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You are here: BAILII >> Databases >> England and Wales High Court (Administrative Court) Decisions >> Khan v The Secretary of State For Foreign, Commonwealth and Development Affairs [2024] EWHC 361 (Admin) (20 February 2024) URL: https://www.bailii.org/ew/cases/EWHC/Admin/2024/361.html Cite as: [2024] EWHC 361 (Admin) |
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OF ENGLAND AND WALES
KING'S BENCH DIVISION
ADMINISTRATIVE COURT
In the matter of an application pursuant to section 38 of the
Sanctions and Anti-Money Laundering Act 2018
Strand London WC2A 2LL |
||
B e f o r e :
____________________
ANZHELIKA KHAN | Applicant | |
| - and - | ||
THE SECRETARY OF STATE FOR |
||
FOREIGN, COMMONWEALTH AND |
||
DEVELOPMENT AFFAIRS | Respondent |
____________________
David Blundell KC, Catherine Brown and Femi Adekoya (instructed by the Government Legal Department) for the Respondent
Hearing dates: 23 January 2024
____________________
VERSION
OF JUDGMENT APPROVED
Crown Copyright ©
Mrs Justice Cockerill:
INTRODUCTION
Khan
("Ms
Khan")
is a Russian born British citizen. She has lived in the UK since 2013 and became a citizen in 2019. She applies to set aside a decision of the
Secretary
of
State
for
Foreign,
Commonwealth
and
Development
Affairs
("the
Secretary
of
State")
to take no action (ie. to maintain) Ms
Khan's
sanctions designation under the Russia (Sanctions) (EU Exit) Regulations 2019 ("the 2019 Regulations") following a review of the original designation decision. Ms
Khan's
claim is brought pursuant to s 38(2) of the Sanctions and Anti-Money Laundering Act 2018 ("SAMLA").
Khan's
primary role in life is as mother and caregiver to her children, of whom there are four: ranging in age from a married daughter with her own family, down to a son who is not yet in his teens. Secondarily Ms
Khan
is the manager of
various
properties which she owns and is an art collector of some note. It is common ground that she (i) is not, and has never been, involved in political
affairs
(in Russia or elsewhere); (ii) has never provided material support to the Putin regime; and (iii) wields no personal economic influence capable of affecting the
foreign
policy of the Government of Russia.
Khan
is, however, the wife of Mr German
Khan
("Mr
Khan").
Mr
Khan
was born in Kyiv, Ukraine. He has over the years amassed a
very
substantial fortune, estimated in open source reporting as about US$7.55 billion. A substantial part of that fortune derives from investments and businesses in Russia, such as the Alfa Group and Alfa Bank - Russia's largest privately owned bank. At the time of Ms
Khan's
designation he was said to be on the Supervisory Board of the Alfa Group Consortium and the Board of Directors of ABH Holdings S.A., owner of Alfa-Bank (Russia), and Chairman of the Supervisory Board of A1 Investment Holding S.A., a company described by the Alfa Bank website as a "leading investment company in Russia – an expert in resolving complex business cases and corporate disputes".
Khan
has a proximity to the Russian government and Mr Putin. Mr
Khan
remained primarily resident in Russia when Ms
Khan
and their children relocated to the UK. Mr
Khan
was designated under the UK sanctions regime on 15 March 2022. That designation has never been challenged.
Khan
has given Ms
Khan
many
very
substantial gifts, including his shares in four properties and financial gifts totalling some hundreds of millions of pounds. In early March 2022 – just before he was sanctioned - he gave Ms
Khan
the single largest gift to date ("the March Gift"): one which represents a significant proportion of the amounts given over the years.
Khan
was designated on 20 April 2022. The basis for this designation is that there are reasonable grounds for believing that Ms
Khan
is a person who is "associated with" an involved person, i.e. Mr
Khan
(this falls within Regulation 6(2)(d), described further below). Ms
Khan
is regarded as being associated with Mr
Khan
both because she is married to him and because she has obtained "a financial benefit or other material benefit" from him. Ms
Khan
was subject to an asset freeze and a transport sanction.
Khan
requested a Ministerial review of her designation under s.23(1)(b) SAMLA. On 28 February 2023, following a Ministerial review, her application was refused and her designation maintained.
Khan's
designation was
varied
to impose a trust services sanction.
Khan
challenges the decision to maintain her designation on three grounds. She contends that:
1) The
Secretary
of
State
failed to consider whether her designation was likely to further the statutory purpose of the 2019 Regulations, thereby acting ultra
vires
the 2019 Regulations, and/or failed to have regard to a mandatory relevant consideration, and/or acted unreasonably;
2) The designation constitutes a disproportionate interference with her rights under Article 8 and Article 1, Protocol 1 ("A1P1") of the European Convention on Human Rights ("ECHR"); and
3) Regulation 6(2)(d) of the 2019 Regulations is incompatible with Article 8 and A1P1 ECHR.
THE UK SANCTIONS REGIME
v
PJSC National Bank Trust and another [2023] EWCA Civ 1132 and Garnham J in Shvidler
v
Secretary
of
State
for
Foreign,
Commonwealth,
and
Development
Affairs
[2023] EWHC 2121 (Admin). The account below concerns only those portions of the regime which are necessary for the understanding of the judgment; those wishing for further detail can find them in the earlier judgments.
"1 Power to make sanctions regulations
(1) An appropriate Minister may make sanctions regulations where that Minister considers that it is appropriate to make the regulations—[…]
(c) for a purpose within subsection (2).
(2) A purpose is within this subsection if the appropriate Minister making the regulations considers that carrying out that purpose would—[…]
(b) be in the interests of national security,
(c) be in the interests of international peace and security, […]"
"The regulations must contain provision which prohibits the Minister from designating a person by name except where the Minister—
(a) has reasonable grounds to suspect that that person is an involved person (see subsection (3)), and
(b) considers that the designation of that person is appropriate, having regard to—
(i) the purpose of the regulations asstated
under section 1(3), and
(ii) the likely significant effects of the designation on that person (as they appear to the Minister to be on the basis of the information that the Minister has)."
"23 Right to requestvariation
or revocation of designation
(1) At any time while a relevant designation has effect, the designated person may—
(a) request the Minister tovary
the designation, or
(b) request the Minister to revoke the designation. […]
(3) On a request under this section the Minister must decide whether tovary
or revoke the designation or to take no action with respect to it (but see section 22(3))."
"38 Court review of decisions
(1) This section applies to—
(a) any decision under section 23(3) or 24(2) (decision, following a request to or review by an appropriate Minister, on whether a designation of a person made under a designation power should bevaried
or revoked); […]
(2) The appropriate person may apply to the High Court or, in Scotland, the Court of Session, for the decision to be set aside.
(3) "The appropriate person" means—
(a) in relation to a decision within subsection (1)(a), the person named by the designation or, where the designation is of persons of a specified description, any person of that description; […]
(4) In determining whether the decision should be set aside, the court must apply the principles applicable on an application for judicial review.
(5) If the court decides that a decision should be set aside it may make any such order, or give any such relief, as could in the absence of this section be made or given in proceedings for judicial review of the decision; but this is subject to section 39(1) to (4). […]"
"Purposes
4. The regulations contained in this instrument that are made under section 1 of the Act are for the purposes of encouraging Russia to cease actions destabilising Ukraine or undermining or threatening the territorial integrity, sovereignty or independence of Ukraine."
"Designation criteria
6.— (1) TheSecretary
of
State
may not designate a person under regulation 5 (power to designate persons) unless the
Secretary
of
State—
(a) has reasonable grounds to suspect that that person is an involved person, and
(b) considers that the designation of that person is appropriate, having regard to—
(i) the purposesstated
in regulation 4 (purposes), and
(ii) the likely significant effects of the designation on that person (as they appear to theSecretary
of
State
to be on the basis of the information that the
Secretary
of
State
has).
(2) In this regulation, an "involved person" means a person who—
(a) is or has been involved in—
(i) destabilising Ukraine or undermining or threatening the territorial integrity, sovereignty or independence of Ukraine, or
(ii) obtaining a benefit from or supporting the Government of Russia,
(b) is owned or controlled directly or indirectly (within the meaning of regulation 7) by a person who is or has been so involved,
(c) is acting on behalf of or at the direction of a person who is or has been so involved, or
(d) is a member of, or associated with, a person who is or has been so involved. […]
(6) In paragraph (2)(d), being "associated with" a person includes—
(a) obtaining a financial benefit or other material benefit from that person;
(b) being an immediate family member of that person. […]"
1) It is a criminal offence for a person to deal with funds or economic resources owned, held or controlled by a designated person, if that person knows, or has reasonable cause to suspect, that they are so dealing: Regulation 11(1);
2) It is a criminal offence for a person to make funds or economic resources available directly or indirectly to a designated person, if that person knows, or has reasonable cause to suspect, that they are making the funds or economic resources so available: Regulations 12(1) and 14(1);
3) It is a criminal offence for a person to make funds or economic resources available to any other person for the benefit of a designated person, if that person knows, or has reasonable cause to suspect, that they are making the funds or economic resources so available: Regulations 13(1) and 15(1);
4) It is a criminal offence for a person to intentionally participate in activities knowing that the object or effect of them is (whether directly or indirectly) to circumvent any of the prohibitions above, or to enable or facilitate the contravention of any such prohibition: Regulation 19(1).
very
significant. The effect (in the context of another sanctions regime) was noted in Ahmed
v
HM Treasury [2010] 2 AC 534 [37-9].
THE AUTHORITIES
virtue
of s 38(4), on an application for review the court is required to apply "the principles applicable on an application for judicial review".
1) A review adopts administrative law concepts of lawfulness, reasonableness, and procedural fairness including: "whether the decision-maker has acted in a way in which no reasonable decision-maker could have acted, or whether he has taken into account some irrelevant matter or has disregarded something to which he should have given weight, or has erred on a point of law": R (Begum)
v
Special Immigration Appeals Commission [2021] AC 765;
2) Where a decision is taken which affects fundamental rights, an "anxious scrutiny" standard applies. While derided by Carnwath LJ as an uninformative expression, the important point is that the invocation of that standard "underlin[es] the
very
special human context in which such cases are brought" and requires "decisions to show by their reasoning that every factor which might tell in favour [of the person affected] has been properly taken into account": R (YH)
v
Secretary
of
State
for the Home Department [2010] 4 All ER 448, [24]; see also Begum [2023] HRLR 6 at [46-49] where it was elided with using a "more powerful microscope".
3) When considering whether a measure is compatible with the Convention, the Court must "determine that matter objectively on the basis of its own assessment": R (AAA (Syria))
v
Secretary
of
State
for the Home Department [2013] 1 WLR 4433 [38-41] (Lord Reed and Lord Lloyd-Jones); Begum at [69] (Lord Reed).
v
Secretary
of
State
for
Foreign,
Commonwealth
and
Development
Affairs
[2022] 1 WLR 2454 [68-102] Garnham J explained that the review mechanism in s 38 of SAMLA is the means by which the
State
guarantees the minimum threshold of access to a court required to render the scheme compatible with Articles 6 and 8 of the Convention.
via
such challenges In Youssef (at [61]) Garnham J concluded that it is implicit in the statutory scheme that "the [designated] person has no other resort to the courts" outside a s 38(1) review. A number of such challenges have now been brought. They include Dalston Projects Ltd
v
The
Secretary
of
State
for Transport [2023] EWHC 1885 (Admin) and the recent case of Graham William Phillips
v
Secretary
of
State
for
Foreign,
Commonwealth
and
Development
Affairs
[2024] EWHC 32 (Admin). LLC Synesis
v
Secretary
of
State
for
Foreign,
Commonwealth
and
Development
Affairs
[2023] EWHC 541 (Admin) was also a challenge concerning SAMLA and the 2019 Regulations but focussing on the grounds for designation and the meaning of "reasonable grounds to suspect".
v
Secretary
of
State
for
Foreign,
Commonwealth,
and
Development
Affairs
[2023] EWHC 2121 (Admin). The appeal in that case was heard the week before the hearing in this case. The Shvidler case is one which has numerous factual parallels with the present case, as well as some notable distinctions; all of which were explored in argument. It therefore repays careful consideration.
Khan,
a UK citizen, though a dual national - having been granted refugee status in the US in 1989 before gaining UK citizenship in 2004. Like Ms
Khan
he is
very
wealthy. Like Ms
Khan
he has children, including those who were in 2022 at prominent English private schools. Like Ms
Khan
he was sanctioned not because of his own actions or loyalties but rather because of his associations. His key association was a friendship and business involvement with Mr Roman Abramovich. His children had to be withdrawn from schools when the fees could not be paid after designation. Ms
Khan
has faced issues over fees and been unable to send her youngest son to the private school the others were attending. Both report considerable difficulties in dealing with OFSI leading to difficulties in paying bills relevant to properties here, and leading to making staff redundant.
Khan.
1) Mr Abramovich is of course a more prominent oligarch than Mr
Khan.
However Mr Abramovich is an oligarch not resident in Russia and who has not been seen to associate with Mr Putin since the invasion – but rather the reverse.
2) Mr Shvidler had an argument (albeit unsuccessful), that aside from association he had not received any financial benefit from Mr Abramovich; Ms
Khan
has no such argument, in that she has plainly received benefits from Mr
Khan.
3) Ms
Khan
has no business interests which are relevant (though she is plainly a knowledgeable collector of art and manages properties) and her association is financial only in the domestic sense; whereas Mr Shvidler is a businessman with
valuable
interests prior to designation in a sector of strategic significance (as noted by the terms of his designation).
4) Mr Shvidler had options which Ms
Khan
did not. As a US citizen he relocated his family there. Ms
Khan
has remained in the UK, where she has suffered, as the facts explain, numerous significant difficulties. The evidence suggests that the effect on her and her family has been more extreme than that on Mr Shvidler and his family.
view".
Neither of these points was contentious before me, though issues are taken as to aspects of the scheme.
Secretary
of
State
in reviewing the proportionality analysis, citing R (Lord Carlile of Berriew)
v
Secretary
of
State
for the Home Department [2015] AC 945 at §§30, 34; and R (Al Rawi)
v
Secretary
of
State
for
Foreign
and
Commonwealth
Affairs
[2008] QB 29 at [149]. The issue which he highlighted and which I also highlighted in oral argument was the issue created by the fact that some elements of the proportionality analysis are ones on which deference or "special weight" should be afforded to the executive's judgment, whereas others are not.
"[91] Undoubtedly, this is a case where close scrutiny is necessary in order to adjudicate on a complaint that Convention rights have been infringed. And it is the structured analysis articulated in Bank Mellat that must be applied. But the court does not assume the role of primary decision maker on issues that turn on the exercise of judgment or the determination of policy, limiting itself instead to asking whether the decision was one properly open to the executive. It will recognize the constitutional competence of theSecretary
of
State
and his officials on matters of
foreign
![]()
affairs,
attaching particular weight to the judgments of a primary decision-maker with special institutional competence who has considered all the relevant material.
[92] Applying that approach, the Court must consider closely the particular question that falls for decision so as to gauge the extent to which it should defer to the expertise of theSecretary
of
State
and the extent to which it can itself form a judgment. In my
view,
the question as to how far the evidence relied upon by the
Secretary
of
State
supports the contention that the Claimant's designation could contribute to achieving that objective (Limb 2 of Bank Mellat) is not entirely a question of United Kingdom
foreign
policy on which the Court is unqualified to form a
view,
nor is it a subject on which the Court should necessarily be slow to interfere on grounds of institutional competence. The
Secretary
of
State
is the primary decision-maker under the statute but the Court is well placed to judge the reasonableness of his analysis. The other limbs of Bank Mellat require a similar approach."
"Furthermore, in my judgment, the likelihood of one oligarch influencing the behaviour of another is one of those areas of decision making where theSecretary
of
State
is better able to assess the evidence than is the court. In this regard the discussion of the role of oligarchs in the Russian political economy in Mr Abramovich's SDF is instructive…. I accept that the identification of levers of pressure by which to influence the Government of Russia's decision- making, and the weight to be attached to different potential courses of action, is a matter of
foreign
policy in respect of which the
Secretary
of
State
has institutional expertise and is entitled to considerable respect."
state."
Considering this and other factors he concluded that there was a rational connection.
Secretary
of
State
and that that response was not self-evidently irrational or outside the range of reasonable responses.
stated:
"In myview,
it cannot properly be said that the
Secretary
of
State
has failed to strike a fair balance between the rights of Mr Shvidler and his family and the interests of the community."
THE FACTS
Khan
was born on 23 June 1971 in Almaty, then part of the USSR, now part of Kazakhstan. She studied at university in Kazakhstan moving to Moscow in 1991.
Khan
met Mr
Khan
in August 1992. They married in December 1994 and have four children together, with the three youngest being British citizens ordinarily resident in the UK. Two of the children remain dependents.
Khan
moved from Russia to the UK in 2013 and has lived in London since then. She became a British citizen on 29 October 2019 and spends most of her time in the UK. She previously travelled to Moscow around twice per year, for one week at a time.
Khan
stopped working when her first child was born in 1995 and has not been employed since. She describes herself as having primary responsibility for the care and supervision of the couple's children, management of the family home in London, and managing her other properties. She is also a noted art collector, with a collection which demonstrates her expertise. She has limited economic and business activities in Russia.
Khan
describes herself as financially autonomous. Having said that, the reality is that the main source of her wealth is through personal gifts from Mr
Khan
throughout their marriage. As noted in the introduction Mr
Khan
has given her many significant gifts –
valuable
properties here and abroad, and cash gifts totalling some hundreds of millions of pounds over the years. Some of these were to cover the running of the household and properties. Some were to cover specific items, such as purchases of
valuable
artworks. The largest and most recent gift was the March Gift, shortly before Mr
Khan
was designated and subject to an asset freeze - and with the risk of that event being the motive force. Some of these gifts were made unprompted by Mr
Khan,
others at Ms
Khan's
request.
Khan
states
that she and Mr
Khan
"lead independent lives". She explained that they do not possess joint bank accounts, nor do they access or otherwise use each other's bank accounts. They spend a significant amount of time apart and have different social circles. Ms
Khan
says that they have been apart far more than most married couples to the extent that they have led largely separate lives for some years; but they remain together, enjoy spending time together and plainly have much affection for each other. Ms
Khan
has gone to considerable trouble since her designation to fly to Russia to
visit
her husband when he was unwell and in hospital. They agree that they and the children are one family.
Circumstances of designation
Khan
family had many friends and acquaintances in Ukraine and had funded an orphanage in Irpin. After the Russian invasion and before her own designation Ms
Khan
and her adult daughter both welcomed Ukrainian refugees into their houses.
Khan
was designated in March 2022.
Khan's
designation were as follows:
1) At 17:29 on 20 April 2022, the "Sanctions Taskforce" submitted a decision memorandum to a Minister of
State
in the
Foreign,
Commonwealth
and
Development
Office ("FCDO") proposing the designation of seven individuals pursuant to the 2019 Regulations, including Ms
Khan;
2) At 18:11 on 20 April 2022, 42 minutes later, the Assistant Private
Secretary
to the Minister responded to
state
that the Minister "reviewed and agreed with the recommendation to designate all the listed individuals";
3) At 08:20 on 21 April 2022, the Sanctions Taskforce emailed the relevant decision-maker, a FCDO official acting as the
Secretary
of
State
under the Carltona principle, the Sanctions Designation Form ("the 2022 SDF") and the Sanctions Designation Form Evidence Pack ("SDFE"). These documents are 13 and 43 pages respectively. The SDF provides further information as to the basis of Ms
Khan's
designation, with the SDFE containing supporting evidence;
4) At 08:23 on 21 April 2022, three minutes later, the relevant decision-making FCDO official
stated
that they had "reviewed the attached spreadsheet, Sanctions Designation Forms and Sanctions Designation Forms (Evidence)" and "decided that the designations satisfy the applicable legal tests".
Khan
was designated by the
Secretary
of
State.
The
Statement
of Reasons explains that:
"There are reasonable grounds to suspect that AnzhelikaKHAN
is associated with German Borisovich
KHAN.
Anzhelika
KHAN
is the wife of German Borisovich
KHAN.
![]()
German BorisovichKHAN,
hereafter
KHAN,
is a prominent Russian businessman.
KHAN
is obtaining a benefit from and/or supporting the Government of Russia through his positions on the Supervisory Board of the Alfa Group Consortium and the Board of Directors of ABH Holdings S.A., owner of Russia's largest privately owned bank 'Alfa-Bank (Russia)', and Chairman of the Supervisory Board of A1 Investment Holding S. A., entities which are carrying on business in sectors of strategic significance to the Government of Russia.
KHAN
is also a close associate of
Vladimir
Putin who has been involved in destabilising Ukraine or undermining or threatening the territorial integrity, sovereignty or independence of Ukraine."
Khan's
behalf at that time, with a copy of the SDF and SDFE in relation to her designation.
Khan
requested the revocation of her designation by way of Ministerial review under s.23(1)(b) SAMLA.
Khan's
request. This involved officials from the FCDO's Sanctions Directorate, Eastern Europe and Central Asia Directorate, and Legal Directorate, who reviewed the evidence provided by Ms
Khan
and the FCDO's evidence. An Administrative Review Form ("ARF") was prepared, which sets out the details of the application, the grounds on which Ms
Khan
requested revocation of her designation, the FCDO's responses to her arguments, and officials' recommendations on the FCDO response to the request.
Khan
sent a Letter Before Claim to the FCDO alleging an unlawful failure to determine her review request "as soon as reasonably practicable".
Khan's
Letter Before Claim, indicating that a response would be received to her delisting request by 29 February 2023.
1) On 21 February 2023, a "case closing meeting" was held involving the relevant FCDO officials, where it was agreed that Ms
Khan's
designation would be maintained. The SDF and SDFE were updated to reflect the additional evidence and to address the arguments made by Ms
Khan;
2) On 23 February 2023, a submission was sent to a Minister in the FCDO recommending that the designation be
varied;
3) On 27 February 2023, the Minister endorsed the recommendations;
4) On 28 February 2023, a further submission was sent to the Minister clarifying the application of transport sanctions to Ms
Khan,
which the Minister also endorsed;
5) At 14:02 on 28 February 2023, the case was presented to a FCDO official for final decision on behalf of the
Secretary
of
State.
The relevant email attached Ms
Khan's
Sanctions Review Request Form, the ARF, the updated SDF ("the 2023 SDF"), and the updated SDFE. The updated SDF reflects a consideration in particular of the personal effects on Ms
Khan
and her family;
6) At 14:25 on 28 February 2023, 23 minutes later, the official took the final decision maintaining Ms
Khan's
designation.
Khan
had attended a meeting at the Kremlin hosted by Mr Putin. In that meeting Mr
Khan
and other attendees (many of them designated by the UK sanctions regime) were urged to invest assets in Russia's economy to mitigate the effect of Western sanctions.
Khan's
designation was
varied
to impose a trust services sanction, and Ms
Khan
was notified of this change by the FCDO on 23 March 2023.
Khan
issued a claim in this Court requesting a review of her designation under s.38(2) SAMLA.
Consequences of designation
Secretary
of
State
that Ms
Khan's
designation has caused significant difficulty and disruption to Ms
Khan's
life and that of her children.
Khan
and some of her children have suffered and currently do suffer serious physical and/or mental health issues necessitating medical treatment. Some of the issues affecting her children are a consequence of her designation. Ms
Khan's
designation has also resulted in the cancellation of private health insurance and delays in receiving medical care. Ms
Khan
has, since her designation, received medical care from the NHS. She has also successfully applied for Office of Financial Sanctions Implementation ("OFSI") licences to pay for a child's private medical care.
Khan's
youngest child's schooling has also been affected. His application to study at a well known private senior school was paused. While OFSI initially granted licences to pay for his existing private school fees, it decided that no further payments would be licensed after July 2023, with the result that he had to move schools and into the
state
system.
Khan
has been left with so little money that she has been unable to do the grocery shopping to feed her family. There can be no doubt at all that the effects on Ms
Khan
and her children have been significant and grave.
THE ISSUES AND SUBMISSIONS
Ms
Khan's
Arguments
Khan
advances similar proportionality arguments to those advanced by Mr Shvidler. However she also runs three different arguments. The first is her first ground: that the
Secretary
of
State
failed to consider whether her individual designation (as opposed to designations in general) would (or as Ms Montgomery KC put it, was likely to) further the statutory purpose of encouraging Russia to cease actions destabilising Ukraine or undermining or threatening the territorial integrity, sovereignty or independence of Ukraine.
Khan
submits that this failure meant that the
Secretary
of
State
failed to comply with the Padfield principle that his statutory discretion must be exercised so as to promote the policy and objects of the statute by which the discretion is conferred. It also follows that the
Secretary
of
State
failed to have regard to a mandatory consideration. On Ms
Khan's
view,
taking her personal circumstances into account renders the decision to designate her unreasonable.
Khan
argues that the
Secretary
of
State's
discretion to designate involved persons under the 2019 Regulations is so broad and lacking in guidance as to not constitute a lawful discretion at all. Once the
Secretary
of
State
"has reasonable grounds to suspect that [a] person is an involved person", whether a given person will be designated is entirely unforeseeable and possibly arbitrary. She submits that the safeguards contained in ss. 23 and 38 SAMLA are inadequate.
Khan's
case is that her position is different to that of Mr Shvidler with the consequence that the interference with her rights under Article 8 and A1P1 ECHR as a result of her designation is disproportionate:
1) It is said that, given Ms
Khan's
personal circumstances, in particular her lack of influence on the Russian government, there is no rational connection between her designation and furthering the statutory purpose. The methods by which the
Secretary
of
State
suggests she might indirectly put pressure on the Russian government are unevidenced and implausible;
2) In the round, Ms
Khan
submits that the
Secretary
of
State
failed to consider the severe consequences of designation for her and her family which, if properly taken into account on the "fair balance" test, necessarily leads to the conclusion that her designation is disproportionate. This is because the public interest in her designation is particularly weak, the interests of her children have been significantly harmed, and the purported mitigation of adverse consequences through the OFSI licensing regime is more apparent than real.
The
Secretary
of
State's
Arguments
Khan's
designation upon her and her family, the
Secretary
of
State
argued that in exercising his discretion to designate, he was entitled to assume that the regime was working properly. As provided by Regulation 64 of the 2019 Regulations, the licensing regime falls under the purview of the Treasury. As such, any challenge to that regime should, it is said, properly be brought against the Treasury and not in these proceedings.
Secretary
of
State
argued that both the 2022 and 2023 SDFs show that the
Secretary
of
State
specifically considered whether the statutory purpose would be furthered by designating Ms
Khan
and concluded that it did. Since this is a paradigm matter of
foreign
policy, the
Secretary
of
State's
judgment is entitled to great respect and the court should be
very
slow to interfere.
Secretary
of
State
contended that given the accepted connection there is plainly a rational connection between sanctioning Ms
Khan
and furthering the statutory objective, particularly through Ms
Khan
exercising influence over Mr
Khan,
who in turn could put pressure on Mr Putin. As to fair balance given the importance of the objective and the availability of mitigations in the form of OFI licences and court challenge there was no real scope to conclude the balance was not fair.
various
grounds of challenge, I will take first the arguments which fall outside the "standard" proportionality challenge.
GROUND 1: FAILURE TO CONSIDER MS
KHAN'S
INDIVIDUAL POSITION
Secretary
of
State
failed to consider whether the individual designation of Ms
Khan
was likely to further the statutory purpose of (inter alia) dissuading the Government of Russia from destabilising Ukraine and in so doing, the
Secretary
of
State:
(i) acted in a manner which was ultra
vires
the 2019 Regulations (on the basis of the Padfield principle) and/or (ii) failed to have regard to a mandatory relevant consideration; and/or (iii) acted unreasonably.
Secretary
of
State
was required to comply with the so-called "Padfield principle": that a statutory discretion must be exercised so as to promote the policy and objects of the statute by which the discretion is conferred: Padfield
v
Minister of Agriculture, Fisheries & Food [1968] AC 997, 1030 (Lord Reid).
Secretary
of
State
was required to have regard to all mandatory relevant considerations. Those include: (1) matters expressly or impliedly prescribed by statute as a mandatory relevant consideration; (2) matters which are a mandatory relevant consideration by reason that they are "so obviously material" to the decision at issue (see, e.g., R (Friends of the Earth Ltd)
v
Heathrow Airport Limited [2021] 2 All ER 967 at [119] (Lord Hodge and Lord Sales); and (3) matters the relevance of which is within the evaluative judgment of the decision-maker, but where (on the facts of a given case) it was irrational / unreasonable for the decision-maker to fail to have regard to them.
Secretary
of
State
to designate an individual, where the designation criteria are satisfied and the purpose for which that statutory discretion is exercised is that set out in Regulation 4 of the 2019 Regulation: "encouraging Russia to cease actions destabilising Ukraine or undermining or threatening the territorial integrity, sovereignty or independence of Ukraine".
Khan's
argument which was at times couched in terms of it being "incumbent on the
Secretary
of
State
to consider whether it was appropriate" to designate Ms
Khan.
That is because when one looks at the wording of the Regulation, as outlined above it has actually explicitly moved away from a requirement of a consideration of "appropriateness". The amendment effected by s 61(3) of the 2022 Act removed the requirement that the
Secretary
of
State
must consider designation to be "appropriate". The problem for Ms
Khan
is that
viewed
through this prism it becomes clear that the nature of the argument is effectively to say that there needs to be (aside from and in addition to a proportionality assessment) an unspecified individualised consideration of whether to designate a particular person, by reference to something different to proportionality and which it is most natural to designate appropriateness. This does not shut off the possibility of her argument being correct – but it highlights the difficulty of definition which lies within it.
Secretary
of
State
had considered Ms
Khan's
case in any individualised way in terms of what sanctioning her was likely to contribute to the overall aim, no reasonable
Secretary
of
State
could have concluded that it was appropriate to sanction Ms
Khan.
Secretary
of
State
is said to have erred by not considering in a detailed fashion such questions as the likely efficacy of any designation in circumstances where:
1) Ms
Khan
has never engaged in any conduct which has the effect of destabilising Ukraine, or of undermining or threatening the territorial integrity, sovereignty, or independence of Ukraine;
2) Ms
Khan
is not in a position, whether directly or indirectly, to influence the policy of the Government of Russia, nor to influence the conflict in Ukraine. Ms
Khan
is not an individual who wields political power or influence. In short, applying "pressure" to Ms
Khan
cannot rationally be expected to result in consequent "pressure" being brought to bear upon the Government of Russia;
3) Ms
Khan
has limited personal connections to Russia, and only limited economic and business activities in Russia. Ms
Khan
is a British citizen, who spends the overwhelming majority of her time in the United Kingdom;
4) Ms
Khan
is only capable of being sanctioned because of her association with Mr
Khan,
against whom the sanctions case is said to be itself weak and based on a rather speculative case as to influence;
5) A case for applying "pressure"
via
Ms
Khan
via
Mr
Khan
upon the Government of Russia, is defective where Ms
Khan
and Mr
Khan
lead relatively independent lives. Ms
Khan
can hardly be expected to exert influence over the political and business decision-making of her husband;
6) There is no basis to suggest that designation of Ms
Khan
would be likely to financially impact upon Mr
Khan.
Khan
cannot rationally be expected to result in consequent "pressure" being brought to bear upon the Government of Russia. It is said to be simply inconceivable that the designation of Ms
Khan,
an individual wholly remote from Russian politics, the Russian government, and Russian
foreign
policy (and the conflict in Ukraine), sends any message whatsoever to the Government of Russia and/or the international community or incentivises the Government of Russia to change its behaviour. It is suggested that the absence of nuanced consideration of such matters is evident from the timeline of the decision-making, as such a careful analysis could not have been performed in the time during which the decision was being actively considered.
Secretary
of
State
by Regulation 5 of the 2019 Regulations may only be exercised where to do so furthers the purposes of "encouraging Russia to cease actions destabilising Ukraine or undermining or threatening the territorial integrity, sovereignty or independence of Ukraine"; and consequently it is a mandatory relevant consideration for the
Secretary
of
State
to consider whether the exercise of the Regulation 5 discretion furthers the purposes of "encouraging Russia to cease actions destabilising Ukraine or undermining or threatening the territorial integrity, sovereignty or independence of Ukraine".
Khan
seeks to put on it). It is a fact-sensitive exercise and to that extent individual, but it is not a granular evaluation of likelihood requiring nuanced evaluation of the kinds of facts sought to be brought into play here.
Secretary
of
State
has reasonable grounds to believe that Ms
Khan
is an "involved person" and that she therefore satisfies the designation criteria in the 2019 Regulations. There is no evidence which makes her inapt to serve the purpose. Padfield does not say anything about individualised consideration, it speaks only to purpose. As indicated above, the purpose and the means whereby that purpose is to be achieved (including by designation of associated individuals) has been set out by statute.
Khan
says that the first point to be considered is whether the
Secretary
of
State
did conduct any individual consideration as to whether the designation of Ms
Khan
would, or "was likely to", advance the purposes set out in Regulation 4 of the 2019 Regulations,
viz.
"encouraging Russia to cease actions destabilising Ukraine or undermining or threatening the territorial integrity, sovereignty or independence of Ukraine"? Ms
Khan
says he did not and that on the basis of the contemporaneous materials (as opposed to Mr Reed's later explanations, which were contended not to be admissible for the purposes of this question) the question was approached generically. But this effectively assumes an answer to the main question – that the link between the individual and the likelihood needs to be a close one requiring (as Ms
Khan
submits) a nuanced inquiry which goes beyond the aims of message sending, incentivizing etc.
Khan's
position, Mr
Khan's
position and the relation between the two which leads to a (uncontentious) conclusion that Ms
Khan
meets the definition of an "involved person". There is then, in the ECHR section of the form, a consideration of the contribution to the statutory purpose. Reasons are given.
Khan's
designation links to, and is capable of serving the statutory purpose in the ways identified, namely by:
1) Sending a signal to Ms
Khan
and
via
her to the Government of Russia and the international community (and thus logically to others in her position (i.e. persons who are associated with involved persons)) that the UK does not accept acts which destabilise the Ukraine or undermine or threaten the territorial integrity, sovereignty and independence of Ukraine;
2) Incentivising (indirectly)
via
undermining the operation of the entities carrying on business in a sector of strategic significance to the Government of Russia which Mr
Khan
owns and those in which he holds positions, the Government of Russia to change its behaviour, and to cease those such acts in connection with Ukraine;
3) Signalling the UK's support for the full implementation of Russia's international obligations and commitments, that there are negative consequences to associating oneself with (and to that extent legitimising the conduct of) persons involved in obtaining a benefit or supporting the Government of Russia;
4) Constraining Mr
Khan's
ability to act - for example in relation to transporting assets.
Stated
thus and without the logical corollaries which only find real expression in Mr Reed's evidence, they may not be the strongest reasons in the world but it cannot be said (given the connection to Mr
Khan
made earlier in the document, the plain fact of involvement within the meaning of the regulations and the fact that Mr
Khan's
designation has never been challenged) that they do not show the necessary consideration being made to whether the prima facie position indicated by the satisfaction of the statutory criteria aligns with the facts. The same can be seen in the updated decision and the Administrative Review which closely consider whether Ms
Khan's
assets demonstrate a continuing association with Mr
Khan
so as to make sure that the designation criteria are properly engaged and aligned with reality.
Khan
engages in some detail with the distance between herself and the Putin regime. But even taken at face
value
those points only go so far:
1) Ms
Khan
is the wife of Mr
Khan
and she accepts that she is plainly "associated with" him under the 2019 Regulations.
2) Ms
Khan
accepts that she is the recipient of "significant gifts" from Mr
Khan
accepting for example that in early March 2022, shortly before Mr
Khan
was sanctioned, he gave Ms
Khan
the hugely
valuable
March Gift;
3) Mr
Khan
is at least to some extent an associate of President Putin;
4) Mr
Khan
is also in significant positions within entities which are carrying on business in sectors of strategic significance to the Government of Russia;
5) Mr
Khan
was designated on 15 March 2022. That designation has never been challenged. While he may not be the closest of Putin associates, there is no basis to suggest that the case for the designation of Mr
Khan
is weak.
Khan,
individually, can move the dial on the effectiveness of sanctions. But that argument is one which effectively runs contrary to the entire scheme of the sanctions regime which relies on indirect/levers of pressure, not individual efficacy. As Garnham J put it in Shvidler:
"effectiveness of any sanctions regime depends, not on the effect of a particular measures at a single individual, but on the cumulative effect of all the measures imposed under that regime, together with other types of diplomatic pressure"
A similar point was made by Sir Ross Cranston in Dalston Projects at [86], concluding, as I do, that the
Secretary
of
State
need not demonstrate the efficacy of each individual designation.
view
of "likely" which is not justified on the authorities. The Padfield principle is satisfied. Beyond that there still is a framework for the consideration of the individual's position. It is the proportionality test. There is no preliminary or more rigorous requirement.
Khan's
first argument also has a practical problem: as is apparent from the foregoing points of detail it is an argument which elides into the rational connection and fair balance elements of the proportionality assessment. It is indeed hard to see how any such requirement can be kept distinct from it. That reinforces the conclusion which I have already reached that this argument cannot succeed.
GROUND 2(A): EXCESSIVE BREADTH/UNFORESEEABILITY
Khan
constitutes a disproportionate interference with her rights, pursuant to Article 8 and A1-P1, ECHR. As noted above, part of this is a conventional proportionality argument similar to that in Shvidler. But there is the additional aspect – Ground 2(a). That contends that Ms
Khan's
designation is not "subject to … conditions provided for by law". This argument is that the 2019 Regulations do not meet the minimum threshold of lawfulness required by Article 8 and/or A1-P1.
1) The number of persons who may become "involved persons", and thereby liable to designation, is potentially
vast
when one considers not merely those directly or actively involved in destabilizing the Ukraine or obtaining a benefit from or providing support to the Government of Russia, but also those "associated with" such people;
2) Following the passage of the 2022 Act, there is now no explicit statutory control upon the exercise of the
Secretary
of
State's
discretion. That is, Regulation 5 simply
states
that the
Secretary
of
State
"may" designate a person who satisfies the criteria in Regulation 6;
3) The test is therefore "hopelessly broad", the application of the test is insufficiently foreseeable and the application is in effect dependent on the will of the
Secretary
of
State
with no safeguards against capricious and arbitrary abuse;
4) As such it lacks the necessary quality of law which requires that it should be accessible to the person concerned and foreseeable as to its effects: Catt
v
United Kingdom (2019) 69 EHRR 7 at [94]; R (Bridges)
v
Chief Constable of South Wales Police [2020] EWCA 9 [2015] AC 1065 at §(1) and (2);
5) It falls foul of the dictum of Lord Sumption in In re Gallagher [2020] AC 185 at [17] that the measure is "not in accordance with the law" where it "confer[s] a discretion so broad that its scope is in practice dependent on the will of those who apply it, rather than on the law itself" or "is couched in terms so
vague
or so general as to produce substantially the same effect in practice".
Secretary
of
State
was defective, but that Regulation 6 does not satisfy the test of legality. That would mean that every single designation under the 2019 Regulations has been unlawful. It would
very
likely have implications for SAMLA, since its structure mirrors the criteria in s. 11 SAMLA.
very
wide-ranging argument and one which requires thorough consideration, because as Lord Sumption noted in In re Gallagher at [14] there would be "far-reaching consequences" if the respondent's similar challenge were correct: "it means that the legislation is incompatible with article 8, however legitimate its purpose, and however necessary or proportionate it may be to deal with the problem in this particular way. That conclusion would plainly have significant implications for the protective functions of the
state".
"(1) The measure in question (a) must have 'some basis in domestic law' and (b) must be 'compatible with the rule of law', which means that it should comply with the twin requirements of 'accessibility' and 'foreseeability'.
(2) The legal basis must be 'accessible' to the person concerned, meaning that it must be published and comprehensible, and it must be possible to discover what its provisions are. The measure must also be 'foreseeable' meaning that it must be possible for a person to foresee its consequences for them and it should not 'confer a discretion so broad that its scope is in practice dependent on the will of those who apply it, rather than on the law itself'.
(3) Related to (2), the law must 'afford adequate legal protection against arbitrariness and accordingly indicate with sufficient clarity the scope of discretion conferred on the competent authorities and the manner of its exercise'.
(4) Where the impugned measure is a discretionary power, (a) what is not required is 'an over-rigid regime which does not contain the flexibility which is needed to avoid an unjustified interference with a fundamental right' and (b) what is required is that 'safeguards should be present in order to guard against overbroad discretion resulting in arbitrary, and thus disproportionate, interference with Convention rights'.
(5) The rules governing the scope and application of measures need not be statutory, provided that they operate within a framework of law and that there are effective means of enforcing them.
(6) The requirement for reasonable predictability does not mean that the law has to codify answers to every possible issue."
v
United Kingdom 69 EHRR 7, paragraph 94, quoted at (4) in Bridges: "it must afford adequate legal protection against arbitrariness and accordingly indicate with sufficient clarity the scope and discretion conferred on the competent authorities and the manner of its exercise."
Khan
submits, none of the similarly situated wives of men analogously placed to Mr
Khan
can be sure whether they will in fact be designated - they do know whether they are apt to be designated by reading the criteria. Indeed the fact that Ms
Khan
is not arguing that she is not an involved person speaks for the clarity, foreseeability and accessibility of the criteria. That itself means that the exercise is not open to being simply the will of the individual – the defined hurdles must be surmounted.
very
safeguard which Ms
Khan
invokes in her first argument and the remainder of the second argument. The exercise of the discretion is then subject to the common law – this covers both the stage of assessing whether the criteria are met and then assessing whether, if ECHR principles apply, the decision is proportionate. The exercise of discretion (conducted in accordance with well established rules of statutory construction and proportionality principles) provides a first safeguard against arbitrary or inappropriate invocation of the criteria and takes the situation well clear of the operation being "entirely dependent on the will of the executive". There is no need for specificity as to how the discretion will be operated where the common law safeguards are operated.
very
structure of the documentation evidencing the decision-making shows both that (i) the criteria are considered and applied by reference to evidence and (ii) the designation is not proceeded with without a consideration specifically of proportionality – again by reference to evidence.
Khan.
In Youssef at [91] Garnham J considered whether ss. 25 and 38 of SAMLA provided an effective remedy against arbitrariness. He concluded at [89] that they "comfortably reach the necessary standard".
v
Secretary
of
State
for
Foreign
and
Commonwealth
Affairs
[2024] EWHC 32 which also considered this question of whether these Regulations failed the "prescribed by law" test. He concluded at [144] that "there are strong safeguards against arbitrariness", taking the points already noted - and in addition highlighting the facts that the 2019 Regulations were subject to the affirmative procedure, and, for the first 3 years of their operation, the
Secretary
of
State
was required to provide annual reports to Parliament on their operation under section 30 of SAMLA.
GROUND 3: REGULATION 6(2)(D)
Very
possibly also, given the derivation of SAMLA (see Mints at [10] noting its purpose to restate UN and EU sanctions regimes following Brexit), it obliquely also challenges such wider sanctions regimes.
Khan
submits that the breadth of the "associated with" wording which in practical terms, renders every immediate family member of an "involved person" liable to designation whether or not: (i) the individual has any involvement whatsoever in the financial or political
affairs
of the "involved person"; (ii) the individual has ever obtained any financial or material benefit from the "involved person"; or (iii) the individual has ever had any role in undermining or threatening the territorial integrity, is offensive as being "[in]capable of being operated in a manner which is compatible with Convention rights", citing Christian Institute
v
Lord Advocate [2016] UKSC 51 and In re Abortion Services (Safe Access Zones) (Northern Ireland) Bill [2023] AC 505 at [19].
"This court has explained that an ab ante challenge to thevalidity
of legislation on the basis of a lack of proportionality faces a high hurdle: if a legislative provision is capable of being operated in a manner which is compatible with Convention rights in that it will not give rise to an unjustified interference with article 8 rights in all or most cases, the legislation itself will not be incompatible with Convention."
The Christian Institute approach was approved and applied, and a challenge to it dismissed, by the Supreme Court in In re Abortion Services (Safe Access Zones) (Northern Ireland) Bill, per Lord Reed at [19].
GROUND 2(B): PROPORTIONALITY (RATIONAL CONNECTION)
Khan
submits that it is clear that her designation pursuant to the 2019 Regulations constitutes a disproportionate interference with her rights pursuant to Article 8 and/or A1-P1, ECHR, pointing to the
various
different ways in which Ms
Khan's
rights are impacted – in particular the financial and reputational impacts.
Khan:
1) Disincentivising Ms
Khan
from continuing to obtain a financial or other material benefit from her husband;
2) Encouraging Ms
Khan
to put pressure on her husband to use influence that he may have with President Putin and senior decision makers within Russia to change its behaviour towards Ukraine and to incentivise him to distance himself from President Putin;
3) Reducing the risk that Mr
Khan
could mitigate the impact of his designation by moving assets into Ms
Khan's
name; and
4) Incentivising others to disassociate themselves in future with individuals who carry on business in sectors of strategic significance to the Government of Russia.
Khan's
arguments to prevail on this basis, because one then enters into the territory described in Shvidler (at [116]), the "identification of levers of pressure by which to influence the Government of Russia's decision-making, and the weight to be attached to different potential courses of action, is a matter of
foreign
policy in respect of which the
Secretary
of
State
has institutional expertise and is entitled to considerable respect".
very
obviously affection may incentivise influence or advocacy beyond that which the primary target might adopt on their own behalf.
Khan
and his influence on Mr Putin, this "levers" argument based on the fuller evidence provides a more than rational connection. The objectives of Ms
Khan's
designation identified in Mr Reed's evidence reflects the
Secretary
of
State's
expert assessment of the available mechanisms by which to influence the Government of Russia's decision-making in relation to Ukraine, which approach underpins the structure of the sanctions regime and the inclusion of persons "associated with".
Khan
is in Russia and is overtly called on by Mr Putin and (ii) Ms
Khan
is the mother and custodian of Mr
Khan's
children (including his minor children) and Ms
Khan
and Mr
Khan,
while living separately, remain close – as is evidenced by Ms
Khan's
considerable efforts to pay a
visit
to Mr
Khan
in hospital.
"As a matter of common experience, an individual may more readily act when it is at the request, or in the interests, of his friends and colleagues than when it is only in his own interests. In any event, the availability of a more direct means of putting pressure on Mr Abramovich does not undermine thevalue
of additional pressure provided by the Claimant."
The position here is a fortiori: if an individual may more readily act in the interests of friends and colleagues, how much more readily will he act in the interests of sparing trouble to his own young children?
foreign
policy objectives. Designations under the 2019 Regulations are "are one element of a broader strategy to achieve the UK's
foreign
policy goals to change the Russian Government's policy towards Ukraine". Once this is taken into account the argument as to rational connection cannot survive.
GROUND 2(C) PROPORTIONALITY (FAIR BALANCE)
v
SSWP [2019] EWCA Civ 615 [2019] 1 WLR 5687 at [84]. This core of the exercise is emphasised in other authorities such as AXA General Insurance
v
Lord Advocate [2012] 1 AC 868 at [36], R (International Transport Roth GmbH)
v
SSHD [2003] QB 728 at [52].
Khan
and her family which she contends are precisely the kind of "drastic", "oppressive", "devastating" impacts described by the Supreme Court in Ahmed
v
HM Treasury [2010] 2 AC 534.
Khan,
and entirely apt to engage considerable sympathy, once the designation criteria are met, and the importance of the objective of designation is accepted, this is a
very
hard point for her to meet.
Secretary
of
State
(to whom in this context considerable deference is due) is clear that no less intrusive measures would be equally effective. This is entirely comprehensible against the backdrop of the objective being sought to be achieved and the kind of strategy in operation.
vis
a
vis
Mr
Khan
it cannot be said that the
Secretary
of
State
was wrong to conclude that no less intrusive measures would suffice and that less intrusive measures would compromise the objective which lies at the heart of the sanctions regime.
very
heavy weight indeed. That seeks to achieve an aim of
very
great importance, benefitting many people. It is a weight which cannot be made less by use of less intrusive measures. That weight then has to be balanced against the
very
considerable negative impacts on Ms
Khan,
who is subject to designation - and also her family, including her dependent children, who are not designated but are nonetheless impacted as if they were.
Khan
herself was not in robust health at the time of the designation or since, and how she has been deeply affected by the significant changes made to her life by the designation. Particular emphasis was put on the position of the children – particularly the youngest – aged just ten at the time of designation. One of the older children has a long standing mental health issue for which continuity of care was significant, but lost. The youngest child, aside from having to change school, has suffered a considerable downturn in mental health, expressing suicidal ideas prompted by the loss of so much of the secure routine which is so important in childhood. Ms Montgomery KC put it thus: "the evidence is clear and should have been clear that their serious mental health condition was entirely associated with the sanctions regime which has resulted in them being deprived of the only environment which they knew and were comfortable."
Khan's
children retain her loving presence, but at least one has been forced to change from private to
State
school in the UK.
Khan
may have dependents upon whom this designation may have an impact").
Khan
to pay for travel, security staff and sports activities as well as basic needs and education. The conclusion reached was that "we consider that the impact of designation upon Ms
Khan
and her children can be mitigated to a sufficient degree to render the designation proportionate given the importance of the objectives being pursued."
Khan's
arguments from the
Secretary
of
State
focussed heavily on those ameliorations. It was submitted that, as the second decision made clear, the licensing system was available to and used by the
Khan
family. But, it was emphasised, it is no part of sanctions licensing system to remove all impact; to the contrary without impact there is no effect. It was submitted that there are mitigations and overall the decision was, in the context of the overall regime, not just proportionate but plainly proportionate overall.
Khan
would strongly dispute the licence regime as an amelioration, with Ms Montgomery KC describing that
statement
as "an assault upon the English language" in the light of the lived reality of dealing with the OFSI process and its sometimes Kafkaesque manifestations. She took me through a lengthy and tortuous set of exchanges where weeks of chasers were needed before a licence was issued to enable Ms
Khan
to
visit
her sick mother and her hospitalised husband. She submits that by February 2023 – the time of the review decision – it should have been crystal clear that OFSI was not a mechanism which provided any comfort at all.
very
clear to me - that the decision taken does not fall foul of the fair balance test.
very
different considerations. On one side of the balance a considerable respect needs to be given to the
Secretary
of
State's
assessment; and what is being said is that the purpose is of the highest importance, indicating a
very
heavy weight. As was said in argument, it is a highest
foreign
policy imperative and therefore is about as heavy a weight as it can be. One can entirely understand that submission bearing in mind that the ultimate, avowedly indirect target for the communication made by the imposition of sanctions, is not Ms
Khan
or even Mr
Khan
– it goes wider to all those who might help or influence Mr Putin and to Mr Putin himself. On the other side are the personal, individual and emotive effects; the individual, concrete and real misery and suffering of an identified small family.
Khan,
that what is required is to "make a judgment about the level of human misery which may be regarded as being permissibly outweighed by the benefits of Ms
Khan's
sanctioning". Understandably the argument for Ms
Khan
focusses too closely on the domestic and individual perspective. The balance does not focus on benefits of Ms
Khan's
sanctioning, but (Ms
Khan's
sanctioning being ex hypothesi within the rules and in furtherance of the requisite purpose) on the benefits of the sanctions regime of which her designation is an indivisible part. It is that wider perspective which results in the heavy weight on the side which favours the
Secretary
of
State's
decision.
Secretary
of
State's
approach, always result in an answer in favour of sanctions. If that were the case it would suggest that the
Secretary
of
State's
argument undermines the proportionality safeguard to
vanishing
point and must be at fault. But posed in this way one can readily see that the answer is no, and that the mitigations (such as they are) are genuinely critical to the argument. Suppose, for example, sanctions deprived a designated person of assets without any exceptions and also of access to healthcare – if designation meant "un-personing" the subject. The result would be to inflict on the subject not just
very
considerable trouble, distress and inconvenience but logically starvation, physical suffering and ultimately death. This is a balance which one cannot imagine could be found to be fair.
Khan
family have been able to access healthcare, just as other citizens of this country can; and they have derived benefit from that access. The children continue to receive education. While there is no doubt from the correspondence I have seen and from more general information that OFSI, perhaps more burdened than was originally anticipated, does not operate at high speed or without asking awkward questions, it is there, and it does, on the evidence, provide assistance. Ms
Khan
and her family had, at the time the evidence was finalised, been granted no fewer than 18 specific licences. These have included licenses for private healthcare, six licenses for return flights to overseas destinations (generally to see Mr
Khan),
private school fees, staff salaries and redundancy pay to former staff members.
Khan
(and that will be even more true for her children, for whom this period is a greater proportion of their conscious life) the sanctions are designed as temporary both in intent and in operation (i.e. there is an asset freeze not an asset seize and use). It is contemplated that they will cease.
Secretary
of
State
has not failed to strike a fair balance between the rights of Ms
Khan
and her family and the interests of the community.
Note 1 There was a secondary argument that the discretion had been exercised in a discriminatory manner. [Back] Note 2 “The designation of Anzhelika
KHAN is likely to contribute to achieving the purposes of the sanctions regime …” [Back]