We are starting to see a trickle of sanctions judgments from the UK. This year, the High Court has already dismissed challenges to UK sanctions brought by a Belarussian technology company; a Russian businessman seeking the release of his yacht; and now – in a judgment published last week – a dual UK/US national, Eugene Shvidler, whom the UK government deems to be affiliated with the Russian oligarch Roman Abramovich.
Here I am going to offer some quick-and-dirty observations on the latest judgment, both on its own terms and within a broader context of UK sanctions law.
First of all, Shvidler’s citizenship is something that seems to have loomed large in the litigation, but ultimately turned out to be of little effect. Here is how Garnham J opens his judgment:
This case concerns the lawfulness of decisions by the Foreign Secretary to “designate” a British citizen under the sanctions regime established by the United Kingdom Government after the Russian invasion of Ukraine.
Appearing on Shvidler’s behalf, his barrister Lord Anderson KC conceded that Shvidler’s designation was compatible with the provisions of the Russia (Sanctions) (EU Exit) Regulations 2019 but mounted a human rights-based challenge (¶167):
Precisely because the permissible grounds for designation are so broad, and so marginally satisfied here, and because the fundamental liberties of a citizen have been so markedly curtailed and will remain so for an indefinite period of time, it is, [Lord Anderson KC] argues, imperative for the Court to scrutinise with particular care any reasoned plea that a designation is disproportionate or discriminatory. Those are the twin grounds upon which his designation is contested.
On the government’s behalf, Sir James Eadie KC argued (¶135):
that the Secretary of State has had regard to the impact of sanctions on the Claimant and his family and has specifically acknowledged that their impact will be particularly acute because of the Claimant’s British citizenship.
In the end, however, it is not clear that the claimant’s British citizenship made a great deal of difference to Garnham J’s conclusion that ‘the Secretary of State has had conscientious regard to the impact of designation on both the Claimant and his family’ (¶141), and therefore that ‘it cannot properly be said that the Secretary of State has failed to strike a fair balance between the rights of Mr Shvidler and his family and the interests of the community’ (¶144).
To my mind, governments’ ability to impose targeted sanctions on their own citizens is an issue whose implications have not yet been fully appreciated. As I outline in a forthcoming article, such sanctions are more common than one might expect (see pp. 18–20). This is perhaps less problematic in the context of ‘regime’ sanctions, such as here, than if sanctions are imposed based on an allegation of involvement in crime. (Imagine a world where, instead of prosecuting their citizens, governments froze their assets based on reasonable grounds to suspect or some other such low standard).
Secondly, the consequences of sanctions for Shvidler’s family are a theme throughout the judgment. Once again, while this does not seem to have mattered greatly for the outcome of the case, I wonder if this presages a greater future focus in litigation on the position of innocent parties caught up in sanctions.
Thirdly, I think it is reasonably clear by now that, post-SAMLA 2018, the UK framework for challenging sanctions is not dissimilar to that in the US. In both jurisdictions, the combination of a low threshold for imposing sanctions with an exacting standard of judicial review makes claimants’ lives difficult. And that is something that is here to stay.
Economic Crime Law 