Sanctions are in place in respect of North Korea. For more information, see Practice note, Sanctions: breach of prohibitions.

The Office of Financial Sanctions Implementation (OFSI) has published guidance on the requirements for credit and financial institutions under the new measures in Article 5a of the amended EU Regulation 329/2007 (the Regulation) introduced on 4 May 2016.

Article 5a requires credit and financial institutions to:

• Refrain from opening new branches, offices, subsidiaries, or banking accounts in North Korea.
• Close existing branches, subsidiaries or banking accounts in North Korea where the national Competent Authority (HM Treasury) has determined that they could contribute to North Korea’s illicit programmes.
• Refrain from entering into new joint ventures, ownership interests, and correspondent banking relationships with North Korean banks, unless authorised to do so by an OFSI licence.
• Terminate existing joint ventures, ownership interests and correspondent banking relationships with North Korean banks.

In addition, where a UK credit or financial institution suspects that any activity that they participate in could contribute to North Korea’s nuclear or ballistic missile programmes (or other activities prohibited by the Regulation), they are required to promptly inform OFSI. In practice, this means financial institutions should submit all the evidence that leads them to this suspicion. Breaching these obligations may constitute a criminal offence.

Source: OFSI: Guidance for credit and financial institutions on Article 5a of EU Regulation 329/2007, 20 May 2016. = http://bit.ly/1TqjOuQ