Russia (Sanctions) (EU Exit) (Amendment) (No. 11) Regulations 2022

Lord Ahmad of Wimbledon Excerpts

Wednesday 12th October 2022 Lords Chamber

Moved by

[Lord Ahmad of Wimbledon]

That the Regulations laid before the House on 14 July be approved.

[The Minister of State, Foreign, Commonwealth and Development Office (Lord Ahmad of Wimbledon) (Con)]

My Lords, I beg to move that the House considers the Russia (Sanctions) (EU Exit) (Amendment) (No. 11) Regulations 2022, and will also speak to the Russia (Sanctions) (EU Exit) (Amendment) (No. 12) Regulations 2022, the Russia (Sanctions) (EU Exit) (Amendment) (No. 13) Regulations 2022, and the Russia (Sanctions) (EU Exit) (Amendment) (No. 14) Regulations 2022.

The instruments before us were laid between 14 and 20 July, under powers provided by the Sanctions and Anti-Money Laundering Act 2018, and make amendments to the Russia (Sanctions) (EU Exit) Regulations 2019. In co-ordination with our allies, the United Kingdom continues to introduce the largest and most severe economic sanctions package that Russia has ever faced. Noble Lords will note that we continue to bring further pressure to bear on Mr Putin and his regime. Since these SIs were introduced, we have made further announcements on UK sanctions in response to Mr Putin’s illegal annexation of Ukrainian regions.

On 26 September, the UK sanctioned 29 individuals and organisations related to the temporarily controlled territories of Donetsk, Luhansk and Zaporizhzhia, Russian Government officials, four additional oligarchs and 55 state board executives. On 30 September, the Foreign Secretary announced a new set of sanctions related to services on which Russia depends. Building on previous action, the UK will prevent Russian access to advertising services, architectural services, auditing services, engineering services, IT consultancy and transactional legal advisory services linked to certain commercial activity.

The announcement also included a new ban on the export of nearly 700 goods that are crucial to Russia’s industrial and technological capabilities. The UK also sanctioned Elvira Nabiullina, the governor of the Central Bank of the Russian Federation. Nabiullina has been instrumental in the Russian economy throughout the Russian regime’s illegal war against Ukraine and in extending the rouble into the Ukrainian territories that are temporarily controlled by Russia. The measures we are debating today further isolate Russia’s economy and target key industries supporting Mr Putin’s illegal war in Ukraine.

I will first cover the No. 11 regulations, which ban the export of goods and technologies related to the defence, security and maritime sectors. They also prohibit the export of jet fuel, maritime goods and technology, certain energy-related goods, plus sterling and European Union banknotes. In addition, these regulations ban the import of goods such as fertiliser, metals, chemicals and wood, depriving Russia of a key export market. Together, these were worth £585 million last year. A further import ban covers ancillary services related to iron and steel imports.

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I will not go on much further; I echo the comments on some of the details of these sanctions. The thrust of our contribution tonight is that it is good that we have and are adapting the sanctions—but let us make sure that we are vigilant in enforcing them in the best way possible.

[Lord Ahmad of Wimbledon (Con)]

My Lords, I thank all three noble Lords for their contributions this evening. I say from the outset to the noble Lords, Lord Purvis and Lord Collins—both will appreciate this, as we are working at speed—on the effectiveness of comparisons with our international partners, that there is information readily available, but there is a sensitivity, if I may put it that way, in publicly sharing information. However, I will be happy to share certain information and briefings with both noble Lords and give them updates on where we are.

Both noble Lords raised the important issue of the effectiveness of co-ordination with our partners, and I know that this is of interest. While I mentioned the issue of energy vis-à-vis our European Union partners, I have always maintained that there will inevitably be a country leading—such as the US or ourselves, or the EU—in certain areas. The important element with respect to the granular detail—I do have the summaries available, which I reflect on quite regularly—is to ensure that where there is a gap, say, from our side, we ask the pointed question as to why that is the case so that we can address it, and vice versa. Actually, that is working very well. I can share some of that information and bring noble Lords up to date on that, specifically outside the Chamber.

[Lord Purvis of Tweed (LD)]

I cannot speak for the noble Lord, Lord Collins, but I say on behalf of my noble friends Lady Kramer and Lord Fox, who take an interest in these issues, that if the Minister wanted to facilitate a private briefing with officials to give an update on the Government’s estimate of the impact on the Russian economy, we would be willing to take that. I wanted to make sure that was on the record.

[Lord Ahmad of Wimbledon (Con)]

I can certainly share some of these issues, on the wider and general impact, this evening. However, particularly as we are working in very close alignment with our partners, I shall be certain to provide updates and private briefings in that respect.

I again thank all noble Lords for their strong support. The noble Viscount, Lord Stansgate, raised a question on the reach of SI 11. I confirm to him that we are co-ordinating the lists of goods covered by our export prohibitions with our G7 allies, and we are working very closely on those lists. To summarise, SI 11 covers an export ban on defence and security goods and technology, including products for internal repression; an export ban on maritime goods and technology; an export ban on additional energy-related goods and oil refining; an export ban on sterling or EU-denominated bank notes; an export ban on jet fuel and fuel additives; an import ban on revenue-generating goods, including metals, wood and chemicals, among others; and a ban on technical assistance, financial services and funds. So the SI is pretty comprehensive.

[Lord Collins of Highbury (Lab)]

On that specific point, Stephen Doughty asked at the other end about goods for internal repression and how we are introducing that ban now, when surely we should have adopted it much earlier, particularly with the invasion of Crimea. Have we been exporting equipment for internal repression before?

[Lord Ahmad of Wimbledon (Con)]

As I said in my opening remarks, there are areas where SIs are already present and there may be a degree of overlap in the application, but what we are seeking to do with all these SIs is to ensure that our regulations are fully comprehensive. It is not that we were in the market to suddenly start exporting items which add to the suppression of domestic populations—I think we have known for a long time the challenges that the people of Russia face. As we evolve, go forward and progress our sanctions, it is important that we are as detailed as we can be. Previous sanctions may have covered aspects of those limitations, but we want to make sure that we are covering every element that we can.

Both noble Lords highlighted how those who are having sanctions imposed on them are looking at innovative pathways to overcome them. We have to be dynamic in responding to that. The noble Lord, Lord Purvis, raised the issue of other partners beyond our key G7 partners, and that is important. I fully accept that there will be issues; different countries have different perspectives, as we can see from looking at votes taking place within multilateral fora, including the one on the sham referenda. It is noticeable—I am being very up front here—that some countries are now not as forward-leaning as they were previously, and it is important that they get a consistent and consolidated sense from both your Lordships’ House and the other place of unity and purpose. Of course questions are there, but I cannot emphasise how important it is for them to see this unanimity. There are partners who are looking at this as the war continues with regard to their own domestic challenges as well. Therefore, the more aligned we can be with those partners who have sanctions regimes, the more effective we will be. However, I fully accept that there will be ways and means in which those having sanctions imposed on them will look to circumvent them.

The noble Lord, Lord Collins, asked about the McFaul group. The working group is an independent group of sanctions experts. Government officials have regular contact and close exchanges with the group, but if there are specific points perhaps the noble Lord will raise them with me and I will seek to answer them more specifically.

The noble Lord, Lord Purvis, talked about circumvention, which I have already addressed in part. These regulations seek to close the gaps. I come back to the whole issue of how we work with key partners. I will seek to provide more detail on the specific examples that the noble Lord raised.