Sanctions and Anti-Money Laundering Bill [Lords]

Jim Shannon Excerpts

2nd reading: House of Commons
Tuesday 20th February 2018 Commons Chamber

[Alison Thewliss (Glasgow Central) (SNP)]

This is another Bill that has been caused by Brexit. EU co-operation has been crucial to sanctions and anti-money laundering, and we have moved quite far along the road together as friends, neighbours and colleagues. A lot of concerns about the Bill have been voiced in relation to the justification of proportionality, and whether it takes us in the right direction to give us the opportunity to correct the flaws in our own systems.

Sanctions, as other hon. Members has said, are effective when we have co-operation, particularly as an EU block. That reflects the limitations of sanctions from the UN Security Council, because there is not always agreement among its permanent members. We need to find our place. Our place is not in the EU, as it was, but it is not entirely as other states are in the world. We need to find out where we are. Tom Keatinge from the Royal United Services Institute has said that we may have greater flexibility, but we will certainly have less influence. Ministers need to be reminded of that. I see that the Foreign Secretary has scuttled off without hearing me, which is kind of him. Without the active co-operation and engagement of Ministers with the EU, we will not be able to be the most effective at imposing sanctions. We should not pour our own collective efforts over the years down the stank just because we are leaving the EU. Unilateral sanctions bring with them a recognised risk that while we might want to do the right thing there may be repercussions. Being a part of EU collective action cushions us to an extent from that risk. We do not want to be marginalised in the world. We must take care to make sure that does not happen.

[Jim Shannon (Strangford) (DUP)]

The hon. Lady makes a valid point, although I have a different opinion on Brexit. Does she not agree that our ability to implement sanctions and address money laundering are essential components of our exit from Europe and that it is vital we have the same protections in place in the international market? We must look at the possibility of even enhancing them and making them even stronger.

[Alison Thewliss]

I agree that we perhaps can and should enhance what we do, but we must take care not to lose what we have so far. We must not lose that co-operation and sense of common purpose against evils in the world, which we have had as a part of the EU.

I support the points on human rights made by the hon. Member for Bishop Auckland (Helen Goodman). Ministers did not quite recognise the point that paragraphs (e), (f), (g) and (h) in clause 1(2) are in the Bill because they were put there by a Labour Lord. She may have made that point, but I did not want to let it pass without having recognised it. The Government should not be taking credit for things they did not do and did not put in the Bill. Those paragraphs should be in the Bill. Anything that can enhance the importance of human rights in the Bill should be there.

The NGO sanctions and counter-terrorism working group, chaired by Bond and the Charity Finance Group, has asked for protection in law for humanitarian and peace-building work, as that is, to a degree, currently inhibited by the EU regulatory framework on sanctions. As the right hon. Member for Sutton Coldfield (Mr Mitchell) set out, aid operations in parts of the world that are extremely dangerous and under sanctions from the UN and the EU still have to have aid workers. They have to build up relationships on the ground. They may not be comfortable with them and they may be difficult, but aid would not happen without them.

Currently, there is not sufficient protection in the Bill. There is reference to general licences with a bit more focus on guidance. Clause 37(1) states that the Minister who makes the regulations must issue guidance, but clause 37(2) states only that guidance “may” include guidance about compliance enforcement and disregards. That is not concrete enough. The guidance should be more certain, so that people know the regime they are working under, know the risks involved in what they are about to do and know if there will be any comeback from the actions they take. I do not think that that is clear enough, and I would like to see improvements in this area of the Bill. More concrete assurances are required.

That concern is shared by the banks. The UK Finance briefing on the Bill says that there is a fear of misuse, but there has to be a way to get around that. It provides the example of banks avoiding any transactions whatever with Iran, due to the risk of being sanctioned by the US—its sanctions regime is far-reaching. That risk alone has a chilling effect on its transactions in that area, regardless of any actual certainty. Sanctions will have an impact on such countries for many years to come, even after sanctions have ended. Banks need to have the confidence that they can deal with a country consistently over a number of years without falling foul of sanctions that suddenly reappear. The people working in such countries need to interact with donors, banks and transport and logistics companies. They need comfort on that. They need to buy fuel. They need to buy mobile phones. They need to make payments to move about the country and to let aid flow. For example, it is not possible to move around Yemen because there are different forces imposing different visa regimes. Moving around the country may involve making payments that fall foul of sanctions.