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The public policy of sanctions compliance: A need for collective and coordinated international action

Published online by Cambridge University Press:  27 January 2022

Justine Walker
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Abstract

This paper sets out to explain the challenges of aligning sanctions compliance efforts with the delivery of humanitarian aid into highly sanctioned environments. It highlights that while the policy of sanctioning authorities is to encourage and permit humanitarian activity, there remain significant obstacles to achieving this objective. The paper offers insights into the key areas of complexity and the most urgent aspects requiring clarification. It expressly illustrates that striking the correct balance between the delivery of critical humanitarian responses and the application of United Nations and unilateral sanctions will necessitate some realignment. The paper concludes by highlighting the need for governments and sanctioning authorities to adopt a forward-leaning approach, and by stressing the necessity of collective and coordinated international action.

Keywords

sanctionsunilateral measurescounterterrorismlicensingrisk managementhumanitarian aidreconstruction
Type
Financial access, de-risking and the role of the banking sector
Information
International Review of the Red Cross , Volume 103 , Issue 916-917: Counterterrorism, sanctions and war , April 2021 , pp. 705 - 716
Copyright
Copyright © The Author(s), 2022. Published by Cambridge University Press on behalf of the ICRC

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References

1 For a detailed overview of sanctions targets and numbers, see the Sanctions by the Numbers newsletter produced by the Center for a New American Security, available at: www.cnas.org/sanctions-by-the-numbers (all internet references were accessed in December 2021).

2 During March and April 2020 there were numerous instances of countries writing to United Nations (UN) Secretary-General António Guterres calling for “complete and immediate” sanctions lifting. See, for instance, “COVID-19 and Sanctions: Letter of 18 Governments to the UN Secretary-General”, 18 April 2020, available at: www.uspeacecouncil.org/4955-2/. Beyond the actual lifting of sanctions, calls have also focused on the need for “sanctions relief”, including from UN High Commissioner for Human Rights Michelle Bachelet and UN Special Rapporteur on the Right to Food Hilal Elever. See UN Office of the High Commissioner for Human Rights, “Bachelet Calls for Easing of Sanctions to Enable Medical Systems to Fight COVID-19 and Limit Global Contagion”, 24 March 2020, available at: www.ohchr.org/en/NewsEvents/Pages/DisplayNews.aspx?NewsID=25744&LangID=E.

3 For example, in the context of COVID-19, both the United States and European Commission issued a series of publications in respect of exemptions and licenses. See, for example, US Department of the Treasury, “Provision of Humanitarian Assistance and Trade to Combat COVID-19”, fact sheet, 16 April 2020 (updated 17 June 2021), available at: https://home.treasury.gov/system/files/126/covid19_factsheet_20200416.pdf; European Commission, “Sanctions: Commission Issues Additional Guidance on Providing COVID-19-Related Humanitarian Aid in Sanctioned Environments”, August 2021, available at https://ec.europa.eu/info/sites/default/files/business_economy_euro/banking_and_finance/documents/210813-humanitarian-aid-guidance-note-statement_en.pdf.

4 In order for a situation to be considered an “armed conflict” under international law, a number of conditions must first be met. The author recognizes that some of the cases highlighted (i.e., Venezuela and North Korea) will not necessarily meet these conditions. However, the inclusion of such examples offers important lessons learned regarding sanctions and equally offers further context on the extent of humanitarian emergencies occurring across a range of sanctioned environments.

5 Damascus-Based INGOs, Understanding the Operational Impacts of Sanctions on Syria II: Damascus-Based INGOs and Bank De-Risking, April 2021.

6 For further information on the ACAMS International Sanctions Compliance Task Force humanitarian workstream, see ACAMS Sanctions Space, “ACAMS International Sanctions Compliance Task Force: Humanitarian-Sanctions Technical Dialogue Forum”, 1 March 2021, available at: www.acams.org/en/media/document/16941.

7 United Nations Development Program, The Afghan Banking and Financial System Situation Report, policy brief, 22 November 2021, available at: www.af.undp.org/content/afghanistan/en/home/library/knowledge-products/Policy-brief-banking-crisis.html.

8 Based on feedback received during the ACAMS International Sanctions Compliance Task Force: Humanitarian-Sanctions Technical Dialogue Forum meetings. For further information on the Dialogue Forum, see ACAMS Sanctions Space, above note 6.

9 For further information on the relevant digital technology issues, see Ashley Campbell, How to Navigate the Digital and Technology Landscape, Sanctions Masterclass Series Follow-Up Briefing Paper, ACAMS Sanctions Space, April 2021, available at: www.acams.org/en/media/document/19051.

10 Ibid.

11 For further detail, see Walker, Justine, Humanitarian Impact of Syria-Related Unilateral Restrictive Measures, National Agenda for the Future of Syria, 16 May 2016Google Scholar, available at: www.voltairenet.org/IMG/pdf/Humanitarian_Impact_of_Syria-Related_Unilateral_Restrictive_Measures.pdf.

12 For expectations on due diligence, including the legal thresholds of surrounding “ownership and control” considerations, see Justine Walker, Risk Management Principles Guide for Sending Humanitarian Funds into Syria and Similar High-Risk Jurisdictions, ACAMS, May 2020, available at: www.acams.org/en/media/document/10691.

13 Justine Walker, Navigating Humanitarian Exceptions, ACAMS Sanctions Compliance Occasional Paper, April 2020, available at: www.acams.org/en/media/document/10686.

14 US Department of State, “Caesar Syria Civilian Protection Act”, fact sheet, 17 June 2020, available at: http://2017-2021.state.gov/caesar-syria-civilian-protection-act/index.html.

15 The imposition, or threat of imposition, of secondary sanctions related to Iran, North Korea, Syria, etc. has grown considerably over recent years. For an overview of the cross-border legal, regulatory and compliance considerations, see Sultoon, Samantha and Walker, Justine, Secondary Sanctions’ Implications and the Transatlantic Relationship, Atlantic Council, Washington, DC, September 2019Google Scholar, available at: www.atlanticcouncil.org/in-depth-research-reports/issue-brief/secondary-sanctions-implications-and-the-transatlantic-relationship/.

16 See, for example, European Commission, “Afghanistan: Commission Announces €1 Billion Afghan Support Package”, press release, Brussels, 12 October 2021, available at: https://ec.europa.eu/commission/presscorner/detail/en/ip_21_5208.

17 For an overview of these deliberations, see Justine Walker, Afghanistan and Risk Managing Permissible Payments: Key Aspects Requiring Clarification and Future Public-Private Dialogue, Sanctions Rapid Response Briefing Paper, ACAMS International Sanctions Compliance Task Force, 9 September 2021, available at: www.acams.org/en/sanctions-afghanistan-response-paper.

18 See ACAMS, “Sanctions Masterclass: Jurisdiction and Sanctions Regime: Rapid-Fire Update (Afghanistan)”, September 2021, available at: www.acams.org/en/training/webinars/sanctions-masterclass-jurisdiction-and-sanctions-regime-rapid-fire-update-afghanistan.

19 See for example, Office of Financial Sanctions Implementation (OFSI), “OFSI Updates Charity Sector Guidance”, OFSI Blog, 1 November 2021, available at: https://ofsi.blog.gov.uk/2021/11/01/ofsi-updates-charity-sector-guidance/.

20 See J. Walker, above note 13.

21 ACAMS International Sanctions Compliance Task Force expert-level meetings with humanitarian actors, INGOs and financial institutions: first session held virtually, November 2021; second session held in Washington, DC, November 2021; third session held in London, December 2021.

22 Correspondent banking is the provision of banking services by one bank (the “correspondent bank”) to another bank (the “respondent bank”). Large international banks typically act as correspondents for thousands of other banks around the world. Correspondent banks are most likely to be used by domestic banks to service transactions into and from jurisdictions in which the latter do not have a physical presence. The provision of correspondent banking is viewed as an essential component of the global payment system, especially for cross-border transactions.

23 Justine Walker, Examining Viable Banking and Payment Options for the Movement of International Humanitarian Funds into Syria, National Agenda for the Future of Syria, 2017.

24 See EUR-Lex, “EU Restrictive Measures against Syria”, 20 January 2020, available at: https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=LEGISSUM%3A4336644.

25 J. Walker, above note 23.