Global Anti-Corruption Sanctions Regulations 2021 — House of Lords, 2021-05-26
Topic: International Affairs
Stephen Parkinson (Conservative, Centre-right): My Lords, as noble Lords will be aware, on 26 April Her Majesty’s Government laid these regulations under the powers provided by the Sanctions and Anti-Money Laundering Act 2018. These regulations were made on 23 April. As has been noted many times in your Lordships’ House, corruption is one of the key drivers undermining human rights, democracy, development and the rule of law around the world. It undermines global trade and prosperity. The World Economic Forum estimates that corruption increases the cost of doing business for individual companies by as much as 10%, distorting markets and deterring trade and investment. Corruption also undermines our national security, by exacerbating conflict and facilitating serious and organised crime. This new sanctions regime is a significant step forward for the UK’s global leadership in combating corruption around the world The instrument before the House will enable us to prevent and combat serious corruption around the world by imposing asset freezes and travel bans on individuals and organisations involved. The scope of the regime is deliberately targeted to combat corruption around the world, and to prevent corrupt actors and their enablers using the UK as a haven for dirty money. Its scope also draws on the corrupt practices that almost all countries in the world have agreed to combat through the UN Convention against Corruption As set out in the regulations, the activities which come into the scope of the regime are bribery and misappropriation. The regulations define bribery as both the giving of a financial or other advantage to a foreign public official and the receipt by a foreign public official of a financial or other advantage. They define misappropriation of property as improper diversion by foreign public officials of property entrusted to them in their official role, for their own benefit or that of a third person. Property can include anything of value, including contracts, licences or concessions The regulations also enable us to target those involved in corrupt acts in other ways, such as those who facilitate, profit from, conceal, transfer or launder the proceeds of serious corruption and those who obstruct justice relating to serious corruption. As my right honourable friend the Foreign Secretary noted in his April Statement: "whatever the particular circumstances, at the heart of this lies the same debilitating cycle of behaviour: corrupt officials ripping off their own people".—[Official Report, Commons, 26/4/21; col. 58.] These sanctions send a clear message to those involved in serious corruption around the world: that the UK will not tolerate them, or the proceeds of their corruption, coming into our country In the interests of clarity and transparency we have published a policy note which sets out how we will consider designations under these regulations, as well as an information note designed to help NGOs engage with the sanctions regime. As required by the sanctions Act, we have also published two statutory reports: one under Section 2 of that Act about the purposes of the regulations, and another under Section 18 setting out the criminal offences created by them. As with all UK sanctions, we adhere to rigorous due process and protections so that the rights of others are respected. This means that those designated under the sanctions regime will be able to request that a Minister reviews the decision and can subsequently apply to challenge that decision in UK courts. As noble Lords will be aware, the Government made immediate use of this new tool and announced sanctions last month on 22 individuals from six countries who have been involved in serious corruption. These names are published online on the UK’s sanctions list for these regulations. Each designation is underpinned by evidence and meets the tests set out in the sanctions Act and the regulations The designations include 14 individuals involved in the diversion of $230 million of Russian state property through a fraudulent tax refund scheme, uncovered by Sergei Magnitsky—one of the largest tax frauds in recent Russian history. We imposed sanctions on Ajay, Atul and Rajesh Gupta, and their associate Salim Essa, who were at the heart of a long-running process of corruption in South Africa which caused significant damage to the economy of that country. We also designated the Sudanese businessman Ashraf Said Ahmed Hussein Ali, widely known as al-Cardinal, for his involvement in the misappropriation of significant amounts of state assets in South Sudan, one of the poorest countries in the world. His actions, in collusion with South Sudanese elites, have contributed to ongoing instability and conflict. Finally, we announced sanctions on several individuals involved in serious corruption in Latin America, including people who had facilitated bribes to support a major drug-trafficking organisation and others who had misappropriated funds which led to citizens being deprived of vital resources for development. This is just the first tranche of designations. Given the sensitivities involved, however, I cannot speculate on whom we may target in future All targeted sanctions are most effective when backed by co-ordinated, collective action. The steps that we have taken to expand our sanctions framework, to cover corruption as well as human rights, give us similar powers to the Magnitsky frameworks of the United States of America and Canada. This will enable even closer co-operation and co-ordination with our like-minded friends and partners to combat and prevent corruption and its corrosive effects I welcome this opportunity to hear the views of noble Lords on these regulations. I beg to move.