally, but also that enforcement takes place because that's the crucial thing.
Um, and I know having visited the ports in my own constituency in Cardiff South and Penarth, the work that goes on in checking vessels to make sure they're not appearing on lists, um. Of sanctioned vessels. And I'm sure that is the case for, for ports in Northern Ireland as well. Um and indeed I'm sure across other EU partners I'll happily give way.
18:30
18:30
Speaker 4
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Speaker 4
You very much. The Minister for giving way. I'd be grateful that I didn't I didn't intervene on the North Sea oil and gas argument earlier. I think we've had that many times, and we'll leave that be on this point. Could I ask the minister to also copy myself into the correspondence regarding this?And the minister did touch on it. There's a particular concern, not just around the actual regulations themselves, but ways in which, um, Russia could potentially use any deviation in the way that it gets around the actual enforcement of those regulations as well.
And I'd just be very keen to see that it is just a generic wording rather than any specific concern or incident.
And I'd just be very keen to see that it is just a generic wording rather than any specific concern or incident.
18:31
Speaker 3
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Speaker 3
Of course. And as I said, I don't want to mislead the House, Sir Desmond, with, um, if there is something more technical in relation to this, and I'll happily copy him in as well. But what I can assure him is one of the things that we do very closely with our EU partners, including the Republic of Ireland, is establishing whether there are any routes around these things that can be used by anybody. And, of course, we cooperate very closely with their authorities more generally, including in relation to the security of the waters around, um, our islands, because that is crucial.
And obviously we see Russian ships and others attempting to transit and do so. And obviously we need to ensure that's being done lawfully. There are, of course, innocent rights of passage in international maritime law that colleagues will be aware of. But where that is not adhered to, um, we need to make sure that we look for any possible loophole. But with that, Sir Desmond, I hope that the committee will support these regulations. They're an important step forward, and I commend them to the House.
And obviously we see Russian ships and others attempting to transit and do so. And obviously we need to ensure that's being done lawfully. There are, of course, innocent rights of passage in international maritime law that colleagues will be aware of. But where that is not adhered to, um, we need to make sure that we look for any possible loophole. But with that, Sir Desmond, I hope that the committee will support these regulations. They're an important step forward, and I commend them to the House.