What is the Government doing to ensure UK entities do not fund or supply the Russian war effort?
BTC investigates UK sanctions regime - including in relation to illegal settlements in Palestine.
Meeting details
The UK Government estimates that international sanctions on Russia, including the UK’s, have “deprived the Russian state of at least $450 billion in war funds” since its invasion of Ukraine in February 2022.
There is no specific information available on the impact of trade sanctions within that figure but restrictions on exports to Russia are intended to choke off access to the goods and services it needs as well as bite into the Kremlin’s revenues.
The UK currently has trade sanctions in place against more than 20 countries but the most expansive by far are against Russia and its proxy Belarus. The sanctions aim to deprive the Russian Government of income by restricting the export of Russian goods, and to disrupt Russia’s own access to goods and services, especially for military use, by restricting exports from UK companies. As a result, direct UK exports to Russia are now almost zero, and imports from Russia are largely prohibited.
But the UK’s regime is proving far from watertight. Concerns are mounting about UK company goods being supplied to Russia after export from the UK to a third country - whether inadvertent, negligent or deliberate.
There have been numerous reports of sanctioned goods being shipped from the West to one or multiple other countries, for example Turkey or in Central Asia, before being moved into Russia. This month the Times ran a major story on UK-made components being found in Russian drones used in Ukraine.
The UK’s National Crime Agency has also warned about gold coming into the UK that may originate in Russia but is not certified as such.
With circumvention of trade sanctions against Russia reported to be widespread, there are serious questions about how UK enforcement agencies are deploying limited resources. Alongside HMRC, the Office for Trade Sanctions Implementation will make a first appearance at the Committee – more than a year after it was established - for an account of its approach and impact so far.
Following previous work on the UK’s control of arms exports to Israel, the Committee will also consider the possibility of sanctions to “prevent trade or investment relations that assist in the maintenance of the illegal situation created by Israel in the Occupied Palestinian Territory" - as the ICJ has put it in an advisory opinion which the UK has stated it “does not disagree with”.
Rt Hon Liam Byrne MP, Chair of the Committee, said: “Sanctions are not statements of intent. They are instruments of enforcement.
“The Government says sanctions are working but the real question is why are any UK goods, UK finance, or UK markets still being used - directly or indirectly - to fund Russia’s war machine?
“If British-made components are ending up in Russian drones, or if Russian oil derivatives are showing up in our country we know our regime is not as watertight as it must be.
“Sanctions only work if they are enforced. That means proper scrutiny of circumvention through third countries, clear accountability, and agencies equipped to act. So our hearing will test whether the UK is matching strong words with strong enforcement and making good on our promises not to allow trade with Britain to fill the coffers of bad actors.”