On December 21, 2023, HM Treasury’s Office of Financial Sanctions Implementation announced that it had amended Regulation 17A of the Russia (Sanctions) (EU Exit) Regulations 2019 to update correspondent banking restrictions. The amendment prohibits UK banks from processing payments that have been previously processed by a designated bank, or are intended for a designated bank. These transactions are prohibited even if the account holders that send and receive the funds are not designated, and the prohibition extends to UK credit or financial institutions. OFSI anticipates that a majority of transactions affected by the amendment will be those in which correspondent banking occurs earlier in the chain of transactions, or transactions involving a correspondent bank that is designated for the purposes of Regulation 17A.
OFSI also updated its Russia Sanctions Guidance to provide examples of scenarios where payments can be stopped under Regulation 17A. OFSI also noted that certain payments prevented by Regulation 17A might be permitted if a general or specific license applies.