New OFSI Legal Services General Licence for Russia and Belarus sanctions
The UK's Office of Financial Sanctions Implementation (OFSI) issued a new Legal Services General Licence (INT/2023/3744968) for Russia and Belarus sanctions, effective from 29 October 2023. This licence allows UK legal firms or counsel to receive payments from individuals designated under these sanctions without an OFSI-specific licence, subject to certain conditions.
Key changes in this licence include resetting the professional legal fees caps to UK£500,000 (including VAT), increasing the expenses caps to 10 per cent of legal fees (up to UK£50,000), and requiring reporting within 14 days of receiving payment. The reporting must include unredacted engagement letters and the Group ID of the designated person.
However, the licence does not authorise activities that may violate sanctions regulations, except as explicitly allowed. It expires on 28 April 2024, with the possibility of HM Treasury making changes or revoking it.
Payments received under this licence must be reported to HM Treasury within 14 days. Records of permitted activities must be kept for at least six years.
More information on the Licence INT/2023/3744968 and the relevant forms can be found here.
Cayman Islands issue General Licence for legal services following OFSI’s General Licence
On 15 November 2023, the Governor of the Cayman Islands, in collaboration with the Secretary of State published General Licence GU2023/0003 for legal services, allowing attorneys or law firms providing legal advice to individuals designated under the Russia or Belarus regime to receive payment without a specific licence, subject to specified conditions.
Key changes include a change of Attorney's fees caps to US$600,000, an increase in expenses caps to 10 per cent of legal fees (up to US$60,000), and a reporting deadline of 14 days for payments received. Notably, attorney's fees and expenses for defamation or malicious falsehood cases are not allowed under this licence.
Users are advised to refer to the Financial Reporting Authority (FRA) website for detailed information on definitions, permissions, and usage requirements, as they differ from previous licences. Reporting under this General Licence must include that the relevant letter of engagement sent to the Governor must be unredacted and the Group ID of the designated person must also be stipulated.
Payments made under this licence must be reported to the Governor within 14 days, using the specified reporting forms available on the FRA website. Record-keeping requirements mandate accurate records for a minimum of 6 years. Importantly, the licence does not authorise any actions that may violate the modified Russia or Belarus Regulations.
General Licence GU2023/0003 is effective from 15 November 2023 until 15 May 2024 and is subject to potential variations, revocations, or suspensions by the Governor at any time.
Virgin Islands issued General Licence No. 5 2023 (payment of reasonable professional legal fees and expenses)
On 13 October 2023, the BVI authorities released General Licence No. 5, 2023, addressing the payment of reasonable professional legal fees and expenses from designated persons.
You can find our detailed blog post on this topic here.
