Due Diligence and Sanctions
Due Diligence Processes
The due diligence processes for partners on research and innovation projects is described here. The due diligence will be conducted by Research Services for all externally funded projects and will include checks on whether sanctions apply.
Sanctioned countries can be defined as broadly restricted (the whole country) or narrowly restricted (only certain entities or individuals). The most important ones are those considered broadly restricted by one of the major authorities (the US, UK, EU and/or UN). For those countries, we may not be able to send or receive funding or travel to them
Broadly Restricted (Sanctions against them by the US, UK, EU and/or UN)
- Iran *
- North Korea *
- Crimea (annexed area)
- Donetsk People's Republic (aka DNR)
- Luhansk People's Republic (aka LNR)
- Cuba *
* US sanctions are VERY strong here.
The UK Government maintains a list of countries subject to trade sanctions, arms embargoes and other trade restrictions and/or limited sanctions on specific government agencies, officials etc. These are mainly issues with individuals and other organisations/people associated with them.. This will be checked as part of Due Diligence processes but researchers should also be familiar with this list.
As well as the broadly restricted nations, and those with narrow restrictions on certain individuals and organisations, there is a list of countries where there are certain other restrictions on certain goods and information dependant on the nation in question. For these other restrictions, the countries could be subject to specific arms embargoes, ECOWAS (in Africa), certain trade sanctions or other trade restrictions. A list of these countries can be seen at – https://www.gov.uk/guidance/current-arms-embargoes-and-other-restrictions#arms-embargo-trade-sanctions-and-other-trade-restrictions.
Certain goods transiting the UK are regarded as being exported when they leave the country and are subject to control. No exception applies to certain goods destined for countries listed here, meaning that a licence is required to transit goods through the UK or tranship them in the UK with a view to re-exportation to these countries. The Export Control Order 2008 includes a list of the countries which are subject to transit controls for military goods, software and technology, and a list of countries which are subject to transit controls for Category B goods. Military goods are those as listed in Schedule 2 to the Export Control Order. Category B of the controls comprises small arms and light weapons, unmanned aerial vehicles (UAVs), long-range missiles and man-portable air-defence systems.
As well as considering whether sanctions may be applicable to your project, certain countries also have other considerations to take into account, including:
- Is the partner organisation based in India? If yes, have they set up a Government approved FCRA account with the designated bank – SBI in New Delhi - into which funds can be transferred? (https://fcraonline.nic.in/Home/index.aspx#).This is a requirement to enable the transfer of payments to Indian institutions and so this should be checked in advance if funds are to be transferred.
- Is the partner a Chinese university? If yes, what is their China Defence Universities Tracker rating on https://unitracker.aspi.org.au/? The majority will either not be listed, or will have a low or medium rating, these will be OK to work with. If Very High Risk or High Risk ratings are given for the Chinese institution, please check for further guidance on their suitability as a potential partner in the project.
- Are there any local, regional, national requirements that may impact on the project e.g. import controls, ethics, research permit, requirement for special visas to be obtained prior to conducting research in the project country? (e.g. Kenya)
As an academic, it could be helpful with developing projects and proposals to have some thoughts and consideration for the status of your proposed partners. To assist in developing an initial understanding of potential partners and their suitability with the proposed research, please consider utilising this following checklist for Basic Partner Due Diligence Questions.