The UK’s Industry and Economic Security Minister, Nusrat Ghani, today announced the creation of a new civil enforcement unit, the Office of Trade Sanctions Implementation (OTSI). OTSI is expected to become operational early next year, and will focus on the civil enforcement of trade sanctions, including in relation to the circumvention or evasion of the current and evolving trade sanctions imposed by the UK in response to Russia’s invasion of Ukraine. HMRC will remain responsible for criminal enforcement of the trade sanctions. The government’s press release notes that the creation of OTSI comes as the UK is expected to announce further sanctions in relation to the latest items Ukraine has found on the battlefield such as machine parts and electronics.
This development further signals the growing emphasis that UK authorities, together with its international allies, are placing on the investigation and enforcement of the sanctions following a long period of implementing wide ranging measures.
To date, reported cases on the enforcement of trade sanctions in the UK has been relatively low with more focus on compound penalties imposed by HMRC for contraventions of UK export and trade controls. It remains to be seen whether the introduction of OTSI will result in an increase in investigations of alleged breaches of UK trade sanctions and related enforcement, or the extent to which new civil penalty powers will be deployed.