OTHER THINGS YOU MAY HAVE MISSED – JULY 13

The protests continue, with the construction workers on a 24-hour stoppage. This despite a Government announcement of measures to address the cost of living problems. The wednesday charity lottery draw has been postponed until tomorrow, as the sellers weren’t able to reach the Loteria offices to submit returns or obtain material for the next draw.

13 JULY 2022

PUTIN TO MEET ERDOĞAN IN IRAN AMID HOPES FOR UNBLOCKING OF BLACK SEA ROUTES

On 12 July, Politico reported that the 2 Presidents are to meet in Iran as international efforts intensify to unblock Black Sea shipping routes and allow the resumption of Ukrainian grain shipments.

https://www.politico.eu/article/vladimir-putin-russia-recep-tayyip-erdogan-turkey-to-meet-in-iran-visit

MORE THAN 130 GRAIN SHIPS STUCK IN BLACK SEA AS TALKS START IN ISTANBUL

https://www.theguardian.com/world/2022/jul/13/more-than-130-grain-ships-stuck-in-black-sea-as-talks-start-in-istanbul-between-ukraine-and-russia-and-others

US COURT HOLDS THAT CHINA’S DATA PRIVACY LAW DOES NOT BAR DISCOVERY

On 6 July, a post on the Transnational Litigation Blog is concerned with a recent decision by a US court that China’s new data privacy law does not bar compliance with US discovery (disclosure) orders, because of an exception in the law for transfers necessary to fulfil statutory obligations.  However, the post notes that other Chinese laws limiting transfers of information do not have similar exceptions. 

https://tlblog.org/court-holds-that-chinas-data-privacy-law-does-not-bar-u-s-discovery

RUSSIA SHOULD NOT BE DESIGNATED A STATE SPONSOR OF TERRORISM

This post on the Transnational Litigation Blog on 11 July argued that such a decision by the US would have important implications for transnational litigation, and could also ultimately harm the interests of the Ukrainian government and the people of Ukraine.  In any case, it argues, it is unclear that these sanctions would have much effect on Russia because Russia is already heavily sanctioned by the US.  It would, however, potentially affect Russia’s sovereign immunity status, while only permitting US (and not other nationality) claims against Russia and its assets.

https://tlblog.org/russia-should-not-be-designated-a-state-sponsor-of-terrorism

SRI LANKA: PRESIDENT RAJAPAKSA FLEES TO MALDIVES

On 13 July, Nikkei Asia reported that President Gotabaya Rajapaksa fled to the Maldives hours before he was due to submit his resignation and while many of the protesters who had pressured him for months were asleep.

https://asia.nikkei.com/Spotlight/Sri-Lanka-crisis/Sri-Lanka-rages-at-PM-after-President-Rajapaksa-flees-to-Maldives

https://www.theguardian.com/world/2022/jul/13/sri-lanka-protesters-unrest-president-gatabaya-rajapaksa-flees-quit-economy-unrest

HOW THE RAJAPAKSA FAMILY FELL AFTER 15 YEARS AT THE TOP IN SRI LANKA

https://www.theguardian.com/world/2022/jul/13/how-the-rajapaksa-family-fell-after-15-years-at-the-top-in-sri-lanka

LESSONS TO BE LEARNED – FCA, JLT SPECIALTY LIMITED AND FINANCIAL CRIME CONTROL FAILINGS

On 12 July, an article from K+L Gates was focussed on enforcement action that the Financial Conduct Authority (FCA) took against JLT Specialty Limited for the second time in the space of a decade, and the lessons which can be taken from this.  In June, JLT was fined approximately £7.8 million for failure to comply with the FCA’s Principles for Business, specifically its risk management systems failed to counter the risk that it may be used to further financial crime, and involved its business with Colombia.  JLT is a UK-based provider of insurance broking, risk management, and insurance claims services.  JLT had been fined £1,876,000 fine in December 2013 for similar failings in its risk controls relating to overseas introducers, and the FCA noted that the conduct for which the latest fine was imposed began just months after the first financial penalty was imposed in 2013.

https://www.klgates.com/Lessons-to-be-Learned-FCA-Fines-JLT-Specialty-Limited-78-Million-for-Financial-Crime-Control-Failings-7-12-2022

US COMPANY PLEADS GUILTY TO FAILURE TO FILE EXPORT INFORMATION ON SHIPMENTS OF LAB EQUIPMENT TO RUSSIA AND UKRAINE

On 11 July, a news release from US DoJ announced that a laboratory equipment distributor had pleaded guilty to 14 felony counts of failure to file export information on shipments to Russia and Ukraine.  It was said that between 2015 and 2019 it exported laboratory equipment to Russia, Ukraine, and elsewhere, falsely describing the nature and value of the exported items on the commercial invoices and shipping forms.  It admitted that it used false, innocuous descriptions such as “lamp for aquarium” or “spares for welding system,” rather than accurately identifying the sophisticated scientific equipment actually contained in the shipments.

https://www.justice.gov/usao-nh/pr/intertech-trading-corp-pleads-guilty-14-felonies-failure-file-export-information

US: FORMER HERBALIFE CHINA EXECUTIVE ORDERED TO PAY FINE FOR FAILURE TO RESPOND TO SEC BRIBERY ALLEGATIONS

On 12 July, the Wall Street Journal reported that the former head of the company’s China subsidiary has been ordered to pay about $550,000 after he failed to respond to SEC allegations that he bribed Chinese officials.  The bribery scheme allegedly ran from 2006 to 2016. 

https://www.wsj.com/articles/former-herbalife-china-executive-ordered-to-pay-fine-after-defaulting-in-sec-case-11657650322

SWITZERLAND: RUSSIAN SANCTIONS WEAK LINK

A feature in the Wall Street Journal on 12 July was concerned with how Switzerland can and does implement sanctions against Russia.  It points out that in the town of Zug, well-known as a corporate base for very many companies (it is said 30,000) – and where so many Russian billionaires have homes or businesses here that the local opposition party had begun taking sightseers on an “Oligarch’s Tour” – there are just 6 local officials charged with helping implement sanctions.  However, 80% of Russia’s commodities are traded through Switzerland, mostly through Zug and Geneva, and 32 of the oligarchs closest to Putin are said to have property, bank accounts or businesses in Switzerland.  It notes that the country’s sanctions body, the State Secretariat for Economic Affairs (SECO), has only 15 officials, having hired 5 more recently.

https://www.wsj.com/articles/switzerland-playground-of-russian-oligarchs-emerges-as-weak-link-on-sanctions-putin-ukraine-war-11657624783

AUSTRALIAN: ACCESS TO A FURTHER 11 OFFSHORE GAMBLING WEBSITES TO BE BLOCKED

On 13 July, iGB reported that the Australian Communications and Media Authority (ACMA) has requested ISP in the country block access to a further 11 offshore gambling websites which it said were illegally offering online gambling.  This means that a total of 555 illegal gambling websites have been blocked, while more than 170 websites have pulled out of the country since the ACMA began enforcing new illegal offshore gambling rules in 2017.

https://igamingbusiness.com/acma-orders-blocking-of-another-11-offshore-sites

CENTRAL BANK OF IRELAND IDENTIFIES A ‘LACK OF UNDERSTANDING AND COMPLIANCE WITH KEY AML/CFT OBLIGATIONS’ IN VASP APPLICANTS

On 12 July, AML Intelligence reported that the Central Bank of Ireland has revealed there is a “lack of understanding and compliance with key AML/CFT obligations” in the vast majority of applications submitted by Virtual Asset Service Providers (VASP) to the regulator.  It has also identified “significant control weaknesses” in several VASP, while the “lack of compliance, coupled with control weaknesses, resulted in a significant number of the applicant firms not being able to demonstrate to the Central Bank that they could meet their AML/CFT obligations”.

https://www.amlintelligence.com/2022/07/central-bank-of-ireland-reveals-lack-of-understanding-on-aml-from-vasps/

INDIA: COURT HAS LIFTED A FREEZE ON SMARTPHONE MAKER VIVO’S BANK ACCOUNTS

On 13 July, NDTV reported that a court has lifted the freeze imposed by the country’s financial crime agency and ordering the Chinese company to provide a bank guarantee of $119 million.

https://www.ndtv.com/business/delhi-high-court-lifts-ban-on-vivo-bank-accounts-in-money-laundering-case-3153103

ART COLLECTOR OLIGARCH ACCUSED OF BREACHING SANCTIONS BY SELLING LUXURY CARS

On 13 July, Yahoo News reported that Petr Aven, a billionaire Russian oligarch with a £300 million art collection, is being targeted over allegations that he has broken international sanctions by buying and selling luxury cars.  The alleged breaches include transactions used to finance a £200,000 payment to 2 car dealers and a further £160,000 transfer suspected of covering up the sale of a Bentley.  2 corporate bank accounts used by Petr Aven were frozen by the NCA.

https://uk.news.yahoo.com/300m-art-collector-oligarch-accused-100513708.html

SANCTIONS-PROOF CORRIDOR TO RUSSIA VIA IRAN TAKES OFF

The Tribune in India reported on 13 July that an elaborate ceremony welcomed the first Russian cargo bound for India via the International North-South Transport Corridor (INSTC), a sanctions-proof land-sea transportation corridor passing through a dozen countries.

https://www.tribuneindia.com/news/nation/after-trial-run-in-june-sanctions-proof-corridor-to-russia-via-iran-takes-off-411837

US FLAGS CENTRAL ASIAN STATES OVER POTENTIAL SANCTIONS-DODGING

On 12 July, Eurasianet reported that 4 Central Asian states – Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan – have appeared on a US Government alert over their potential to facilitate the evasion of sanctions imposed against Russia and its ally Belarus over the invasion of Ukraine.  The alert did not accuse these or any of the other countries named – a diverse group that included Armenia, Georgia, China, Brazil, Israel, India, Singapore and Taiwan – of facilitating sanctions-dodging. However, it did say that they were among “certain common transhipment points through which restricted or controlled exports have been known to pass before reaching destinations in Russia or Belarus”.

https://eurasianet.org/washington-flags-central-asian-states-over-potential-sanctions-dodging

TRAFFICKING IN HUMAN BEINGS: GRETA ANNUAL REPORT

On 13 July, the Council of Europe advised that its Group of Experts Against Trafficking in Human Beings (GRETA) had published its annual report.  It says that GRETA carried out 10 country evaluation visits and adopted third round evaluation reports on 6 countries (France, Latvia, Malta, Montenegro, Romania and the UK). Israel became the second Council of Europe non-member state to accede to the anti-trafficking convention.  It says that child trafficking has continued to increase despite legislative and policy measures taken by states parties to the anti-trafficking convention.  It assesses the extent to which technology impacts human trafficking, the operational and legal challenges in detecting, investigating and prosecuting online and ICT-facilitated human trafficking offences, and contains a set of recommendations. 

https://www.coe.int/en/web/portal/-/trafficking-in-human-beings-expert-group-greta-releases-its-annual-report

IMO MEMBERS COMMIT TO COMBATING MARITIME SECURITY THREATS IN THE INDIAN OCEAN AND GULF OF ADEN

On 13 July, Defence Web reported that member states have agreed a raft of measures to combat new and emerging threats to maritime security.  A meeting acknowledged that maritime threats have evolved and expanded beyond piracy into other challenges that have a damaging effect on states’ economies. 

https://www.defenceweb.co.za/sea/sea-sea/imo-members-commit-to-combating-maritime-security-threats-in-the-indian-ocean-and-gulf-of-aden/

HIGH COURT PERMITS SERVICE BY NFT IN ‘ENGLISH LEGAL FIRST’

On 13 July, the Law Society Gazette reported that an Italian engineer trying to recover around £2 million of stolen cryptocurrency has been given permission to serve High Court proceedings via a non-fungible token (NFT) on the blockchain, in what his lawyers have said is an English legal first.

https://www.lawgazette.co.uk/news/high-court-permits-service-by-nft-in-english-legal-first/5113106.article

CORPORATE CRIME REFORM IN THE UK: UNAMBITIOUS? TOO AMBITIOUS? OR, JUST PLAIN UNREALISTIC?

On 12 July, an article from Hogan Lovells reflected on the Law Commission long-awaited Options Paper on Corporate Criminal Liability, which detailed possible options for the reform of corporate criminal liability in England & Wales.  It also says that 2 standout options relate to the “failure to prevent” offences in respect to fraud and human rights.

https://www.engage.hoganlovells.com/knowledgeservices/viewContent.action?key=Ec8teaJ9Var12CsuNfzZG8xgHJMKLFEppVpbbVX%2B3OXcP3PYxlq7sZUjdbSm5FIetvAtgf1eVU8%3D&nav=FRbANEucS95NMLRN47z%2BeeOgEFCt8EGQ0qFfoEM4UR4%3D&emailtofriendview=true&freeviewlink=true

CIVIL LAW: DEBT ENFORCEMENT IN ENGLAND & WALES

On 12 July, a briefing paper from the House of Commons Library considers the different methods of civil debt enforcement available to a judgment creditor in England and Wales.   It also considers the effect of insolvency upon enforcement.

https://researchbriefings.files.parliament.uk/documents/SN05746/SN05746.pdf

UK: UNDERSTANDING YOUR ROLE AS A COMPANY DIRECTOR AND YOUR RESPONSIBILITIES TO COMPANIES HOUSE

On 13 July, UK Companies House published updated guidance.

https://www.gov.uk/guidance/being-a-company-director#full-publication-update-history

UK: RESPONSE TO THE LEGISLATION TO COUNTER STATE THREATS (HOSTILE STATE ACTIVITY) PUBLIC CONSULTATION

On 12 July, the Home Office published the UK Government response to a consultation and says that it should be read alongside the National Security Bill which was introduced in Parliament on 11 May.  The consultation closed in July 2021.

https://www.gov.uk/government/consultations/legislation-to-counter-state-threats/outcome/legislation-to-counter-state-threats-hostile-state-activity-consultation-government-response-accessible

UK: INSOLVENCY & CRYPTOCURRENCY

On 12 July, an article in the New Law Journal says that the courts are still wrestling with the basics and explains why it’s time to get to grips with the insolvency context.  It starts by saying that  cryptocurrency has finally been recognised as property in English law; but how does that affect the management of an insolvent estate of companies and individuals?  It notes that on 31 May, HM Treasury launched a consultation on managing the failure of systemic digital settlement asset firms. 

https://www.newlawjournal.co.uk/content/unlocking-the-crypt-insolvency-cryptocurrency

EUROPOL REPORT: LATEST SITUATIONAL ANALYSIS ON TERRORISM IN THE EU

On 13 July, Europol published this report based on quantitative data provided to Europol by EU Member States on terrorist attacks, arrests and court decisions issued for terrorist offences.  Europol’s partners also provided valuable qualitative information and assessments that enrich the findings of the report. 

https://www.europol.europa.eu/publication-events/main-reports/european-union-terrorism-situation-and-trend-report-2022-te-sat

GLOBAL PIRACY AND ROBBERIES AT NEAR 30-YEAR LOW

On 13 July, Lloyds List reported that nevertheless the Gulf of Guinea and the Singapore Strait are most prone to piracy, and violence against crews continues, with 23 seafarers taken hostage and a further 5 threatened in the first half of 2022.  There were 58 reported incidents of piracy and armed robbery against ships in the first half of 2022, compared with 68 during the same period in the past year. 

https://lloydslist.maritimeintelligence.informa.com/LL1141588/Global-piracy-and-robberies-at-near-30-year-low

THE UBER FILES UPDATE

https://www.theguardian.com/news/series/uber-files

https://www.icij.org/

EU SCHENGEN REFORM: KEY CHALLENGES AND PROPOSALS

On 13 July, the EU Parliament Research Service issued a briefing paper saying that, building on previous attempts to reform the Schengen system, and responding to renewed calls for reform, in December 2021 the European Commission presented a new Schengen strategy.  This was accompanied by several proposals and measures aimed at revising the Schengen rules, enhancing police cooperation, reinforcing the management of external borders and strengthening the overall governance of Schengen.

https://www.europarl.europa.eu/RegData/etudes/BRIE/2022/733599/EPRS_BRI(2022)733599_EN.pdf

MORE THAN $4.7 MILLION STOLEN IN UNISWAP FAKE TOKEN PHISHING ATTACK

On 12 July, the Coin Telegraph reported that a sophisticated phishing campaign has seen attackers make off with at least $4.7 million worth of Ether.  However, the community is reporting the losses could be even greater.  It is said that the phishing attack works by sending unsuspecting users a “malicious token” called “UniswapLP”.

https://cointelegraph.com/news/more-than-4-7m-stolen-in-uniswap-fake-token-phishing-attack

US TRADEMARK AND COPYRIGHT OFFICES TO STUDY IP IMPACT OF NFT

On 12 July, Coin Telegraph reported that the US Patent and Trademark, and Copyright offices will explore the impact of NFT on intellectual property rights as lawsuits begin to stack up.  The 2 departments have agreed to conduct the study, conducting preliminary discussions to plot a plan of action that will include consultations with various stakeholders well-versed in the NFT landscape.

https://cointelegraph.com/news/u-s-trademark-and-copyright-offices-to-study-ip-impact-of-nfts

BARBADOS: BENEFICIAL OWNERSHIP REGISTER TO GET LEGAL BACKING

On 12 July, the Jamaica Register reported that Barbados is moving towards improving records of the beneficial owners of companies registered in the territory.  A government official indicated that a policy proposal has been made to the Government of Barbados for the establishment of a beneficial ownership register.

https://www.jamaicaobserver.com/business/breakthrough-in-barbados-beneficial-ownership-register-to-get-legal-backing/

PODCAST: PROFITING FROM HUMAN RIGHTS ATROCITIES IN SYRIAN PRISONS

In the latest TRACE podcast, Omar Alshogre, refugee, political activist and Georgetown University student, shares the wrenching story of his 3 years as a political prisoner in the worst of Syria’s prisons.  He discusses the role that extortion plays there, simultaneously delegitimizing the regime further and propping it up financially.  This episode was originally published in June 2021.

https://www.traceinternational.org/resources-podcast

THE LAST CHANCE TO RESTORE COMPLIANCE WITH THE 2015 IRAN NUCLEAR DEAL

On 13 July, an Issue Brief from the Arms Control Association says that, rather than producing a breakthrough and de-escalating tensions, talks have underscored that the inflexibility of the US and Iranian positions on issues extraneous to the JCPOA continue to jeopardise efforts to restore mutual compliance with the original 2015 nuclear deal.  Given the intransigence on both sides and the growing proliferation risk posed by advances in Iran’s nuclear program, it is increasingly likely that efforts to restore the JCPOA will soon collapse.  It says that the 2 sides must seize the moment now to find a creative approach to address the outstanding issues in the talks, namely Iran’s demand to lift sanctions designating the Islamic Revolutionary Guard Corps as a foreign terrorist organisation and for guaranteed economic benefits.

https://www.armscontrol.org/issue-briefs/2022-07/last-chance-restore-compliance-2015-iran-nuclear-deal

US: BIS’S NEW APPROACH TO IDENTIFYING “EMERGING AND FOUNDATIONAL TECHNOLOGIES”

On 1 July, Torres Trade Law published an article saying that the Export Control Reform Act of 2018 requires BIS to identify and establish appropriate controls on the export, reexport, or transfer (in-country) of “emerging and foundational technologies” that are “essential to the national security of the United States”.  A proposed Rule in May announced a change in BIS’s approach to identifying new technologies of high strategic importance for control, and that, moving forward, BIS will no longer distinguish between “emerging technologies” and “foundational technologies”, but “will characterize all technologies identified… as ‘Section 1758 technologies’”.  Considering the likely impact of this change, it says that BIS hopes its removal of the distinction between “emerging” and “foundational” technologies will expedite the process for identifying relevant technologies and implementing appropriate controls.

https://www.torrestradelaw.com/posts/BIS%E2%80%99s-New-Approach-to-Identifying-%E2%80%9CEmerging-and-Foundational-Technologies%E2%80%9D/285

THE NEW DoJ COMPLIANCE CERTIFICATION REQUIREMENT SEEKS TO “EMPOWER” CHIEF COMPLIANCE OFFICERS

An article from Torres Trade Law on 1 July said that a new policy pertaining to the Foreign Corrupt Practices Act and anti-corruption compliance has recently sent shockwaves through the corporate compliance community.  It would require both the Chief Executive Officer and the Chief Compliance Officer to certify at the end of the term of the agreement that the company’s compliance program is reasonably designed and implemented to detect and prevent violations of the law… and is functioning effectively.  It says that the new policy has already been applied in one FCPA case so far: a $700 million FCPA settlement with Switzerland-based commodities giant Glencore International AG.  The article considers the key takeaway from that case.

https://www.torrestradelaw.com/posts/Empowered-or-Exposed%3F/283

US CONGRESS AND THE DoJ MULL REFORMS TO FARA STATUTE & IMPLEMENTING REGULATIONS

An Insight from Torres Trade Law on 1 July is concerned with proposed changes to the Foreign Agents Registration Act of 1938 (FARA).  It says that FARA is experiencing a renaissance in public interest, media coverage, and governmental concern due, in large part, to a recent surge in enforcement activity from the DoJ over the past half-decade.   Both Congress and the DoJ are taking steps to reform the Act and its implementing regulations, respectively.

https://www.torrestradelaw.com/posts/Amid-Heightened-Enforcement%2C-Congress-DOJ-Mull-Reforms-to-FARA-Statute-Implementing-Regulations-/282

PALM BEACH ART DEALER INDICTED ON CHARGES RELATED TO ART FRAUD SCHEME

A news release from US DoJ on 13 July advised that Daniel Elie Bouaziz had been charged with mail fraud, wire fraud, and money laundering in connection with his alleged scheme to sell forged high-end artwork.

https://www.justice.gov/usao-sdfl/pr/palm-beach-art-dealer-indicted-charges-related-art-fraud-scheme

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EU: FURTHER GUIDANCE FOR MEMBER STATES ON THE TRANSIT OF GOODS FROM RUSSIA

On 13 July, the EU announced that it had published further guidance, as part of regular technical exchanges on the practical implementation of EU restrictive measures, which have been unanimously imposed by the EU Council, in response to Russia’s war of aggression against Ukraine.

https://ec.europa.eu/commission/presscorner/detail/en/IP_22_4507

https://ec.europa.eu/info/files/faqs-sanctions-russia-export-import-guidance_en

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ISLE OF MAN: RUSSIA AND BELARUS SANCTIONS CHANGES

On 13 July, the Isle of Man issued 2 news releases.  One amended 6 existing entries on the Belarus sanctions list.  On the Russian sanctions list, 2 existing entries have been amended and 16 others corrected.

https://www.gov.im/news/2022/jul/13/financial-sanctions-belarus/

https://www.gov.im/news/2022/jul/13/financial-sanctions-russia/

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