HM Treasury announced 26 July that the UK’s Office of Financial Sanctions Implementation (OFSI) has amended Section 6.12, Refusal of a licence, of its UK Financial Sanctions, General Guidance, removing the option to “ask OFSI to review the decision” in circumstances where OFSI refuses to issue a licence. A licence is a formal authorisation provided by OFSI enabling a designated person to use otherwise frozen funds and/or economic resources for certain identified purposes or activities.

The relevant section now reads:

“If OFSI refuses to issue a licence, the proposed transaction or activities may not be lawful. OFSI will write to you giving reasons for refusing your application.

We may also refuse your application if you do not require a licence for the proposed transaction or activities.

If you have had an application for a licence refused, you have the following options:

• re-apply with new or supplementary evidence or new supporting arguments;

• re-apply under a different derogation (where applicable); or

• seek to challenge the decision in court.”

The opportunity to ask OFSI to review its decision was a long-standing option, and its removal leaves the applicant only with costly and time-consuming alternatives. If re-applying with new or supplementary evidence or arguments, as detailed in a recent OFSI blogpost, such re-application will be treated as a new application and will not be prioritised purely because it has been resubmitted. The other option of challenging the decision in court, by way of judicial review, is a lengthy process, taking approximately a year after submission of grounds to be heard by a court. Such an option is likely not conducive with the purpose for which the licence was sought. This decision, announced without prior indication or any stated reasoning, leaves applicants, particularly those without significant resources, with fewer options.