Russia (Sanctions) (EU Exit) (Amendment) Regulations 2022

Debate between Lord Balfe and Lord Browne of Ladyton

Thursday 24th February 2022 Lords Chamber

[Lord Browne of Ladyton (Lab)]

My Lords, I rise to ask one very specific question about the impact of sanctions, but before I do that, I would like to associate myself with the earlier remarks commending the Minister on his introductory description of where we are and why we should roundly condemn Russia’s actions. He got the tone of that exactly right, and we need to continue with that.

I am conscious that, later today, we will take the Statement from the Prime Minister and have an opportunity to debate that, and we will have a long debate tomorrow. I therefore intend to restrict myself to sanctions, although I share all the ambitions of previous speakers that we will be able to extend our influence on a legal basis against the interests of people who are supporting this dreadful and inexcusable criminal behaviour that is taking place as we speak.

Here is my question. These sanctions need to be meaningful. I carefully read the debate on them in the other place, and I have read the letter that the Minister sent to us all thereafter, which deals with a number of the technical and legal points that were raised in that debate, some of which have been repeated here today. I am clear that nowhere in that debate did the Minister say at any point what the three persons mentioned in the sanctions on Tuesday—Gennady Timchenko, Boris Rotenberg and Igor Rotenberg—are not able to do today that they were able to do on Monday; nor did anybody say what impact these sanctions would have on any of those relatively small banks. They may be very important, but what are those banks not able to do today that is within our jurisdiction that they were able to do on Monday?

I raised this issue with the Leader of the House when that Statement came on Tuesday to your Lordships’ House. I said specifically that I recognised that this was a framework for the sanctions to be made, but the implementation of them depended on a suite of legislation, not only for their existence but for their actual use properly for the purpose for which they were designed. She gave me a very comprehensive answer, but the answer was all, “We have plans to”, “We intend to”, “We are working on”, “We are looking at”. I am not quoting her exactly, but it was all prospective.

We need to put into position a suite of powers that will then allow us to do what we need to do, so as we debate these sanctions, we should not kid ourselves that we are having an impact on Putin or any of his acolytes today, but we may have in the future. Interestingly, today, before the Prime Minister makes the Statement to the House of Commons, it is being reported that he is promising massive sanctions designed—and this is the interesting phrase—“in time” to hobble the Russian economy. Why do we not already have the ability to change the way in which Companies House practises and its ability to pour out shell companies that people can use to hide their assets? Why do we not have anti-money laundering legislation that is used in an impactful way to prevent the sort of stuff that is going on? Why do we not already recognise that we have people in the City of London who make a significant living out of facilitating all of that sort of behaviour, and they do it openly, with nameplates on the door that tell people that that is what they are doing?

It is important that the Government recognise that what we are doing here is legislating for potential, but it is not potential that will be impactful, although it may, for a couple of days, affect the sentiments of the stock exchange.

[Lord Balfe (Con)]

My Lords, a few days ago, I was in the House of Commons at a meeting of the All-Party Parliament Group on Russia at which the ambassador said quite clearly that Russia had no plans to invade. That can lead to only two conclusions: his Government do not tell him what they are doing or he was not telling us the truth. There can be no other conclusion in the middle.

I am very sorry that we are where we are today because, as the noble Lord, Lord Foulkes, will know, I worked pretty ceaselessly in the Council of Europe to try to get the Russians back on side. I worked in the legal affairs committee with them and said to them “Look, if you want to be in the Council of Europe, you’re very welcome, but basically you have to underline and support what we are trying to do”. In a very short temporary period as chair of legal affairs, I was instrumental in getting a couple of rapporteurships allocated to the Russian delegation. I spoke to it about the need to reflect the values of the council in producing the report. In other words, being a rapporteur was not a licence to print Russian propaganda but an opportunity for members of the Russian delegation to show that they were prepared to produce reports reflecting the views of the council in a legal and human rights situation.

What has happened overnight is absolutely dreadful—there is no other word for it—because it destroys many months of work that has taken place, particularly outside the United Kingdom. Members may have noticed that on numerous occasions I have urged the British Government to work with their French and German counterparts because I thought that the French and German foreign ministries were trying very hard to lead Russia to a place where it would settle its disputes with Ukraine through the Minsk process, negotiation and talk.

I am sure that it is recognised today in Berlin and Paris that that has failed. At the beginning of this week, I had lunch in this House with some German politicians who were hopeful of it working. They pointed out to me that Nord Stream 2 had been put on hold, not cancelled, and it could be revived. We talked about it, and one of the points that was made was that, of course, it goes two ways: it can bring gas from Russia and, once it is in the European gas network, it can pump it back. Indeed, some of my German interlocutors said that one of the guarantees that they could give would be that, if Russia threatened Ukraine’s gas supplies, Germany could supply it with gas. I mention that because it shows that, right up to the last minutes, the foreign ministries in Europe were trying to find a peaceful solution.

However, we now have to be firm because, as the peaceful solution has not worked, it cannot be said that no consequences flow from what has happened. So, clearly, we not only have to have sanctions, but if we are going to have sanctions that work, they have to be agreed among the larger players in Europe. That, frankly, means that we have to do what has been suggested about the overseas territories and we also have to stand up and be quite firm with Hungary and Austria because countries that are making large profits out of Russia have to realise that they are either in a European solidarity pact or on the other side. They cannot be on both sides at once.