The Export Control Joint Unit and the Department for International Trade have revealed in a notice to exporters that HMRC received settlements ranging between £1,000 and £54,000. The financial penalties were issued to exporters across 10 settlement actions for unlicensed exports of or for a breach of licence conditions in relation to dual use goods, military goods and related activity controlled by the Export Control Order 2008.
Although the annual total for export control fines for 2021 was significantly less than the settlements received by HMRC in 2020 (which totalled £700,368.01) this could be a result of the COVID-19 pandemic. The figures over the past couple of years demonstrate that HMRC have used its discretionary power to impose civil monetary penalties in lieu of criminal prosecution for violations of the UK’s export control laws.
All UK importers should view the latest notice to exporters as a reminder of HMRC’s powers in relation to violations of UK export control laws. Alongside HMRC’s ability to issue monetary penalties, HMRC may also issue criminal fines or imprisonment. Given HMRC’s active role as an enforcer of UK export control laws, companies doing business in the UK should assess their current export licences to ensure that they are fit for purpose and take appropriate due diligence measures to allow them to remain compliant.
Hogan Lovells is available to assist you in ensuring compliance with UK export control laws.
Authored by Aline Doussin, Imogen Brooks, Iris Karaman, and Simi Malhi.