The Criminal Finances Act 2017 (enacted in April 2017) introduced a series of measures of which a number, including Unexplained Wealth Orders (see related blog, Tackling Corruption: Unexplained Wealth Orders now in force) and the so-called "Magnitsky Amendment," have recently come into force.
We cover the implications and reach of the "Magnitsky Amendment" (s.13 of the Criminal Finances Act 2017) in our earlier blogs (see below), but in short, the amendment expands the scope of the existing civil asset recovery regime under Part 5 of the Proceeds of Crime Act 2002 specifically to capture the assets of those implicated in certain gross human rights abuses. As our blogs explain this has serious implications for both individuals and companies. The amendments target assets linked to abuses against two categories of people. The first (see our earlier blog, The Magnitsky Clause Part 1: Profiting from the suppression of whistleblowers – what does it mean for business?) relates to the suppression of whistle-blowers, and the second (see our earlier blog, The Magnitsky Clause Part 2: Profiting from the suppression of those who seek to assert their human rights?) relates to the suppression of those seeking to assert human rights and fundamental freedoms.
What does this mean for business?
Given the incredibly wide ambit of the "Magnitsky Amendment", companies are well advised to consider carefully their impact and the risk of human rights abuses in the widest sense. They will need to take into account the impact they have directly on a broad range of stakeholders; how they relate to these stakeholders; and the conduct of any companies / public bodies with whom they work. In the same way that companies must have mechanisms and polices in place to hear complaints from within the company, they must also be open to receiving and adequately investigating complaints from outside. Whilst undertaking robust human rights due diligence will not, without more, defeat an application under the new amendments it will, at least highlight areas of potential risk.