If they want to stay compliant with increasing sanctions requirements, SMEs in the UK will have to move ‘staying alert to emerging geopolitical issues’ much higher up their to-do lists. The Russian invasion of Ukraine, Chinese spying, fears over a possible invasion of Taiwan and the difficulties of rebuilding supply chains after Brexit have all heightened their vulnerability to global crises and the sanctions which governments use to respond to them.
“SMEs have to expand their geopolitical knowledge if they want to stay ahead,” says Joel Lange, head of Dow Jones Risk and Compliance. “These rules no longer just affect global banks.”
The use of economic sanctions is nothing new, but the sweeping measures imposed against Russia following its invasion of Ukraine in February 2022 seem to mark something of a paradigm shift. This included asset freezes and travel bans for oligarchs, including the then Chelsea FC owner Roman Abramovich, as well as known Putin allies and spokespeople. Russian bank assets in the UK were also frozen, Russian state-owned and key strategic private companies were banned from raising finance in Britain, and trade and export controls were introduced on goods such as military tech and even jewellery.