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Financial services
Financial restrictions under the Counter-Terrorism Act 2008
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Financial restrictions against Iranian banks
21 November 2011
The Government has imposed a direction under Schedule 7 to the Counter-Terrorism Act 2008 requiring UK credit and financial institutions to cease all business with banks incorporated in Iran and their branches and subsidiaries. This means that UK credit and financial institutions are prohibited from entering into transactions or business relationships with these entities and continuing existing transactions and business relationships with them, unless licensed to do so by HM Treasury.UK Direction is contained in the Financial Restrictions (Iran) Order 2011 which can be downloaded below.
Written Ministerial Statement
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The Financial Secretary to the Treasury, Mark Hoban MP, laid a Written Ministerial Statement in Parliament on 21 November 2011 setting out the reasons for giving the Direction.
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Releases
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HM Treasury have produced a notice to explain what the restrictions are and how they interact with existing financial sanctions against Iran. The notice contains contact details for any enquiries about the restrictions.
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General Licences
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HM Treasury have issued six general licences in relation to the Direction. An explanation of the general licences can be found in the notice on the restrictions.
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- General Licence 1: transactions for or related to humanitarian activities or purposes, including the export of medical equipment or foodstuffs and the provision of healthcare, under €40,000. (PDF 73KB)
- General Licence 2: transactions for or related to personal remittances (that is, payments between persons acting in a non-commercial, private capacity, the payments not being made in the course of a business), under €40,000. (PDF 72K)
- General Licence 3: transactions in relation to the provision of insurance which is permitted under Article 26(2) and (3) of EU Regulation 961/2010 against Iran. (PDF 72KB)
- General Licence 4: holding of asset-frozen Iranian banks’ accounts. (PDF 73KB)
- General Licence 5: holding accounts in the name of Iranian banks. (PDF 74KB)
- General Licence 6: completion of payments to or from Iranian banks in progress at the time of the Direction coming into force (PDF 63KB)
Licence Application form
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BIS Notice to Exporters
The Counter-Terrorism Act 2008
The Counter-Terrorism Act 2008 allows the Treasury to act in response to risks posed to the UK by money laundering, terrorist financing, and the proliferation of chemical, biological, radiological or nuclear weapons.
- Counter Terrorism Act 2008 (original legislation, as enacted)
- Amendment to Schedule 7 of the Counter Terrorism Act
- HMRC guidance on the Counter Terrorism Act (external website, opens in a new window)
- HMT Guidance on domestic orders under the Counter Terrorism Act
- Joint Money Laundering Steering Group guidance (including Counter Terrorism Act) (external website, opens in a new window)
These powers mean the Treasury can require UK financial and credit institutions to undertake a graduated series of measures in their dealings with designated individuals, firms, governments, or countries.
The measures range from conducting enhanced due diligence on designated entities, to limiting or ceasing business with them.
The information and links below will be helpful to businesses subject to the Money Laundering Regulations and directions issued by the Treasury under the Counter-Terrorism Act.
EU regulation: financial restrictions against Iran
- HM Treasury notice on the financial measures included in this Regulation (PDF)
- EU Council decision (full text, PDF – EU 2010/644/CFSP)
- EU Council regulation (full text, PDF - EU 961/2010)
If you have a query on financial restrictions under Schedule 7 to the Counter-Terrorism Act 2008 that is not answered in the above guidance, please email afu@hmtreasury.gsi.gov.uk
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