Sanctions and Export Control | UK Regulatory Outlook May 2023
Published on 25th May 2023
General licence for legal fees extended | OFSI publishes travel guidance
General licence for legal fees extended
The Office of Financial Sanctions Implementation (OFSI) issued a legal services general licence in October 2022, allowing the payment of legal fees owed by individuals and entities sanctioned under the Russia and Belarus regimes. In practice, that usually meant a UK law firm or barrister would not have to wait for an OFSI specific licence before receiving payment. That licence expired on 28 April 2023 and replaced with a new licence which will expire on 28 October 2023.
The new licence changes the cap on legal fees to £500,000 inc. VAT and the expenses cap to 5% of legal fees up to a maximum of £25,000. Legal fees and expenses paid under the expired licence will not count towards these caps and can be combined with the new caps. So, for example, if work is undertaken for a designated person that involves fees for legal work carried out in satisfaction of a prior obligation (£500,000 limit) and work undertaken post-designation (£500,000 limit), up to £1 million (inc. VAT) could be paid.
OFSI publishes travel guidance
OFSI has published guidance for applicants and potential applicants for OFSI licences relating to travel costs incurred in making their applications (for example, allowing them to attend legal meetings or court hearings). Such applications need to demonstrate that the relevant costs are reasonable. So, for example, applicants would need to explain why travel was necessary and alternative methods such as video conferencing were impractical.