Joe Powell

I join colleagues in congratulating the right hon. Member for Chingford and Woodford Green (Sir Iain Duncan Smith) on securing the debate. As he rightly said, an effective sanctions regime is an increasingly important foreign policy and defence tool. Having worked on international anti-corruption and open government efforts for over a decade before I came to this place, I know that they can make a real impact. I agree with him that such a regime includes the threat of sanctions, as well as their execution. Like others, I am pleased that the Government have introduced over 900 new sanctions against individuals, entities and ships under the Russia sanctions regime, and over 60 designations under human rights and anti-corruption specifically. I know how seriously the Minister takes this tool, and I sincerely thank him and his officials for their complex work. I believe that the UK’s ambition on sanctions is at the edge of global leadership. That means that we must continually look for ways to make the system more effective, and I will suggest a couple of areas in which we might do so. One obvious area, in which I know the Government are working hard, is the transparency of asset ownership across jurisdictions. If we want sanctions to work, we need to know where the assets are, and transparency is an important prerequisite for effective targeting. To give one example, approximately 40% of the foreign-owned properties in Kensington and Chelsea are controlled by trusts. Through sanctions, our borough has one of the highest numbers of frozen properties. Trusts are not automatically included in the foreign-owned property register, and although information can now be made available on request, the lack of open data makes it harder to track real ownership. I know that the Government are considering that matter. Similarly, as my hon. Friend the Member for South Dorset (Lloyd Hatton) mentioned, the long-standing effort to bring in transparent beneficial ownership registers to the UK overseas territories and Crown dependencies would enable better tracking of assets under the control of sanctioned individuals. I support the Government review of asset and beneficial ownership in the UK, which is being carried out by anti-corruption champion Baroness Hodge, as part of the anti-corruption strategy, to identify vulnerabilities in that area. I hope that her recommendations can support our sanctions regime to be more effective. International data sharing on this issue is important. The illicit finance summit is coming up in May. Will the Minister outline whether sanctions policy, and international co-operation around it, will be on the agenda? On scope, we may benefit from looking more closely at how the two Magnitsky-style regimes interact, particularly in terms of corruption related to abuse of function, trading in influence and illicit enrichment, which bridge human rights and corruption. I hope that the Minister will keep under close review the potential effectiveness of sanctions relating to Georgia. I have met representatives of Georgian civil society, which has been calling for the UK to expand our sanctions further, including to Mr Ivanishvili and his top officials. For sanctions to be effective, they have to bite, and enforcement is critical. I welcome the Government’s approach of working multilaterally with allies to maximise effectiveness. However, it is also important that we look closer to home. Roman Abramovich is a former resident of Kensington and Chelsea, and still owns frozen property in my constituency. As the House will no doubt be aware, he was sanctioned in March 2022, and his UK assets were frozen. In May 2022, he sold Chelsea football club under an agreement that the sale proceeds would be used for humanitarian need in Ukraine. It is shameful that, almost four years later, that money has still not been released. I strongly welcome the Prime Minister’s leadership in issuing a licence last month to release the money within 90 days, and in making a commitment to taking legal action if necessary. This is a case of profound national and international importance—and a test of whether our sanctions have the bite that they need. Although I welcome the cross-party spirit with which the right hon. Member for Chingford and Woodford Green approached the debate, I find it astonishing that such a serious conflict of interest has now emerged at the top of the Conservative party. Sir Bill Browder—the man who spearheaded the global campaign for Magnitsky sanctions—has asked how it is possible that the shadow Attorney General can “moonlight as the attorney for a Russian oligarch who is trying to wiggle out of a £2.5 billion deal to aid victims of the war in Ukraine that he made with the UK Government? Back in the day that was called a ‘conflict of interest’”. I agree with Sir Bill, and I suspect the right hon. Gentleman has sympathy with that point, too. The detail matters here. Yesterday, Lord Wolfson published a letter saying that the Prime Minister got his facts wrong, and that he was not advising Mr Abramovich on UK sanctions or the proceeds of Chelsea FC. First, the Prime Minister did not in fact say that Lord Wolfson is advising Roman Abramovich on UK sanctions and the proceeds of sale of Chelsea FC. The Prime Minister did say, however, that Lord Wolfson is advising Mr Abramovich. That is true, as both Lord Wolfson and the Opposition spokesperson have now confirmed. The record should, in my view, be corrected. Secondly, Lord Wolfson’s letter omitted the most crucial piece of new information released by the Opposition spokesperson yesterday, which is that the shadow Attorney General has now recused himself from advising the Leader of the Opposition and shadow Ministers on Ukraine and Russia. Quite apart from whether someone can be an effective shadow Attorney General when they are unable to provide legal advice on the most important issues facing this country—Ukraine’s security guarantees to name but one—this recusal raises serious questions. Does it include efforts to tackle the Russian shadow fleet, including the military action yesterday? Does it include sanctions policy and enforcement? Does it include tax policy? The BBC reports that Abramovich could owe the UK up to £1 billion in tax after a botched attempt to avoid tax on hedge fund investments via shell companies in the British Virgin Islands. Thirdly, it is naive in the extreme to think it possible to separate the various legal cases that Mr Abramovich is engaged in and which affect UK national interests. According to The Times, Abramovich’s own representatives say that £1.4 billion of the proceeds from the sale of Chelsea cannot be released to a charitable foundation until legal proceedings brought by the Jersey Government are concluded. I would welcome clarification from the shadow Minister and the Minister on whether they consider that the ongoing litigation, and Mr Abramovich’s position on its connection to the transfer of the Chelsea FC proceeds, conflicts with the ability to transfer that money speedily? Fourthly, there has been a concerted effort to conflate the vital principle of the right to legal representation and the prevention of conflicts of interest. I absolutely support the right to legal counsel of people I may find disreputable or worse, including sanctioned individuals—that is the basis of a strong legal system—but it is a choice to serve as shadow Attorney General, and it is a choice to represent a sanctioned Russian oligarch in the Jersey case. My view is that those two roles are incompatible. By recusing himself from giving the Conservative party legal advice on Ukraine and Russia, Lord Wolfson has himself confirmed that, in his view, it is not possible give that advice while being paid to represent Roman Abramovich, and that, given the choice, being paid to represent Roman Abramovich is more important to him than fulfilling his duties as shadow Attorney General. He could have made the opposite choice, but he did not. I want our sanctions regime to be as effective as possible. I know that the Government are committed to continuing to learn and adapt as that regime evolves. I hope—I really mean this—that the Leader of the Opposition will clear up the mess that has been created and restore the cross-party consensus that is in our national interest.