About Sanctions

What are Sanctions?

Sanctions are restrictive measures that are put in place by the United Nations (UN) Security Council, European Union (EU) Council, the United Kingdom (UK) or other countries in the international community to achieve a specific foreign policy or national security objective, as well as maintain international peace and security. Sanctions come in many forms and are developed in response to a particular circumstance. It may include designations for financial sanctions, including asset freezes; trade sanctions, including arms embargoes and restrictions; and immigration sanctions, known as travel bans. Such restrictions may limit the provision of certain financial services or restrict access to financial markets, funds, economic resources, trade and exports.

Why are Financial Sanctions Used?

International sanctions measures, including targeted financial sanctions are generally imposed on an individual, entity or regime to:

• Coerce a regime, or individuals within a regime, into changing their behaviour by increasing the cost on them to such an extent that they decide to cease the offending behaviour;
• Constrain a target by denying them access to key resources needed to continue their offending behaviour, including the financing of terrorism or nuclear proliferation;
• Signal disapproval, stigmatizing and potentially isolating a regime or individual, or as a way of sending broader political messages nationally or internationally; and/or
• Protect the value of assets that have been misappropriated from a country until these assets can be repatriated.

Who are subject to Financial Sanctions?

Financial Sanctions which are in effect, generally apply to:

• Any person in the Virgin Islands;
• Any person who is a British citizen, a British Overseas Territories citizen, a British subject, a British National (Overseas) or a British protected person who is ordinarily resident in the Virgin Islands;
• A body incorporated or constituted under the laws of the Territory; and
• any person on-board a ship or aircraft that is registered in the Territory.

The requirement of ensuring compliance with the obligations rests with the relevant entity or professional that is:

• A body registered, incorporated or constituted under the laws of the Virgin Islands or any part of the Territory and supervised by the Financial Services Commission.(This includes all Financial Institutions);
• A body registered, incorporated or constituted under the laws of the Virgin Islands or any part of the Territory and supervised by the Financial Investigation Agency. (This includes all Designated Non-Financial Businesses and Professions [DNFBPs] and Non-Profit Organisations [NPOs]; and
• any person on-board a ship or aircraft that is registered in the Territory.

Accordingly, all relevant persons are required to fully comply with the obligations set out in the legislation and to ensure that it has in place appropriate risk based mechanisms, policies and procedures to assess applicants for business, customers and business relationships to determine whether they are under any sanctions imposed by the UN and EU which are extended to the Territory as Sanctions Orders by the UK through Orders in Council.

What should you do?

1. Once a designation is made, in order to comply with the Financial Sanctions regime, relevant persons* and Non-Profit Organisations operating in or from within the Virgin Islands are required to:
   1. check whether you maintain any accounts or hold any funds or economic resources for the persons set out in the Annex to this Notice;    
   2. freeze such accounts, and other funds or economic resources;    
   3. refrain from dealing with the funds or assets or making them available (directly or indirectly) to such persons unless licensed by the Office of the Governor;    
   4. report any findings to the Office of the Governor, together with any additional information that would facilitate compliance with the Regulation;    
   5. provide any information concerning the frozen assets of designated persons that the Governor’s Office may request. Information reported to the Governor’s Office may be passed on to other regulatory authorities or law enforcement.
2. Failure to comply with financial sanctions legislation or to seek to circumvent its provisions is a criminal offence.
3. All enquiries, reports and license applications should be addressed to:

The Office of the Governor
Waterfront Drive
Road Town, Tortola VG1110
British Virgin Islands
[email protected]

*“relevant person” means a person carrying on relevant business as defined in the Anti-Money Laundering Regulations, 2008.