In a significant move to reinforce economic sanctions against Russia, the UK Government has announced the formation of a new Office of Trade Sanctions Implementation (OTSI). Announced on 11 December 2023 by Industry and Economic Security Minister Nusrat Ghani, the OTSI is tasked with intensifying the crackdown on companies that attempt to evade sanctions imposed in the wake of the Russian invasion of Ukraine.
The creation of this dedicated unit is a response to the ongoing need to enforce stringent trade sanctions effectively. The OTSI will be responsible for the civil enforcement of trade sanctions, particularly those targeting Russia. This includes investigating potential breaches, issuing civil penalties, and referring cases for criminal enforcement to Her Majesty’s Revenue and Customs (HMRC) where necessary.
Minister Nusrat Ghani emphasized the success of the current sanctions, citing a significant 94% drop in goods imports from Russia to the UK since the imposition of the sanctions. Our package of sanctions, the most severe ever imposed on a major economy, is working,” said Ghani. The OTSI aims to further these efforts by preventing companies from circumventing sanctions through indirect methods, such as routing products through other countries.
The announcement also aligns with the UK’s plan to introduce new sanctions targeting specific items found on the battlefield in Ukraine, including machine parts and chemicals, as well as products contributing financially to Putin’s war efforts.
Sanctions Minister Anne-Marie Trevelyan highlighted the broader impact of the sanctions, estimating that Russia would have had over $400 billion more to fund the war without international sanctions. “We are hitting Russia where it hurts and starving Putin of the resources he needs to fund his illegal war on Ukraine,” Trevelyan stated.
The OTSI is set to launch in early 2024, following the implementation of the necessary legal frameworks. This move is a part of the UK’s ongoing efforts, in conjunction with international partners, to impose the most severe sanctions ever on a major economy, significantly impacting UK-Russia trade.
The establishment of the OTSI represents a pivotal step in ensuring the effectiveness of trade sanctions and demonstrates the UK’s commitment to upholding international law and supporting Ukraine in its struggle against Russian aggression.
