Sanctions

Chris Bryant Excerpts

Wednesday 19th July 2023 Commons Chamber

[The Minister of State, Foreign, Commonwealth and Development Office (Anne-Marie Trevelyan)]

I beg to move,

That the Russia (Sanctions) (EU Exit) (Amendment) (No. 3) Regulations 2023 (SI, 2023, No. 713), dated 27 June, a copy of which was laid before this House on 29 June, be approved.

The regulations amend the Russia (Sanctions) (EU Exit) Regulations 2019. The instrument was laid on 29 June 2023 under powers in the Sanctions and Anti-Money Laundering Act 2018. The measures in the instrument, which entered into force on 30 June 2023, have been co-ordinated with our international partners, while refining the approach to accommodate the particular circumstances of the UK’s legal sector. By restricting access to additional services from the UK, they will contribute to increasing the pressure on Putin for waging his illegal and brutal war against Ukraine. The measures place further constraints on the Russian economy, and therefore Putin’s war machine. They add force to the largest, most substantial package of economic sanctions that Russia has ever faced.

The instrument delivers on the commitment made by the UK Government to ban legal advisory services on specified commercial activities. That will further hamper the ability of Russian businesses to operate internationally. The legislation will make it illegal for any person working in the UK, as well as all British nationals working abroad, to advise on or facilitate certain commercial activities that would be sanctioned by the UK Government if they involved a British national or entity, or were taking place in the UK. In practice, that will make it harder for Russia to benefit from the UK’s world-class legal expertise. That goes beyond prohibitions already in place, which cover a range of professional services, including accountancy, architecture and management consultancy. This latest measure demonstrates our determination to ratchet up pressure on Putin for continuing his illegal war.

Although the legislation will close down opportunities for Putin’s associates and supporters to benefit commercially from the UK’s legal expertise, it is important that we ensure that legal services can continue to be provided where they contribute to upholding the rule of law and compliance with our sanctions framework. By protecting the fundamental right to legal representation, we distinguish ourselves from Putin’s oppressive regime. By ensuring that legal advice can continue to be provided for the purposes of compliance with our sanctions framework, we enhance the effectiveness of our regulations and intensify the pressure on Putin.

Legal professionals are under a strict obligation to ensure that their services support their clients to be sanctions-compliant, and do not stray into enabling them to circumvent restrictions. It has become apparent, however, that the legislation can be interpreted as having the unintended consequence of prohibiting persons in the UK and British nationals abroad from providing legal advice to clients seeking to comply with the sanctions regimes of our international partners. It is not the intent of these regulations to prohibit that type of legal service. UK lawyers should be able to support their clients to be sanctions-compliant beyond UK law as we work closely with our allies to tighten the net on Russia’s economy.

We have looked at this issue thoroughly and, as an immediate response, we are working across Government and alongside representatives of the legal sector to implement a general licence that will make it clear that that type of activity can continue.

[Sir Chris Bryant (Rhondda) (Lab)]

The Minister is addressing a point that the Law Society has made to quite a few of us, and I guess quite a few of us will be referring to it later in the debate. If this had been primary legislation, we would have tabled an amendment. Is it not normally better for us to do all the scrutiny of this kind of work on primary rather than secondary legislation? Then we can always help the Government to get it right first time.

[Anne-Marie Trevelyan]

The hon. Gentleman is generous as ever in offering to assist us to make progress. I hope that, as we bring in the secondary legislation, it will be another step towards tightening the pressure on those who would wish to use legal representation for the wrong things.

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[Sir Chris Bryant (Rhondda) (Lab)]

It is a joy to follow the hon. Member for Henley (John Howell). Since we have been in valedictory mood today, with the Secretary of State for Defence earlier, it is a sadness that the hon. Gentleman will not be with us in the next Parliament. Obviously, I want Labour to take every seat in the land, so I would not want to go too far in that. None the less, the hon. Gentleman has been admirable in his work in the Council of Europe in this regard and on human rights generally across the continent. Our membership of the Council of Europe is an important part of the structure of human rights across Europe. It is one of the reasons I support our remaining in the European convention on human rights and adhering to the European Court of Human Rights, which I understand to be a necessary aspect of our membership.

[John Howell]

I reassure the hon. Gentleman that I hope to stay in the role for another year.

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[Sir Chris Bryant]

Long may he persist.

I support the measure before us today. The Minister knows that I and other Members have campaigned for as robust a set of sanctions as possible. I have been critical sometimes of the processes we have used to get there. Oliver Bullough wrote a splendid book that lays out why it is important to deal not only with financial instruments but with some of the people who have effectively enabled others to bypass sanctions regimes and hide their money from prying eyes in the UK.

It was a joy to hear the extremely learned hon. Member for Bromley and Chislehurst (Sir Robert Neill), not least because he referred to “every decent lawyer”. I detected a characteristic wink at that point, because not every lawyer is decent, m’lud. I gently suggest—

[Sir Robert Neill]

rose—

[Sir Chris Bryant]

Now look what I have done.

[Sir Robert Neill]

I have prosecuted some less than decent lawyers over the years, so I take the hon. Gentleman’s point. But he knows just how good the English legal system is collectively, and I know he will want to recognise that.

[Sir Chris Bryant]

I have great admiration for lawyers, especially those who advise me, as is occasionally necessary—[Laughter.] It is a serious point: if the UK stands for anything in the world, it is the rule of law. The hon. Gentleman and I have often had to join cause on occasions when we have worried that the Front Benches have not quite seen things in exactly the same way as we do.

I will not rehearse all the arguments, which were laid out so beautifully for the hon. Gentleman and others in the Law Society’s note. He understood it better than I did. The important point is that all British businesses should be withdrawing from Russia. It is extraordinary that any British businesses are still doing significant business in Russia. I do not wish to make any partisan points, but I think it is still true that Infosys has a substantial presence and has not managed to wind down its presence in Russia. That is worrying. Mantrac is certainly still operating in Russia, and some of the money it has earned there will have made its way into its recent £5 million donation to the Conservative party. We should be doing more due diligence about these matters.

I do not understand how Unilever can still claim that it is only selling Magnum ice creams in Russia because they are an essential item. They might be an essential item for somebody who is going to watch the “Barbie” movie later this year—that sort of fits—but in all seriousness, I honestly do not think that Unilever should still have a significant presence, or any presence, in the Russian Federation. Its remaining there is a problem. I hope that the Minister will be able to respond to the point about British companies being able to advise on how to disinvest as fast as possible. If the regulations were to make that more difficult, that would be a bit of an own goal on our part.

I have some other, very minor, points to make. One is that the sanctions regime is now getting very complex. These are No. 3, the third regulations in this Session. I know that this Session of Parliament has gone on a bit—one could argue that the whole of this Parliament has gone on a bit, maybe a bit too long—but we are relying on lots of statutory instruments and secondary legislation. The amount of such legislation has grown enormously over the past 20 years, not just since 2010 but before then, and there is a danger that it is very difficult for lawyers to keep up with what the law is. Of course, there is no excuse for lawyers to say that they do not know what the law is, but none the less, these regulations came into force on 30 June—they are already in force. That is the problem with the way in which we are legislating these days. When there is a Labour Government, I hope that we will use secondary legislation much less frequently, because we need to be able to amend legislation on the Floor of the House or in Committee to make sure that Governments do not make silly mistakes.

I note the subtle difference in the exemption that exists for advice. Of course, advice can cover a multitude of sins and is sometimes designed to do so, but I note the subtle difference between the exemptions granted in the UK, those granted in the US and those granted in the EU. If I heard the Minister correctly, she attributed those to the different legal systems that exist in those jurisdictions. That may be true, but I would like her to expand on that and explain why it is necessary for us to make distinctions in that way. Otherwise, the point made by the hon. Member for Bromley and Chislehurst is absolutely right: an international law firm could just say, “All right, I’m popping over to Paris, Madrid, Berlin or wherever for the weekend, and we will do it from there.” That would be a mistake. I also think that sanctions need to be a stiletto blade, not a blunderbuss, if they are to be truly effective in peeling away support from Vladimir Putin within the Russian Federation.

In a previous debate on sanctions, I referred to the former leader of UKIP. Let me be absolutely clear: I have had no correspondence of any kind—electronic, in writing, or digital—with Coutts bank about him, or for that matter about anybody else, because I do not have many constituents who bank with Coutts. I have no idea why Coutts has closed his bank account, but I should have been more careful with the words that I used a year ago. The figure I gave was for his total income. I think he himself has stated that he was paid for his appearances on Russia Today, which is of course a part of the Russian state, and he has made clear his respect for Vladimir Putin as a nationalist. However, I do not think that the figure I gave was anywhere near the accurate figure, so I apologise if I have inadvertently misled the House. I had no intention of doing so, and I hope that puts the record straight. I had hoped that this afternoon’s debate was going to include a debate on the Procedure Committee’s report into allowing all Members of the House to correct the record, rather than just Ministers, but that option is not yet available to us. As such, Madam Deputy Speaker, I have rather stretched your generosity in making these comments.

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[Anne-Marie Trevelyan]

Obviously, the hon. Member would not expect me to discuss the detail of matters that are live and ongoing. However, we work as a team and across Government: while it is the Foreign, Commonwealth and Development Office that holds the pen, and it is me at the Dispatch Box today, the legislation, work, management and enforcement issues are covered across Whitehall. We all work together very closely on those issues, and as I say, it is a live and continually changing environment as we keep track of what we are trying to achieve. One part of that, of course, is ensuring that enforcement can be monitored. The commitment of £50 million following the integrated review refresh was an important part of that and it will help us build even stronger enforcement tools to ensure we make the most effective use of the sanctions we bring in.

This, Madam Deputy Speaker, is the latest edition of our package of sanctions. We will continue to use sanctions to keep up the pressure until Putin ends his horrific, senseless war and Ukraine is allowed its territories back to live peacefully once again.

[Sir Chris Bryant]

Will the Minister allow me to intervene before she sits down?

[Anne-Marie Trevelyan]

Yes, I will.

[Sir Chris Bryant]

I would just like to put on the record how much we respect and admire the team of roughly 150 people who work in the sanctions group. It is not easy work—it is tough to get it right—and they are magnificent. Is that in order?

[Madam Deputy Speaker (Dame Eleanor Laing)]

That is in order.