INSERT INTO `tm_wsal_metadata` (`id`, `occurrence_id`, `name`, `value`) VALUES
(260751, 25296, 'MetaValueOld', '<p dir=\"LTR\" align=\"LEFT\"><img class=\"size-full wp-image-8044 alignnone\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/cvdfd.jpg\" alt=\"\" width=\"6000\" height=\"2401\" /></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Bahrain’s Law on the Protection of Personal Data was published on 19 July 2018, and will come into effect on 1 August 2019. The Law will require a variety of changes to the way businesses process personal data in Bahrain or about residents of Bahrain. Data protection has not been a high priority topic for most businesses in Bahrain, with the limited exception of international entities subject to data protection requirements in other jurisdictions in which they operate. While the publication of the new Law provides a considerable lead-in period within which entities subject to the Law will need to comply, the fact that the Law creates criminal offences means that compliance is all the more important and should be treated as a high priority.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Until now, and with one exception (namely, Qatar), none of the Gulf Cooperation Council member states had a modern, nationally applicable data protection law. Legal issues relating to privacy and data protection are typically analysed in terms of general, and ill-fitting, criminal provisions relating to the unauthorized disclosure of secrets, or – in appropriate circumstances - industry-specific obligations relating to healthcare or credit data, or telecommunications sector subscriber data.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law is generally composed of 60 articles divided into three broad sections or ‘titles’. These are:</p>\r\n\r\n<ul>\r\n 	<li dir=\"LTR\">Title 1: Processing Provisions – Including definitions and general rules for the legality of processing, controls of data processing and transfer, statements as well as the rights of the data holder.</li>\r\n 	<li dir=\"LTR\">Title 2: Data Protection Authority - Including provisions relating to the establishment of the regulator, and its rights and responsibilities.</li>\r\n 	<li dir=\"LTR\">Title 3: Accountability of the data manager (data controller) and data processor – Including provisions relating to accountability to the regulator, investigation procedures, civil and criminal liability, and penalties for violation.</li>\r\n</ul>\r\n<p dir=\"LTR\" align=\"LEFT\">In this article, we consider some key areas addressed in the Data Protection Law.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Application</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Bahrain’s Data Protection Law describes the legal protection of personal privacy as among the main constitutional rights of the person, and notes that it should be protected, particularly in the context of the increasing use of electronic/digital means for processing information.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law applies to:</p>\r\n\r\n<ul>\r\n 	<li dir=\"LTR\">Every individual residing normally in Bahrain or having a workplace in Bahrain, and every legal person (corporate) having a place of business in the Kingdom of Bahrain; and</li>\r\n 	<li dir=\"LTR\">Every individual not residing normally in Bahrain or having a workplace in Bahrain, and every legal person (corporate) not having a place of business in the Kingdom of Bahrain, where such persons are processing data using means available in Bahrain, except where such processing means are solely for the purpose of passing data through Bahrain.</li>\r\n</ul>\r\n<p dir=\"LTR\" align=\"LEFT\">In this latter scenario, the legal person (corporate) is required to appoint an authorized representative in Bahrain, and notify the Authority of such appointment. This provision would appear to affect, for example, corporate customers of cloud service providers, where the customer is based outside Bahrain, and the services being provided to the customer are being provided from data centres located in Bahrain.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Criminal provisions</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law criminalizes a variety of acts that would, at most, be the subject of administrative penalties in data protection laws elsewhere. Penalties generally comprise up to one year in prison and/or a fine of between BHD1,000 and BHD20,000 (between about USD 2,600 to about USD 53,000) (or a fine only in the case of corporate entities). The following are examples of activities that attract criminal penalties under the Law:</p>\r\n\r\n<ul>\r\n 	<li dir=\"LTR\">processing sensitive personal data in violation of the provision specifying requirements for processing sensitive personal data;</li>\r\n 	<li dir=\"LTR\">transferring personal data outside Bahrain contrary to the provisions specifying requirements for transfers to jurisdictions that provide an adequate level of data protection, and associated exceptions;</li>\r\n 	<li dir=\"LTR\">processing personal data without notifying the Authority in accordance with the provision that sets out the obligation to notify the Authority before commencing any data processing activities (except where certain exceptions apply), or failing to update such notification to the Authority;</li>\r\n 	<li dir=\"LTR\">Processing personal data contrary to the provision that requires prior authorization from the Authority before processing personal data in certain circumstances;</li>\r\n 	<li dir=\"LTR\">Providing false or misleading information to the Authority or to a data subject, or withholding relevant information from the Authority, or otherwise hindering the Authority’s work; and</li>\r\n 	<li dir=\"LTR\">Disclosing any data or information accessed due to work, or using the same for own benefit or for the benefit of others unreasonably and in violation of the provisions of this law.</li>\r\n</ul>\r\n<img class=\"wp-image-8068 alignleft\" src=\"http://www.tamimi.com/wp-content/uploads/2018/08/56.jpg\" alt=\"\" width=\"429\" height=\"286\" />\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Security considerations</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Generally, the security of processing provisions, and the confidentiality provisions, appear to be fairly standard.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Data controllers are required to apply technical and organizational measures capable of protecting personal data against unintentional or unauthorized destruction, accidental loss, unauthorized alteration, disclosure or access, or any other form of processing. The measures adopted need to be appropriate, bearing in mind the nature of the data in question and the risks associated with processing it. The Law also indicates that ‘state-of-the-art’ technological protection measures should be adopted, but this is tempered by reference to the costs arising from use of such technology.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Additionally, the Law contemplates the issuance of a regulation specifying requirements that technical and organisational measures must satisfy. It also provides scope for specific requirements to be prescribed in such regulations.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Data controllers are required to maintain documentation that reflects the technical and organizational measures adopted. This documentation must be available for viewing by the parties concerned (presumably, including data subjects), as well as the Authority, any data processors, and the data controller itself.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">With regard to processing by data processors, the Law requires data controllers to engage only data processors who provide sufficient guarantees regarding the application of technical and organisational measures. Importantly, there is an obligation on data controllers to take steps to verify compliance with such measures, and to enter into a written contract with the data processor requiring that the data processor shall only process data in accordance with the instructions of the data controller, and in accordance with the data controller’s requirements with regard to security and confidentiality.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">There does not appear to be any specific obligation to notify the Authority in the event of a data breach incident. It is possible that this level of detail might be addressed in the regulations, or that the Authority is expected to address breaches only in the event that they become aware of them, and the circumstances indicate a breach of the obligation to use suitable technical and organizational security measures.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Data protection supervisor</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law contemplates a role of ‘Data Protection Supervisor’ (which is not a data protection officer) intended to act as an independent and impartial intermediary between the data controller and the Authority.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The data protection supervisor will help the data controller fulfil its rights and obligations, and coordinate between the data controller and the Authority. It will also be required to verify the data controller’s processing in compliance with the law, alert the data controller to any apparent non-compliance to enable the issue to be addressed, and alert the Authority where such non-compliance has not been addressed within a specified timeframe. The data protection supervisor will also be required to maintain a register of the data controller’s processing operations that the data controller must notify the Authority, and update the Authority of the same on a monthly basis. (If no data protection supervisor is appointed, then the data controller is required to do this itself.)</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The qualifications and requirements for registration as a data protection supervisor will be officially issued, and data protection supervisors will need to be registered on a register maintained by the Authority. The requirement to appoint a data protection supervisor is optional, although it may be made compulsory for specific categories of data controllers.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The concept of a data protection supervisor has the potential to result in a whole new industry in the Bahrain market. The regulations setting out the requirements for the registration of data protection supervisors may shed greater light on what is anticipated, in terms of who might be able to fulfil such roles. The most natural development may be for the role to be filled by consulting/audit firms with expertise in data protection related issues.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Conclusion</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Bahrain’s new Data Protection Law will require a great deal of attention from businesses operating in Bahrain. Data protection has not been a high priority topic for most businesses in Bahrain, with the limited exception of international entities subject to data protection requirements in other jurisdictions in which they operate. While the publication of the new Law will result in some degree of a lead-in period within which entities subject to the Law will need to comply, the fact that the Law creates criminal offences means that compliance is all the more important and should be treated as a high priority.</p>'),
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(260753, 25296, 'EditorLinkPost', 'https://www.tamimi.com/wp-admin/post.php?post=7957&amp;action=edit'),
(260754, 25296, 'ReportText', '<p dir=\"LTR\" align=\"LEFT\"><img class=\"size-full wp-image-8044 alignnone\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/cvdfd.jpg\" alt=\"\" width=\"6000\" height=\"2401\" /></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Bahrain’s Law on the Protection of Personal Data was published on 19 July 2018, and will come into effect on 1 August 2019. The Law will require a variety of changes to the way businesses process personal data in Bahrain or about residents of Bahrain. Data protection has not been a high priority topic for most businesses in Bahrain, with the limited exception of international entities subject to data protection requirements in other jurisdictions in which they operate. While the publication of the new Law provides a considerable lead-in period within which entities subject to the Law will need to comply, the fact that the Law creates criminal offences means that compliance is all the more important and should be treated as a high priority.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Until now, and with one exception (namely, Qatar), none of the Gulf Cooperation Council member states had a modern, nationally applicable data protection law. Legal issues relating to privacy and data protection are typically analysed in terms of general, and ill-fitting, criminal provisions relating to the unauthorized disclosure of secrets, or – in appropriate circumstances - industry-specific obligations relating to healthcare or credit data, or telecommunications sector subscriber data.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law is generally composed of 60 articles divided into three broad sections or ‘titles’. These are:</p>\r\n\r\n<ul>\r\n 	<li dir=\"LTR\">Title 1: Processing Provisions – Including definitions and general rules for the legality of processing, controls of data processing and transfer, statements as well as the rights of the data holder.</li>\r\n 	<li dir=\"LTR\">Title 2: Data Protection Authority - Including provisions relating to the establishment of the regulator, and its rights and responsibilities.</li>\r\n 	<li dir=\"LTR\">Title 3: Accountability of the data manager (data controller) and data processor – Including provisions relating to accountability to the regulator, investigation procedures, civil and criminal liability, and penalties for violation.</li>\r\n</ul>\r\n<p dir=\"LTR\" align=\"LEFT\">In this article, we consider some key areas addressed in the Data Protection Law.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Application</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Bahrain’s Data Protection Law describes the legal protection of personal privacy as among the main constitutional rights of the person, and notes that it should be protected, particularly in the context of the increasing use of electronic/digital means for processing information.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law applies to:</p>\r\n\r\n<ul>\r\n 	<li dir=\"LTR\">Every individual residing normally in Bahrain or having a workplace in Bahrain, and every legal person (corporate) having a place of business in the Kingdom of Bahrain; and</li>\r\n 	<li dir=\"LTR\">Every individual not residing normally in Bahrain or having a workplace in Bahrain, and every legal person (corporate) not having a place of business in the Kingdom of Bahrain, where such persons are processing data using means available in Bahrain, except where such processing means are solely for the purpose of passing data through Bahrain.</li>\r\n</ul>\r\n<p dir=\"LTR\" align=\"LEFT\">In this latter scenario, the legal person (corporate) is required to appoint an authorized representative in Bahrain, and notify the Authority of such appointment. This provision would appear to affect, for example, corporate customers of cloud service providers, where the customer is based outside Bahrain, and the services being provided to the customer are being provided from data centres located in Bahrain.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Criminal provisions</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law criminalizes a variety of acts that would, at most, be the subject of administrative penalties in data protection laws elsewhere. Penalties generally comprise up to one year in prison and/or a fine of between BHD1,000 and BHD20,000 (between about USD 2,600 to about USD 53,000) (or a fine only in the case of corporate entities). The following are examples of activities that attract criminal penalties under the Law:</p>\r\n\r\n<ul>\r\n 	<li dir=\"LTR\">processing sensitive personal data in violation of the provision specifying requirements for processing sensitive personal data;</li>\r\n 	<li dir=\"LTR\">transferring personal data outside Bahrain contrary to the provisions specifying requirements for transfers to jurisdictions that provide an adequate level of data protection, and associated exceptions;</li>\r\n 	<li dir=\"LTR\">processing personal data without notifying the Authority in accordance with the provision that sets out the obligation to notify the Authority before commencing any data processing activities (except where certain exceptions apply), or failing to update such notification to the Authority;</li>\r\n 	<li dir=\"LTR\">Processing personal data contrary to the provision that requires prior authorization from the Authority before processing personal data in certain circumstances;</li>\r\n 	<li dir=\"LTR\">Providing false or misleading information to the Authority or to a data subject, or withholding relevant information from the Authority, or otherwise hindering the Authority’s work; and</li>\r\n 	<li dir=\"LTR\">Disclosing any data or information accessed due to work, or using the same for own benefit or for the benefit of others unreasonably and in violation of the provisions of this law.</li>\r\n</ul>\r\n<img class=\"wp-image-8068 alignleft\" src=\"http://www.tamimi.com/wp-content/uploads/2018/08/56.jpg\" alt=\"\" width=\"429\" height=\"286\" />\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Security considerations</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Generally, the security of processing provisions, and the confidentiality provisions, appear to be fairly standard.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Data controllers are required to apply technical and organizational measures capable of protecting personal data against unintentional or unauthorized destruction, accidental loss, unauthorized alteration, disclosure or access, or any other form of processing. The measures adopted need to be appropriate, bearing in mind the nature of the data in question and the risks associated with processing it. The Law also indicates that ‘state-of-the-art’ technological protection measures should be adopted, but this is tempered by reference to the costs arising from use of such technology.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Additionally, the Law contemplates the issuance of a regulation specifying requirements that technical and organisational measures must satisfy. It also provides scope for specific requirements to be prescribed in such regulations.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Data controllers are required to maintain documentation that reflects the technical and organizational measures adopted. This documentation must be available for viewing by the parties concerned (presumably, including data subjects), as well as the Authority, any data processors, and the data controller itself.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">With regard to processing by data processors, the Law requires data controllers to engage only data processors who provide sufficient guarantees regarding the application of technical and organisational measures. Importantly, there is an obligation on data controllers to take steps to verify compliance with such measures, and to enter into a written contract with the data processor requiring that the data processor shall only process data in accordance with the instructions of the data controller, and in accordance with the data controller’s requirements with regard to security and confidentiality.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">There does not appear to be any specific obligation to notify the Authority in the event of a data breach incident. It is possible that this level of detail might be addressed in the regulations, or that the Authority is expected to address breaches only in the event that they become aware of them, and the circumstances indicate a breach of the obligation to use suitable technical and organizational security measures.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Data protection supervisor</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law contemplates a role of ‘Data Protection Supervisor’ (which is not a data protection officer) intended to act as an independent and impartial intermediary between the data controller and the Authority.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The data protection supervisor will help the data controller fulfil its rights and obligations, and coordinate between the data controller and the Authority. It will also be required to verify the data controller’s processing in compliance with the law, alert the data controller to any apparent non-compliance to enable the issue to be addressed, and alert the Authority where such non-compliance has not been addressed within a specified timeframe. The data protection supervisor will also be required to maintain a register of the data controller’s processing operations that the data controller must notify the Authority, and update the Authority of the same on a monthly basis. (If no data protection supervisor is appointed, then the data controller is required to do this itself.)</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The qualifications and requirements for registration as a data protection supervisor will be officially issued, and data protection supervisors will need to be registered on a register maintained by the Authority. The requirement to appoint a data protection supervisor is optional, although it may be made compulsory for specific categories of data controllers.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The concept of a data protection supervisor has the potential to result in a whole new industry in the Bahrain market. The regulations setting out the requirements for the registration of data protection supervisors may shed greater light on what is anticipated, in terms of who might be able to fulfil such roles. The most natural development may be for the role to be filled by consulting/audit firms with expertise in data protection related issues.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Conclusion</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Bahrain’s new Data Protection Law will require a great deal of attention from businesses operating in Bahrain. Data protection has not been a high priority topic for most businesses in Bahrain, with the limited exception of international entities subject to data protection requirements in other jurisdictions in which they operate. While the publication of the new Law will result in some degree of a lead-in period within which entities subject to the Law will need to comply, the fact that the Law creates criminal offences means that compliance is all the more important and should be treated as a high priority.</p>|<p dir=\"LTR\" align=\"LEFT\"><img class=\"size-full wp-image-8044 alignnone\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/cvdfd.jpg\" alt=\"\" width=\"6000\" height=\"2401\" /></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Bahrain’s Law on the Protection of Personal Data was published on 19 July 2018, and will come into effect on 1 August 2019. The Law will require a variety of changes to the way businesses process personal data in Bahrain or about residents of Bahrain. Data protection has not been a high priority topic for most businesses in Bahrain, with the limited exception of international entities subject to data protection requirements in other jurisdictions in which they operate. While the publication of the new Law provides a considerable lead-in period within which entities subject to the Law will need to comply, the fact that the Law creates criminal offences means that compliance is all the more important and should be treated as a high priority.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Until now, and with one exception (namely, Qatar), none of the Gulf Cooperation Council member states had a modern, nationally applicable data protection law. Legal issues relating to privacy and data protection are typically analysed in terms of general, and ill-fitting, criminal provisions relating to the unauthorized disclosure of secrets, or – in appropriate circumstances - industry-specific obligations relating to healthcare or credit data, or telecommunications sector subscriber data.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law is generally composed of 60 articles divided into three broad sections or ‘titles’. These are:</p>\r\n\r\n<ul>\r\n 	<li dir=\"LTR\">Title 1: Processing Provisions – Including definitions and general rules for the legality of processing, controls of data processing and transfer, statements as well as the rights of the data holder.</li>\r\n 	<li dir=\"LTR\">Title 2: Data Protection Authority - Including provisions relating to the establishment of the regulator, and its rights and responsibilities.</li>\r\n 	<li dir=\"LTR\">Title 3: Accountability of the data manager (data controller) and data processor – Including provisions relating to accountability to the regulator, investigation procedures, civil and criminal liability, and penalties for violation.</li>\r\n</ul>\r\n<p dir=\"LTR\" align=\"LEFT\">In this article, we consider some key areas addressed in the Data Protection Law.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Application</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Bahrain’s Data Protection Law describes the legal protection of personal privacy as among the main constitutional rights of the person, and notes that it should be protected, particularly in the context of the increasing use of electronic/digital means for processing information.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law applies to:</p>\r\n\r\n<ul>\r\n 	<li dir=\"LTR\">Every individual residing normally in Bahrain or having a workplace in Bahrain, and every legal person (corporate) having a place of business in the Kingdom of Bahrain; and</li>\r\n 	<li dir=\"LTR\">Every individual not residing normally in Bahrain or having a workplace in Bahrain, and every legal person (corporate) not having a place of business in the Kingdom of Bahrain, where such persons are processing data using means available in Bahrain, except where such processing means are solely for the purpose of passing data through Bahrain.</li>\r\n</ul>\r\n<p dir=\"LTR\" align=\"LEFT\">In this latter scenario, the legal person (corporate) is required to appoint an authorized representative in Bahrain, and notify the Authority of such appointment. This provision would appear to affect, for example, corporate customers of cloud service providers, where the customer is based outside Bahrain, and the services being provided to the customer are being provided from data centres located in Bahrain.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Criminal provisions</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law criminalizes a variety of acts that would, at most, be the subject of administrative penalties in data protection laws elsewhere. Penalties generally comprise up to one year in prison and/or a fine of between BHD1,000 and BHD20,000 (between about USD 2,600 to about USD 53,000) (or a fine only in the case of corporate entities). The following are examples of activities that attract criminal penalties under the Law:</p>\r\n\r\n<ul>\r\n 	<li dir=\"LTR\">processing sensitive personal data in violation of the provision specifying requirements for processing sensitive personal data;</li>\r\n 	<li dir=\"LTR\">transferring personal data outside Bahrain contrary to the provisions specifying requirements for transfers to jurisdictions that provide an adequate level of data protection, and associated exceptions;</li>\r\n 	<li dir=\"LTR\">processing personal data without notifying the Authority in accordance with the provision that sets out the obligation to notify the Authority before commencing any data processing activities (except where certain exceptions apply), or failing to update such notification to the Authority;</li>\r\n 	<li dir=\"LTR\">Processing personal data contrary to the provision that requires prior authorization from the Authority before processing personal data in certain circumstances;</li>\r\n 	<li dir=\"LTR\">Providing false or misleading information to the Authority or to a data subject, or withholding relevant information from the Authority, or otherwise hindering the Authority’s work; and</li>\r\n 	<li dir=\"LTR\">Disclosing any data or information accessed due to work, or using the same for own benefit or for the benefit of others unreasonably and in violation of the provisions of this law.</li>\r\n</ul>\r\n<img class=\"wp-image-8068 aligncenter\" src=\"http://www.tamimi.com/wp-content/uploads/2018/08/56.jpg\" alt=\"\" width=\"374\" height=\"249\" />\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Security considerations</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Generally, the security of processing provisions, and the confidentiality provisions, appear to be fairly standard.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Data controllers are required to apply technical and organizational measures capable of protecting personal data against unintentional or unauthorized destruction, accidental loss, unauthorized alteration, disclosure or access, or any other form of processing. The measures adopted need to be appropriate, bearing in mind the nature of the data in question and the risks associated with processing it. The Law also indicates that ‘state-of-the-art’ technological protection measures should be adopted, but this is tempered by reference to the costs arising from use of such technology.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Additionally, the Law contemplates the issuance of a regulation specifying requirements that technical and organisational measures must satisfy. It also provides scope for specific requirements to be prescribed in such regulations.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Data controllers are required to maintain documentation that reflects the technical and organizational measures adopted. This documentation must be available for viewing by the parties concerned (presumably, including data subjects), as well as the Authority, any data processors, and the data controller itself.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">With regard to processing by data processors, the Law requires data controllers to engage only data processors who provide sufficient guarantees regarding the application of technical and organisational measures. Importantly, there is an obligation on data controllers to take steps to verify compliance with such measures, and to enter into a written contract with the data processor requiring that the data processor shall only process data in accordance with the instructions of the data controller, and in accordance with the data controller’s requirements with regard to security and confidentiality.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">There does not appear to be any specific obligation to notify the Authority in the event of a data breach incident. It is possible that this level of detail might be addressed in the regulations, or that the Authority is expected to address breaches only in the event that they become aware of them, and the circumstances indicate a breach of the obligation to use suitable technical and organizational security measures.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Data protection supervisor</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law contemplates a role of ‘Data Protection Supervisor’ (which is not a data protection officer) intended to act as an independent and impartial intermediary between the data controller and the Authority.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The data protection supervisor will help the data controller fulfil its rights and obligations, and coordinate between the data controller and the Authority. It will also be required to verify the data controller’s processing in compliance with the law, alert the data controller to any apparent non-compliance to enable the issue to be addressed, and alert the Authority where such non-compliance has not been addressed within a specified timeframe. The data protection supervisor will also be required to maintain a register of the data controller’s processing operations that the data controller must notify the Authority, and update the Authority of the same on a monthly basis. (If no data protection supervisor is appointed, then the data controller is required to do this itself.)</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The qualifications and requirements for registration as a data protection supervisor will be officially issued, and data protection supervisors will need to be registered on a register maintained by the Authority. The requirement to appoint a data protection supervisor is optional, although it may be made compulsory for specific categories of data controllers.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The concept of a data protection supervisor has the potential to result in a whole new industry in the Bahrain market. The regulations setting out the requirements for the registration of data protection supervisors may shed greater light on what is anticipated, in terms of who might be able to fulfil such roles. The most natural development may be for the role to be filled by consulting/audit firms with expertise in data protection related issues.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Conclusion</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Bahrain’s new Data Protection Law will require a great deal of attention from businesses operating in Bahrain. Data protection has not been a high priority topic for most businesses in Bahrain, with the limited exception of international entities subject to data protection requirements in other jurisdictions in which they operate. While the publication of the new Law will result in some degree of a lead-in period within which entities subject to the Law will need to comply, the fact that the Law creates criminal offences means that compliance is all the more important and should be treated as a high priority.</p>'),
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(260793, 25300, 'PostTitle', 'Catching the wave: New Data Protection Law in Bahrain'),
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(260796, 25300, 'PostDate', '2018-08-01 07:45:44'),
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(260800, 25300, 'MetaValueNew', '<p dir=\"LTR\" align=\"LEFT\"><img class=\"size-full wp-image-8044 alignnone\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/cvdfd.jpg\" alt=\"\" width=\"6000\" height=\"2401\" /></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Bahrain’s Law on the Protection of Personal Data was published on 19 July 2018, and will come into effect on 1 August 2019. The Law will require a variety of changes to the way businesses process personal data in Bahrain or about residents of Bahrain. Data protection has not been a high priority topic for most businesses in Bahrain, with the limited exception of international entities subject to data protection requirements in other jurisdictions in which they operate. While the publication of the new Law provides a considerable lead-in period within which entities subject to the Law will need to comply, the fact that the Law creates criminal offences means that compliance is all the more important and should be treated as a high priority.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Until now, and with one exception (namely, Qatar), none of the Gulf Cooperation Council member states had a modern, nationally applicable data protection law. Legal issues relating to privacy and data protection are typically analysed in terms of general, and ill-fitting, criminal provisions relating to the unauthorized disclosure of secrets, or – in appropriate circumstances - industry-specific obligations relating to healthcare or credit data, or telecommunications sector subscriber data.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law is generally composed of 60 articles divided into three broad sections or ‘titles’. These are:</p>\r\n\r\n<ul>\r\n 	<li dir=\"LTR\">Title 1: Processing Provisions – Including definitions and general rules for the legality of processing, controls of data processing and transfer, statements as well as the rights of the data holder.</li>\r\n 	<li dir=\"LTR\">Title 2: Data Protection Authority - Including provisions relating to the establishment of the regulator, and its rights and responsibilities.</li>\r\n 	<li dir=\"LTR\">Title 3: Accountability of the data manager (data controller) and data processor – Including provisions relating to accountability to the regulator, investigation procedures, civil and criminal liability, and penalties for violation.</li>\r\n</ul>\r\n<p dir=\"LTR\" align=\"LEFT\">In this article, we consider some key areas addressed in the Data Protection Law.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Application</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Bahrain’s Data Protection Law describes the legal protection of personal privacy as among the main constitutional rights of the person, and notes that it should be protected, particularly in the context of the increasing use of electronic/digital means for processing information.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law applies to:</p>\r\n\r\n<ul>\r\n 	<li dir=\"LTR\">Every individual residing normally in Bahrain or having a workplace in Bahrain, and every legal person (corporate) having a place of business in the Kingdom of Bahrain; and</li>\r\n 	<li dir=\"LTR\">Every individual not residing normally in Bahrain or having a workplace in Bahrain, and every legal person (corporate) not having a place of business in the Kingdom of Bahrain, where such persons are processing data using means available in Bahrain, except where such processing means are solely for the purpose of passing data through Bahrain.</li>\r\n</ul>\r\n<p dir=\"LTR\" align=\"LEFT\">In this latter scenario, the legal person (corporate) is required to appoint an authorized representative in Bahrain, and notify the Authority of such appointment. This provision would appear to affect, for example, corporate customers of cloud service providers, where the customer is based outside Bahrain, and the services being provided to the customer are being provided from data centres located in Bahrain.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Criminal provisions</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law criminalizes a variety of acts that would, at most, be the subject of administrative penalties in data protection laws elsewhere. Penalties generally comprise up to one year in prison and/or a fine of between BHD1,000 and BHD20,000 (between about USD 2,600 to about USD 53,000) (or a fine only in the case of corporate entities). The following are examples of activities that attract criminal penalties under the Law:</p>\r\n\r\n<ul>\r\n 	<li dir=\"LTR\">processing sensitive personal data in violation of the provision specifying requirements for processing sensitive personal data;</li>\r\n 	<li dir=\"LTR\">transferring personal data outside Bahrain contrary to the provisions specifying requirements for transfers to jurisdictions that provide an adequate level of data protection, and associated exceptions;</li>\r\n 	<li dir=\"LTR\">processing personal data without notifying the Authority in accordance with the provision that sets out the obligation to notify the Authority before commencing any data processing activities (except where certain exceptions apply), or failing to update such notification to the Authority;</li>\r\n 	<li dir=\"LTR\">Processing personal data contrary to the provision that requires prior authorization from the Authority before processing personal data in certain circumstances;</li>\r\n 	<li dir=\"LTR\">Providing false or misleading information to the Authority or to a data subject, or withholding relevant information from the Authority, or otherwise hindering the Authority’s work; and</li>\r\n 	<li dir=\"LTR\">Disclosing any data or information accessed due to work, or using the same for own benefit or for the benefit of others unreasonably and in violation of the provisions of this law.</li>\r\n</ul>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Security considerations</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\"><img class=\"wp-image-8068 alignleft\" src=\"http://www.tamimi.com/wp-content/uploads/2018/08/56.jpg\" alt=\"\" width=\"374\" height=\"249\" />Generally, the security of processing provisions, and the confidentiality provisions, appear to be fairly standard.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Data controllers are required to apply technical and organizational measures capable of protecting personal data against unintentional or unauthorized destruction, accidental loss, unauthorized alteration, disclosure or access, or any other form of processing. The measures adopted need to be appropriate, bearing in mind the nature of the data in question and the risks associated with processing it. The Law also indicates that ‘state-of-the-art’ technological protection measures should be adopted, but this is tempered by reference to the costs arising from use of such technology.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Additionally, the Law contemplates the issuance of a regulation specifying requirements that technical and organisational measures must satisfy. It also provides scope for specific requirements to be prescribed in such regulations.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Data controllers are required to maintain documentation that reflects the technical and organizational measures adopted. This documentation must be available for viewing by the parties concerned (presumably, including data subjects), as well as the Authority, any data processors, and the data controller itself.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">With regard to processing by data processors, the Law requires data controllers to engage only data processors who provide sufficient guarantees regarding the application of technical and organisational measures. Importantly, there is an obligation on data controllers to take steps to verify compliance with such measures, and to enter into a written contract with the data processor requiring that the data processor shall only process data in accordance with the instructions of the data controller, and in accordance with the data controller’s requirements with regard to security and confidentiality.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">There does not appear to be any specific obligation to notify the Authority in the event of a data breach incident. It is possible that this level of detail might be addressed in the regulations, or that the Authority is expected to address breaches only in the event that they become aware of them, and the circumstances indicate a breach of the obligation to use suitable technical and organizational security measures.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Data protection supervisor</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law contemplates a role of ‘Data Protection Supervisor’ (which is not a data protection officer) intended to act as an independent and impartial intermediary between the data controller and the Authority.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The data protection supervisor will help the data controller fulfil its rights and obligations, and coordinate between the data controller and the Authority. It will also be required to verify the data controller’s processing in compliance with the law, alert the data controller to any apparent non-compliance to enable the issue to be addressed, and alert the Authority where such non-compliance has not been addressed within a specified timeframe. The data protection supervisor will also be required to maintain a register of the data controller’s processing operations that the data controller must notify the Authority, and update the Authority of the same on a monthly basis. (If no data protection supervisor is appointed, then the data controller is required to do this itself.)</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The qualifications and requirements for registration as a data protection supervisor will be officially issued, and data protection supervisors will need to be registered on a register maintained by the Authority. The requirement to appoint a data protection supervisor is optional, although it may be made compulsory for specific categories of data controllers.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The concept of a data protection supervisor has the potential to result in a whole new industry in the Bahrain market. The regulations setting out the requirements for the registration of data protection supervisors may shed greater light on what is anticipated, in terms of who might be able to fulfil such roles. The most natural development may be for the role to be filled by consulting/audit firms with expertise in data protection related issues.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Conclusion</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Bahrain’s new Data Protection Law will require a great deal of attention from businesses operating in Bahrain. Data protection has not been a high priority topic for most businesses in Bahrain, with the limited exception of international entities subject to data protection requirements in other jurisdictions in which they operate. While the publication of the new Law will result in some degree of a lead-in period within which entities subject to the Law will need to comply, the fact that the Law creates criminal offences means that compliance is all the more important and should be treated as a high priority.</p>');
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(260801, 25300, 'MetaValueOld', '<p dir=\"LTR\" align=\"LEFT\"><img class=\"size-full wp-image-8044 alignnone\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/cvdfd.jpg\" alt=\"\" width=\"6000\" height=\"2401\" /></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Bahrain’s Law on the Protection of Personal Data was published on 19 July 2018, and will come into effect on 1 August 2019. The Law will require a variety of changes to the way businesses process personal data in Bahrain or about residents of Bahrain. Data protection has not been a high priority topic for most businesses in Bahrain, with the limited exception of international entities subject to data protection requirements in other jurisdictions in which they operate. While the publication of the new Law provides a considerable lead-in period within which entities subject to the Law will need to comply, the fact that the Law creates criminal offences means that compliance is all the more important and should be treated as a high priority.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Until now, and with one exception (namely, Qatar), none of the Gulf Cooperation Council member states had a modern, nationally applicable data protection law. Legal issues relating to privacy and data protection are typically analysed in terms of general, and ill-fitting, criminal provisions relating to the unauthorized disclosure of secrets, or – in appropriate circumstances - industry-specific obligations relating to healthcare or credit data, or telecommunications sector subscriber data.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law is generally composed of 60 articles divided into three broad sections or ‘titles’. These are:</p>\r\n\r\n<ul>\r\n 	<li dir=\"LTR\">Title 1: Processing Provisions – Including definitions and general rules for the legality of processing, controls of data processing and transfer, statements as well as the rights of the data holder.</li>\r\n 	<li dir=\"LTR\">Title 2: Data Protection Authority - Including provisions relating to the establishment of the regulator, and its rights and responsibilities.</li>\r\n 	<li dir=\"LTR\">Title 3: Accountability of the data manager (data controller) and data processor – Including provisions relating to accountability to the regulator, investigation procedures, civil and criminal liability, and penalties for violation.</li>\r\n</ul>\r\n<p dir=\"LTR\" align=\"LEFT\">In this article, we consider some key areas addressed in the Data Protection Law.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Application</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Bahrain’s Data Protection Law describes the legal protection of personal privacy as among the main constitutional rights of the person, and notes that it should be protected, particularly in the context of the increasing use of electronic/digital means for processing information.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law applies to:</p>\r\n\r\n<ul>\r\n 	<li dir=\"LTR\">Every individual residing normally in Bahrain or having a workplace in Bahrain, and every legal person (corporate) having a place of business in the Kingdom of Bahrain; and</li>\r\n 	<li dir=\"LTR\">Every individual not residing normally in Bahrain or having a workplace in Bahrain, and every legal person (corporate) not having a place of business in the Kingdom of Bahrain, where such persons are processing data using means available in Bahrain, except where such processing means are solely for the purpose of passing data through Bahrain.</li>\r\n</ul>\r\n<p dir=\"LTR\" align=\"LEFT\">In this latter scenario, the legal person (corporate) is required to appoint an authorized representative in Bahrain, and notify the Authority of such appointment. This provision would appear to affect, for example, corporate customers of cloud service providers, where the customer is based outside Bahrain, and the services being provided to the customer are being provided from data centres located in Bahrain.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Criminal provisions</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law criminalizes a variety of acts that would, at most, be the subject of administrative penalties in data protection laws elsewhere. Penalties generally comprise up to one year in prison and/or a fine of between BHD1,000 and BHD20,000 (between about USD 2,600 to about USD 53,000) (or a fine only in the case of corporate entities). The following are examples of activities that attract criminal penalties under the Law:</p>\r\n\r\n<ul>\r\n 	<li dir=\"LTR\">processing sensitive personal data in violation of the provision specifying requirements for processing sensitive personal data;</li>\r\n 	<li dir=\"LTR\">transferring personal data outside Bahrain contrary to the provisions specifying requirements for transfers to jurisdictions that provide an adequate level of data protection, and associated exceptions;</li>\r\n 	<li dir=\"LTR\">processing personal data without notifying the Authority in accordance with the provision that sets out the obligation to notify the Authority before commencing any data processing activities (except where certain exceptions apply), or failing to update such notification to the Authority;</li>\r\n 	<li dir=\"LTR\">Processing personal data contrary to the provision that requires prior authorization from the Authority before processing personal data in certain circumstances;</li>\r\n 	<li dir=\"LTR\">Providing false or misleading information to the Authority or to a data subject, or withholding relevant information from the Authority, or otherwise hindering the Authority’s work; and</li>\r\n 	<li dir=\"LTR\">Disclosing any data or information accessed due to work, or using the same for own benefit or for the benefit of others unreasonably and in violation of the provisions of this law.</li>\r\n</ul>\r\n<img class=\"wp-image-8068 aligncenter\" src=\"http://www.tamimi.com/wp-content/uploads/2018/08/56.jpg\" alt=\"\" width=\"374\" height=\"249\" />\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Security considerations</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Generally, the security of processing provisions, and the confidentiality provisions, appear to be fairly standard.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Data controllers are required to apply technical and organizational measures capable of protecting personal data against unintentional or unauthorized destruction, accidental loss, unauthorized alteration, disclosure or access, or any other form of processing. The measures adopted need to be appropriate, bearing in mind the nature of the data in question and the risks associated with processing it. The Law also indicates that ‘state-of-the-art’ technological protection measures should be adopted, but this is tempered by reference to the costs arising from use of such technology.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Additionally, the Law contemplates the issuance of a regulation specifying requirements that technical and organisational measures must satisfy. It also provides scope for specific requirements to be prescribed in such regulations.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Data controllers are required to maintain documentation that reflects the technical and organizational measures adopted. This documentation must be available for viewing by the parties concerned (presumably, including data subjects), as well as the Authority, any data processors, and the data controller itself.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">With regard to processing by data processors, the Law requires data controllers to engage only data processors who provide sufficient guarantees regarding the application of technical and organisational measures. Importantly, there is an obligation on data controllers to take steps to verify compliance with such measures, and to enter into a written contract with the data processor requiring that the data processor shall only process data in accordance with the instructions of the data controller, and in accordance with the data controller’s requirements with regard to security and confidentiality.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">There does not appear to be any specific obligation to notify the Authority in the event of a data breach incident. It is possible that this level of detail might be addressed in the regulations, or that the Authority is expected to address breaches only in the event that they become aware of them, and the circumstances indicate a breach of the obligation to use suitable technical and organizational security measures.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Data protection supervisor</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law contemplates a role of ‘Data Protection Supervisor’ (which is not a data protection officer) intended to act as an independent and impartial intermediary between the data controller and the Authority.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The data protection supervisor will help the data controller fulfil its rights and obligations, and coordinate between the data controller and the Authority. It will also be required to verify the data controller’s processing in compliance with the law, alert the data controller to any apparent non-compliance to enable the issue to be addressed, and alert the Authority where such non-compliance has not been addressed within a specified timeframe. The data protection supervisor will also be required to maintain a register of the data controller’s processing operations that the data controller must notify the Authority, and update the Authority of the same on a monthly basis. (If no data protection supervisor is appointed, then the data controller is required to do this itself.)</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The qualifications and requirements for registration as a data protection supervisor will be officially issued, and data protection supervisors will need to be registered on a register maintained by the Authority. The requirement to appoint a data protection supervisor is optional, although it may be made compulsory for specific categories of data controllers.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The concept of a data protection supervisor has the potential to result in a whole new industry in the Bahrain market. The regulations setting out the requirements for the registration of data protection supervisors may shed greater light on what is anticipated, in terms of who might be able to fulfil such roles. The most natural development may be for the role to be filled by consulting/audit firms with expertise in data protection related issues.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Conclusion</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Bahrain’s new Data Protection Law will require a great deal of attention from businesses operating in Bahrain. Data protection has not been a high priority topic for most businesses in Bahrain, with the limited exception of international entities subject to data protection requirements in other jurisdictions in which they operate. While the publication of the new Law will result in some degree of a lead-in period within which entities subject to the Law will need to comply, the fact that the Law creates criminal offences means that compliance is all the more important and should be treated as a high priority.</p>'),
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(260804, 25300, 'ReportText', '<p dir=\"LTR\" align=\"LEFT\"><img class=\"size-full wp-image-8044 alignnone\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/cvdfd.jpg\" alt=\"\" width=\"6000\" height=\"2401\" /></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Bahrain’s Law on the Protection of Personal Data was published on 19 July 2018, and will come into effect on 1 August 2019. The Law will require a variety of changes to the way businesses process personal data in Bahrain or about residents of Bahrain. Data protection has not been a high priority topic for most businesses in Bahrain, with the limited exception of international entities subject to data protection requirements in other jurisdictions in which they operate. While the publication of the new Law provides a considerable lead-in period within which entities subject to the Law will need to comply, the fact that the Law creates criminal offences means that compliance is all the more important and should be treated as a high priority.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Until now, and with one exception (namely, Qatar), none of the Gulf Cooperation Council member states had a modern, nationally applicable data protection law. Legal issues relating to privacy and data protection are typically analysed in terms of general, and ill-fitting, criminal provisions relating to the unauthorized disclosure of secrets, or – in appropriate circumstances - industry-specific obligations relating to healthcare or credit data, or telecommunications sector subscriber data.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law is generally composed of 60 articles divided into three broad sections or ‘titles’. These are:</p>\r\n\r\n<ul>\r\n 	<li dir=\"LTR\">Title 1: Processing Provisions – Including definitions and general rules for the legality of processing, controls of data processing and transfer, statements as well as the rights of the data holder.</li>\r\n 	<li dir=\"LTR\">Title 2: Data Protection Authority - Including provisions relating to the establishment of the regulator, and its rights and responsibilities.</li>\r\n 	<li dir=\"LTR\">Title 3: Accountability of the data manager (data controller) and data processor – Including provisions relating to accountability to the regulator, investigation procedures, civil and criminal liability, and penalties for violation.</li>\r\n</ul>\r\n<p dir=\"LTR\" align=\"LEFT\">In this article, we consider some key areas addressed in the Data Protection Law.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Application</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Bahrain’s Data Protection Law describes the legal protection of personal privacy as among the main constitutional rights of the person, and notes that it should be protected, particularly in the context of the increasing use of electronic/digital means for processing information.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law applies to:</p>\r\n\r\n<ul>\r\n 	<li dir=\"LTR\">Every individual residing normally in Bahrain or having a workplace in Bahrain, and every legal person (corporate) having a place of business in the Kingdom of Bahrain; and</li>\r\n 	<li dir=\"LTR\">Every individual not residing normally in Bahrain or having a workplace in Bahrain, and every legal person (corporate) not having a place of business in the Kingdom of Bahrain, where such persons are processing data using means available in Bahrain, except where such processing means are solely for the purpose of passing data through Bahrain.</li>\r\n</ul>\r\n<p dir=\"LTR\" align=\"LEFT\">In this latter scenario, the legal person (corporate) is required to appoint an authorized representative in Bahrain, and notify the Authority of such appointment. This provision would appear to affect, for example, corporate customers of cloud service providers, where the customer is based outside Bahrain, and the services being provided to the customer are being provided from data centres located in Bahrain.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Criminal provisions</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law criminalizes a variety of acts that would, at most, be the subject of administrative penalties in data protection laws elsewhere. Penalties generally comprise up to one year in prison and/or a fine of between BHD1,000 and BHD20,000 (between about USD 2,600 to about USD 53,000) (or a fine only in the case of corporate entities). The following are examples of activities that attract criminal penalties under the Law:</p>\r\n\r\n<ul>\r\n 	<li dir=\"LTR\">processing sensitive personal data in violation of the provision specifying requirements for processing sensitive personal data;</li>\r\n 	<li dir=\"LTR\">transferring personal data outside Bahrain contrary to the provisions specifying requirements for transfers to jurisdictions that provide an adequate level of data protection, and associated exceptions;</li>\r\n 	<li dir=\"LTR\">processing personal data without notifying the Authority in accordance with the provision that sets out the obligation to notify the Authority before commencing any data processing activities (except where certain exceptions apply), or failing to update such notification to the Authority;</li>\r\n 	<li dir=\"LTR\">Processing personal data contrary to the provision that requires prior authorization from the Authority before processing personal data in certain circumstances;</li>\r\n 	<li dir=\"LTR\">Providing false or misleading information to the Authority or to a data subject, or withholding relevant information from the Authority, or otherwise hindering the Authority’s work; and</li>\r\n 	<li dir=\"LTR\">Disclosing any data or information accessed due to work, or using the same for own benefit or for the benefit of others unreasonably and in violation of the provisions of this law.</li>\r\n</ul>\r\n<img class=\"wp-image-8068 aligncenter\" src=\"http://www.tamimi.com/wp-content/uploads/2018/08/56.jpg\" alt=\"\" width=\"374\" height=\"249\" />\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Security considerations</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Generally, the security of processing provisions, and the confidentiality provisions, appear to be fairly standard.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Data controllers are required to apply technical and organizational measures capable of protecting personal data against unintentional or unauthorized destruction, accidental loss, unauthorized alteration, disclosure or access, or any other form of processing. The measures adopted need to be appropriate, bearing in mind the nature of the data in question and the risks associated with processing it. The Law also indicates that ‘state-of-the-art’ technological protection measures should be adopted, but this is tempered by reference to the costs arising from use of such technology.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Additionally, the Law contemplates the issuance of a regulation specifying requirements that technical and organisational measures must satisfy. It also provides scope for specific requirements to be prescribed in such regulations.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Data controllers are required to maintain documentation that reflects the technical and organizational measures adopted. This documentation must be available for viewing by the parties concerned (presumably, including data subjects), as well as the Authority, any data processors, and the data controller itself.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">With regard to processing by data processors, the Law requires data controllers to engage only data processors who provide sufficient guarantees regarding the application of technical and organisational measures. Importantly, there is an obligation on data controllers to take steps to verify compliance with such measures, and to enter into a written contract with the data processor requiring that the data processor shall only process data in accordance with the instructions of the data controller, and in accordance with the data controller’s requirements with regard to security and confidentiality.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">There does not appear to be any specific obligation to notify the Authority in the event of a data breach incident. It is possible that this level of detail might be addressed in the regulations, or that the Authority is expected to address breaches only in the event that they become aware of them, and the circumstances indicate a breach of the obligation to use suitable technical and organizational security measures.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Data protection supervisor</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law contemplates a role of ‘Data Protection Supervisor’ (which is not a data protection officer) intended to act as an independent and impartial intermediary between the data controller and the Authority.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The data protection supervisor will help the data controller fulfil its rights and obligations, and coordinate between the data controller and the Authority. It will also be required to verify the data controller’s processing in compliance with the law, alert the data controller to any apparent non-compliance to enable the issue to be addressed, and alert the Authority where such non-compliance has not been addressed within a specified timeframe. The data protection supervisor will also be required to maintain a register of the data controller’s processing operations that the data controller must notify the Authority, and update the Authority of the same on a monthly basis. (If no data protection supervisor is appointed, then the data controller is required to do this itself.)</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The qualifications and requirements for registration as a data protection supervisor will be officially issued, and data protection supervisors will need to be registered on a register maintained by the Authority. The requirement to appoint a data protection supervisor is optional, although it may be made compulsory for specific categories of data controllers.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The concept of a data protection supervisor has the potential to result in a whole new industry in the Bahrain market. The regulations setting out the requirements for the registration of data protection supervisors may shed greater light on what is anticipated, in terms of who might be able to fulfil such roles. The most natural development may be for the role to be filled by consulting/audit firms with expertise in data protection related issues.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Conclusion</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Bahrain’s new Data Protection Law will require a great deal of attention from businesses operating in Bahrain. Data protection has not been a high priority topic for most businesses in Bahrain, with the limited exception of international entities subject to data protection requirements in other jurisdictions in which they operate. While the publication of the new Law will result in some degree of a lead-in period within which entities subject to the Law will need to comply, the fact that the Law creates criminal offences means that compliance is all the more important and should be treated as a high priority.</p>|<p dir=\"LTR\" align=\"LEFT\"><img class=\"size-full wp-image-8044 alignnone\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/cvdfd.jpg\" alt=\"\" width=\"6000\" height=\"2401\" /></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Bahrain’s Law on the Protection of Personal Data was published on 19 July 2018, and will come into effect on 1 August 2019. The Law will require a variety of changes to the way businesses process personal data in Bahrain or about residents of Bahrain. Data protection has not been a high priority topic for most businesses in Bahrain, with the limited exception of international entities subject to data protection requirements in other jurisdictions in which they operate. While the publication of the new Law provides a considerable lead-in period within which entities subject to the Law will need to comply, the fact that the Law creates criminal offences means that compliance is all the more important and should be treated as a high priority.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Until now, and with one exception (namely, Qatar), none of the Gulf Cooperation Council member states had a modern, nationally applicable data protection law. Legal issues relating to privacy and data protection are typically analysed in terms of general, and ill-fitting, criminal provisions relating to the unauthorized disclosure of secrets, or – in appropriate circumstances - industry-specific obligations relating to healthcare or credit data, or telecommunications sector subscriber data.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law is generally composed of 60 articles divided into three broad sections or ‘titles’. These are:</p>\r\n\r\n<ul>\r\n 	<li dir=\"LTR\">Title 1: Processing Provisions – Including definitions and general rules for the legality of processing, controls of data processing and transfer, statements as well as the rights of the data holder.</li>\r\n 	<li dir=\"LTR\">Title 2: Data Protection Authority - Including provisions relating to the establishment of the regulator, and its rights and responsibilities.</li>\r\n 	<li dir=\"LTR\">Title 3: Accountability of the data manager (data controller) and data processor – Including provisions relating to accountability to the regulator, investigation procedures, civil and criminal liability, and penalties for violation.</li>\r\n</ul>\r\n<p dir=\"LTR\" align=\"LEFT\">In this article, we consider some key areas addressed in the Data Protection Law.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Application</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Bahrain’s Data Protection Law describes the legal protection of personal privacy as among the main constitutional rights of the person, and notes that it should be protected, particularly in the context of the increasing use of electronic/digital means for processing information.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law applies to:</p>\r\n\r\n<ul>\r\n 	<li dir=\"LTR\">Every individual residing normally in Bahrain or having a workplace in Bahrain, and every legal person (corporate) having a place of business in the Kingdom of Bahrain; and</li>\r\n 	<li dir=\"LTR\">Every individual not residing normally in Bahrain or having a workplace in Bahrain, and every legal person (corporate) not having a place of business in the Kingdom of Bahrain, where such persons are processing data using means available in Bahrain, except where such processing means are solely for the purpose of passing data through Bahrain.</li>\r\n</ul>\r\n<p dir=\"LTR\" align=\"LEFT\">In this latter scenario, the legal person (corporate) is required to appoint an authorized representative in Bahrain, and notify the Authority of such appointment. This provision would appear to affect, for example, corporate customers of cloud service providers, where the customer is based outside Bahrain, and the services being provided to the customer are being provided from data centres located in Bahrain.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Criminal provisions</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law criminalizes a variety of acts that would, at most, be the subject of administrative penalties in data protection laws elsewhere. Penalties generally comprise up to one year in prison and/or a fine of between BHD1,000 and BHD20,000 (between about USD 2,600 to about USD 53,000) (or a fine only in the case of corporate entities). The following are examples of activities that attract criminal penalties under the Law:</p>\r\n\r\n<ul>\r\n 	<li dir=\"LTR\">processing sensitive personal data in violation of the provision specifying requirements for processing sensitive personal data;</li>\r\n 	<li dir=\"LTR\">transferring personal data outside Bahrain contrary to the provisions specifying requirements for transfers to jurisdictions that provide an adequate level of data protection, and associated exceptions;</li>\r\n 	<li dir=\"LTR\">processing personal data without notifying the Authority in accordance with the provision that sets out the obligation to notify the Authority before commencing any data processing activities (except where certain exceptions apply), or failing to update such notification to the Authority;</li>\r\n 	<li dir=\"LTR\">Processing personal data contrary to the provision that requires prior authorization from the Authority before processing personal data in certain circumstances;</li>\r\n 	<li dir=\"LTR\">Providing false or misleading information to the Authority or to a data subject, or withholding relevant information from the Authority, or otherwise hindering the Authority’s work; and</li>\r\n 	<li dir=\"LTR\">Disclosing any data or information accessed due to work, or using the same for own benefit or for the benefit of others unreasonably and in violation of the provisions of this law.</li>\r\n</ul>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Security considerations</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\"><img class=\"wp-image-8068 alignleft\" src=\"http://www.tamimi.com/wp-content/uploads/2018/08/56.jpg\" alt=\"\" width=\"374\" height=\"249\" />Generally, the security of processing provisions, and the confidentiality provisions, appear to be fairly standard.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Data controllers are required to apply technical and organizational measures capable of protecting personal data against unintentional or unauthorized destruction, accidental loss, unauthorized alteration, disclosure or access, or any other form of processing. The measures adopted need to be appropriate, bearing in mind the nature of the data in question and the risks associated with processing it. The Law also indicates that ‘state-of-the-art’ technological protection measures should be adopted, but this is tempered by reference to the costs arising from use of such technology.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Additionally, the Law contemplates the issuance of a regulation specifying requirements that technical and organisational measures must satisfy. It also provides scope for specific requirements to be prescribed in such regulations.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Data controllers are required to maintain documentation that reflects the technical and organizational measures adopted. This documentation must be available for viewing by the parties concerned (presumably, including data subjects), as well as the Authority, any data processors, and the data controller itself.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">With regard to processing by data processors, the Law requires data controllers to engage only data processors who provide sufficient guarantees regarding the application of technical and organisational measures. Importantly, there is an obligation on data controllers to take steps to verify compliance with such measures, and to enter into a written contract with the data processor requiring that the data processor shall only process data in accordance with the instructions of the data controller, and in accordance with the data controller’s requirements with regard to security and confidentiality.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">There does not appear to be any specific obligation to notify the Authority in the event of a data breach incident. It is possible that this level of detail might be addressed in the regulations, or that the Authority is expected to address breaches only in the event that they become aware of them, and the circumstances indicate a breach of the obligation to use suitable technical and organizational security measures.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Data protection supervisor</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law contemplates a role of ‘Data Protection Supervisor’ (which is not a data protection officer) intended to act as an independent and impartial intermediary between the data controller and the Authority.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The data protection supervisor will help the data controller fulfil its rights and obligations, and coordinate between the data controller and the Authority. It will also be required to verify the data controller’s processing in compliance with the law, alert the data controller to any apparent non-compliance to enable the issue to be addressed, and alert the Authority where such non-compliance has not been addressed within a specified timeframe. The data protection supervisor will also be required to maintain a register of the data controller’s processing operations that the data controller must notify the Authority, and update the Authority of the same on a monthly basis. (If no data protection supervisor is appointed, then the data controller is required to do this itself.)</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The qualifications and requirements for registration as a data protection supervisor will be officially issued, and data protection supervisors will need to be registered on a register maintained by the Authority. The requirement to appoint a data protection supervisor is optional, although it may be made compulsory for specific categories of data controllers.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The concept of a data protection supervisor has the potential to result in a whole new industry in the Bahrain market. The regulations setting out the requirements for the registration of data protection supervisors may shed greater light on what is anticipated, in terms of who might be able to fulfil such roles. The most natural development may be for the role to be filled by consulting/audit firms with expertise in data protection related issues.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Conclusion</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Bahrain’s new Data Protection Law will require a great deal of attention from businesses operating in Bahrain. Data protection has not been a high priority topic for most businesses in Bahrain, with the limited exception of international entities subject to data protection requirements in other jurisdictions in which they operate. While the publication of the new Law will result in some degree of a lead-in period within which entities subject to the Law will need to comply, the fact that the Law creates criminal offences means that compliance is all the more important and should be treated as a high priority.</p>'),
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(260839, 25303, 'MetaValueNew', '<p dir=\"LTR\" align=\"LEFT\"><img class=\"alignleft size-full wp-image-8002\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/17-1.png\" alt=\"\" width=\"3567\" height=\"715\" /></p>\r\n</br>The UK legislature has recently introduced domestic legislation aimed at money launderers, potentially resulting in unintended consequences for foreign nationals who have legitimate assets in the UK. These orders demand the intended target provide information about the origin of their wealth, and refusal to disclose that information may render the target subject to criminal prosecution in the UK. However, if the foreign national does comply with the Unexplained Wealth Order (UWO), then that individual may be subject to criminal prosecution in another State… a real Catch 22.\r\n<p dir=\"LTR\" align=\"LEFT\">Controversially, there is no need for a foreign national to be accused of money laundering, or any criminality whatsoever, before they could be made subject to a UWO, which would lead to the freezing of their assets, or, worse, criminal prosecution.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The following article introduces UWOs to our clients and examines how one must be careful in weighing up their rights and obligations in respect of the request of a foreign State’s investigative authorities as it may impact their rights in the UAE, and around the GCC.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What is a UWO?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">On 31st January 2018, the UK introduced their latest attempt at stemming money laundering in the UK: Unexplained Wealth Orders. UWOs are civil investigative powers that are aimed at tackling those who use the UK as a destination for money laundering, or as a destination for those who wish to spend their ill-gotten gains.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">UWOs have been introduced in the UK at a time when London, and the UK, is facing scrutiny as a perceived hotbed of money laundering and revelry. A main proponent of UWOs has been Transparency International UK’s corruption taskforce, who, amongst others, have repeatedly called for greater investigative action to be taken in the UK against individuals and entities thought to have been complicit in corruption, and have led the drive to bring UWOs into action in UK law.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">UWOs are given legal effect pursuant to the UK Proceeds of Crime Act 2002 Article 362A, as introduced by the Criminal Finances Act 2017, and is defined in the legislation as:</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><em>‘An unexplained wealth order is an order requiring the respondent [i.e. the target of the order] to provide a statement—</em></p>\r\n\r\n<ul>\r\n 	<li><em>setting out the nature and extent of the respondent’s interest in the property in respect of which the order is made,</em></li>\r\n 	<li><em>explaining how the respondent obtained the property (including, in particular, how any costs incurred in obtaining it were met),</em></li>\r\n 	<li><em>where the property is held by the trustees of a settlement, setting out such details of the settlement as may be specified in the order, and</em></li>\r\n 	<li><em>setting out such other information in connection with the property as may be so specified.’</em></li>\r\n</ul>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">The clear advantage that UWOs provide for UK investigative authorities is that it is no longer necessary for the UK authorities to demonstrate that an individual has been subject to a conviction for a criminal offence (either in the UK or abroad) in order to obtain information and take measures against a specific property.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Two months after the introduction of the legislation, in March 2018, it would appear that the first orders are now being made. We have seen the first use of these orders, not on a UK national, but on an Asian politician who owns two properties, worth USD $30 million, in the UK. The specific identity of this individual has not been disclosed as matters are ongoing, and no further details are available publically.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">This means that if an individual owns assets in the UK and they are made subject to a UWO, they will be forced to declare how they obtained this asset, and if they fail to do so they would be subject to criminal prosecution by the UK authorities. This may lead to foreign individuals being stuck between a rock and a hard place, with nowhere to turn and no route of escape.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Why is it Relevant To You?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">As will be apparent from the first orders made against the Asian politician, whilst UWOs do apply to individuals who are reasonably suspected of being involved in crime, the UWOs will also target politically exposed individuals who have not been subject to criminal conviction, or investigation, either in the UK or internationally.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The definition of a PEP, or Politically Exposed Person, varies from State to State, but for the purposes of the UK legislation, the legislators have defined PEPs as the following:</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">‘(a) an individual who is, or has been, entrusted with prominent public functions by an international body or by a State other than the UK or other [European Economic Area] State;</p>\r\n<p dir=\"LTR\" align=\"LEFT\">(b) a family member of a person within paragraph (a); or</p>\r\n<p dir=\"LTR\" align=\"LEFT\">(c) known to be a close associate of a person within […] paragraph [a].’</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">Evidently from this definition, paying particularly close attention to (c) namely ‘a close associate’ of an individual with prominent public functions, there is a very expansive definition of PEP, and this will likely include many unsuspecting individuals. The effect of this definition is that if you are an individual who has prominent public functions, or you are a close associate of another who has been entrusted with public functions, then you may now be targeted by the UK authorities with a UWO. Alarmingly, there is no need for you to have committed a crime, nor to have been suspected of being involved in a crime, for these orders to apply to you.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Specifically, when could a UWO apply?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">A UK high court judge can give notice of a UWO if the judge is satisfied that it is likely that a foreign PEP (as defined above) is the owner of suspicious wealth in the UK beyond their means, and if all of the following provisions are met:</p>\r\n\r\n<ol>\r\n 	<li dir=\"LTR\">The respondent’s known income is insufficient to obtain the asset; and</li>\r\n 	<li dir=\"LTR\">The value of the asset is greater than £50,000 (approx. AED 260,000).</li>\r\n</ol>\r\n<p dir=\"LTR\" align=\"LEFT\">This legislation does not only target Foreign PEPs, but also where there are reasonable grounds to suspect any individual has been involved in serious crime.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Applications for UWOs may be made without notice. This means that there is no requirement on the UK investigative authority to notify the target of a UWO that they, or their assets, have been made subject of a UWO.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What assets would this apply to?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">A UWO can be made against assets whose value is greater than £50,000. There is no need for the PEP to be the sole owner of the property whose value is over £50,000, nor is it of relevance if the property was purchased prior to the introduction of the UK legislation.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What is the effect?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Following the making of an order by the High Court, the Court may order an individual’s property to be frozen, which would preclude the subject of the order from dealing with the property. As these freezing orders may be made without notice, this means that an individual’s assets may be frozen prior to their knowledge of any order being made against them.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The UWO will mandate the individual to explain, at a minimum:</p>\r\n\r\n<ol>\r\n 	<li dir=\"LTR\">The nature and extent of their interest in a particular property; and</li>\r\n 	<li dir=\"LTR\">Explain how the property was obtained.</li>\r\n</ol>\r\n<p dir=\"LTR\" align=\"LEFT\">An explanation will be requested by the UK authorities where ‘there are reasonable grounds to suspect that the respondent’s known lawfully obtained income would be insufficient to allow the respondent to obtain the property’.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Failing to Comply?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Should the target of a UWO fail to comply with an order, or provide inaccurate or misleading information, then they will likely be subject to criminal sanction in the UK and may face a period of imprisonment and a financial penalty.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Within the legislation, it is stated that a UWO could lead to criminal liability for a target if that individual fails, without reasonable excuse, to comply with the requirements imposed by the Court against that individual. There is no definition of what a reasonable excuse would be in the legislation, and is a subjective requirement that would be decided in Court during the course of litigation.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong><img class=\"wp-image-8014 size-medium alignright\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/Screen-Shot-2018-07-31-at-5.43.01-PM-242x300.png\" alt=\"\" width=\"242\" height=\"300\" />A View from the East: Stuck between a Rock and a Hard Place?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">These orders, whilst designed to tackle money laundering on a global scale, and limit the use of the UK jurisdiction for those who seek to gain from their ill-gotten earnings, may cause legal difficulties for individuals based in foreign jurisdictions who are subject to UWOs – such as the UAE and the wider GCC – due to a conflict of laws between this UK legislation and that of other countries. This conflict could lead to an individual’s adherence to UK legislation meaning that the individual would be liable to prosecution in other jurisdictions.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Taking the UAE as a representative example of the Middle East’s approach to confidential or private information, the UAE’s jurisdiction imposes very strict obligations on an individual’s use and disclosure of confidential information. It is a criminal offence, pursuant to the UAE’s Federal Law No. 3 of 1987, as amended by Federal Decree No. 7 of 2016 (UAE Penal Code) to disclose secret information. Secret information is afforded an expansive definition in the UAE Penal Code and it is commonly viewed any information that is confidential, i.e. not in the public domain, and that an individual possesses due to their employment or individual nature.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Furthermore, due to the extraterritorial nature of the UAE Penal Code, should an individual commit a crime that is wholly or partly committed within the UAE, then that individual would be bound by the provisions of the Penal Code, and would be bound by provisions such as the disclosure of secret information. Specifically, should an individual be requested to provide secret information, such as the source of funds from a business entity, to the UK authorities, and that information relates to a UAE business or UAE based individual, then if the material or information is disclosed following a UWO in the UK, then in the UAE the individual may be subject to criminal prosecution for disclosing that exact information.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">There is no exception afforded under UAE domestic legislation that would permit an individual to disclose confidential information to a foreign investigative authority (such as the UK’s Serious Fraud Office, Financial Conduct Authority, or National Security Agency). Should that individual disclose such information to the UK’s, or any other foreign State’s, investigative authority, then that individual may be liable to prosecution in the UAE in the same manner as though the disclosure had been made to a private individual or entity.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Prosecution for disclosing confidential information is a serious offence in the UAE, and one that may carry a mandatory minimum period of imprisonment. Accordingly, the stakes are very high when one is subject to an international request for judicial assistance, in any form, and it is for that reason and in order to assist with international criminal investigations that the UAE has entered into number multilateral and bilateral treaties aimed at assisting mutual judicial assistance requests. As with most international requests from law enforcement agencies, such requests should follow the usual diplomatic channels through the deployment of letters rogatory.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The difficulties for UAE individuals would not stop simply at the threat of criminal sanction, but also according to the UAE’s Labour Law, should an individual disclose the secrets of their employer, then the worker may be dismissed without notice and forfeit their entire severance pay.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Accordingly, the receipt of a UWO in the UK demanding that an individual provide information to the UAE authorities may conflict with the statutory protection relating to confidential information (or other laws) in a foreign jurisdiction, such as the UAE. This would lead to the precarious situation where an individual may face prosecution in the UK if he doesn’t comply with the UWO, but criminal prosecution in the UAE if he does comply.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Conclusion</strong></p>\r\nThe above example and review provides a very high-level overview of the competing laws that the UK’s UWOs may catch. Whilst the UK legislation will no doubt serve as an effective deterrent and useful tool in minimising global money laundering, and limiting the attraction of the UK for criminals, it may have unintended consequences for foreign nationals holding legitimate assets in the UK. Prior to making any response to a request for assistance, it is imperative that the recipient apprise themselves of all legal considerations to ensure that they are not jumping out of the frying pan, but straight into the fire.'),
(260840, 25303, 'MetaValueOld', '<p dir=\"LTR\" align=\"LEFT\"><img class=\"alignleft size-full wp-image-8002\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/17-1.png\" alt=\"\" width=\"3567\" height=\"715\" /></p>\r\n</br><p>The UK legislature has recently introduced domestic legislation aimed at money launderers, potentially resulting in unintended consequences for foreign nationals who have legitimate assets in the UK. These orders demand the intended target provide information about the origin of their wealth, and refusal to disclose that information may render the target subject to criminal prosecution in the UK. However, if the foreign national does comply with the Unexplained Wealth Order (UWO), then that individual may be subject to criminal prosecution in another State… a real Catch 22.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Controversially, there is no need for a foreign national to be accused of money laundering, or any criminality whatsoever, before they could be made subject to a UWO, which would lead to the freezing of their assets, or, worse, criminal prosecution.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The following article introduces UWOs to our clients and examines how one must be careful in weighing up their rights and obligations in respect of the request of a foreign State’s investigative authorities as it may impact their rights in the UAE, and around the GCC.</p>\r\n</br><p dir=\"LTR\" align=\"LEFT\"><strong>What is a UWO?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">On 31st January 2018, the UK introduced their latest attempt at stemming money laundering in the UK: Unexplained Wealth Orders. UWOs are civil investigative powers that are aimed at tackling those who use the UK as a destination for money laundering, or as a destination for those who wish to spend their ill-gotten gains.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">UWOs have been introduced in the UK at a time when London, and the UK, is facing scrutiny as a perceived hotbed of money laundering and revelry. A main proponent of UWOs has been Transparency International UK’s corruption taskforce, who, amongst others, have repeatedly called for greater investigative action to be taken in the UK against individuals and entities thought to have been complicit in corruption, and have led the drive to bring UWOs into action in UK law.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">UWOs are given legal effect pursuant to the UK Proceeds of Crime Act 2002 Article 362A, as introduced by the Criminal Finances Act 2017, and is defined in the legislation as:</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><em>‘An unexplained wealth order is an order requiring the respondent [i.e. the target of the order] to provide a statement—</em></p>\r\n\r\n<ul>\r\n 	<li><em>setting out the nature and extent of the respondent’s interest in the property in respect of which the order is made,</em></li>\r\n 	<li><em>explaining how the respondent obtained the property (including, in particular, how any costs incurred in obtaining it were met),</em></li>\r\n 	<li><em>where the property is held by the trustees of a settlement, setting out such details of the settlement as may be specified in the order, and</em></li>\r\n 	<li><em>setting out such other information in connection with the property as may be so specified.’</em></li>\r\n</ul>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">The clear advantage that UWOs provide for UK investigative authorities is that it is no longer necessary for the UK authorities to demonstrate that an individual has been subject to a conviction for a criminal offence (either in the UK or abroad) in order to obtain information and take measures against a specific property.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Two months after the introduction of the legislation, in March 2018, it would appear that the first orders are now being made. We have seen the first use of these orders, not on a UK national, but on an Asian politician who owns two properties, worth USD $30 million, in the UK. The specific identity of this individual has not been disclosed as matters are ongoing, and no further details are available publically.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">This means that if an individual owns assets in the UK and they are made subject to a UWO, they will be forced to declare how they obtained this asset, and if they fail to do so they would be subject to criminal prosecution by the UK authorities. This may lead to foreign individuals being stuck between a rock and a hard place, with nowhere to turn and no route of escape.</p>\r\n</br><p dir=\"LTR\" align=\"LEFT\"><strong>Why is it Relevant To You?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">As will be apparent from the first orders made against the Asian politician, whilst UWOs do apply to individuals who are reasonably suspected of being involved in crime, the UWOs will also target politically exposed individuals who have not been subject to criminal conviction, or investigation, either in the UK or internationally.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The definition of a PEP, or Politically Exposed Person, varies from State to State, but for the purposes of the UK legislation, the legislators have defined PEPs as the following:</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">‘(a) an individual who is, or has been, entrusted with prominent public functions by an international body or by a State other than the UK or other [European Economic Area] State;</p>\r\n<p dir=\"LTR\" align=\"LEFT\">(b) a family member of a person within paragraph (a); or</p>\r\n<p dir=\"LTR\" align=\"LEFT\">(c) known to be a close associate of a person within […] paragraph [a].’</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">Evidently from this definition, paying particularly close attention to (c) namely ‘a close associate’ of an individual with prominent public functions, there is a very expansive definition of PEP, and this will likely include many unsuspecting individuals. The effect of this definition is that if you are an individual who has prominent public functions, or you are a close associate of another who has been entrusted with public functions, then you may now be targeted by the UK authorities with a UWO. Alarmingly, there is no need for you to have committed a crime, nor to have been suspected of being involved in a crime, for these orders to apply to you.</p>\r\n</br><p dir=\"LTR\" align=\"LEFT\"><strong>Specifically, when could a UWO apply?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">A UK high court judge can give notice of a UWO if the judge is satisfied that it is likely that a foreign PEP (as defined above) is the owner of suspicious wealth in the UK beyond their means, and if all of the following provisions are met:</p>\r\n\r\n<ol>\r\n 	<li dir=\"LTR\">The respondent’s known income is insufficient to obtain the asset; and</li>\r\n 	<li dir=\"LTR\">The value of the asset is greater than £50,000 (approx. AED 260,000).</li>\r\n</ol>\r\n<p dir=\"LTR\" align=\"LEFT\">This legislation does not only target Foreign PEPs, but also where there are reasonable grounds to suspect any individual has been involved in serious crime.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Applications for UWOs may be made without notice. This means that there is no requirement on the UK investigative authority to notify the target of a UWO that they, or their assets, have been made subject of a UWO.</p>\r\n</br><p dir=\"LTR\" align=\"LEFT\"><strong>What assets would this apply to?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">A UWO can be made against assets whose value is greater than £50,000. There is no need for the PEP to be the sole owner of the property whose value is over £50,000, nor is it of relevance if the property was purchased prior to the introduction of the UK legislation.</p>\r\n</br><p dir=\"LTR\" align=\"LEFT\"><strong>What is the effect?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Following the making of an order by the High Court, the Court may order an individual’s property to be frozen, which would preclude the subject of the order from dealing with the property. As these freezing orders may be made without notice, this means that an individual’s assets may be frozen prior to their knowledge of any order being made against them.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The UWO will mandate the individual to explain, at a minimum:</p>\r\n\r\n<ol>\r\n 	<li dir=\"LTR\">The nature and extent of their interest in a particular property; and</li>\r\n 	<li dir=\"LTR\">Explain how the property was obtained.</li>\r\n</ol>\r\n<p dir=\"LTR\" align=\"LEFT\">An explanation will be requested by the UK authorities where ‘there are reasonable grounds to suspect that the respondent’s known lawfully obtained income would be insufficient to allow the respondent to obtain the property’.</p>\r\n</br><p dir=\"LTR\" align=\"LEFT\"><strong>Failing to Comply?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Should the target of a UWO fail to comply with an order, or provide inaccurate or misleading information, then they will likely be subject to criminal sanction in the UK and may face a period of imprisonment and a financial penalty.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Within the legislation, it is stated that a UWO could lead to criminal liability for a target if that individual fails, without reasonable excuse, to comply with the requirements imposed by the Court against that individual. There is no definition of what a reasonable excuse would be in the legislation, and is a subjective requirement that would be decided in Court during the course of litigation.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong><img class=\"wp-image-8014 size-medium alignright\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/Screen-Shot-2018-07-31-at-5.43.01-PM-242x300.png\" alt=\"\" width=\"242\" height=\"300\" /></br>A View from the East: Stuck between a Rock and a Hard Place?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">These orders, whilst designed to tackle money laundering on a global scale, and limit the use of the UK jurisdiction for those who seek to gain from their ill-gotten earnings, may cause legal difficulties for individuals based in foreign jurisdictions who are subject to UWOs – such as the UAE and the wider GCC – due to a conflict of laws between this UK legislation and that of other countries. This conflict could lead to an individual’s adherence to UK legislation meaning that the individual would be liable to prosecution in other jurisdictions.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Taking the UAE as a representative example of the Middle East’s approach to confidential or private information, the UAE’s jurisdiction imposes very strict obligations on an individual’s use and disclosure of confidential information. It is a criminal offence, pursuant to the UAE’s Federal Law No. 3 of 1987, as amended by Federal Decree No. 7 of 2016 (UAE Penal Code) to disclose secret information. Secret information is afforded an expansive definition in the UAE Penal Code and it is commonly viewed any information that is confidential, i.e. not in the public domain, and that an individual possesses due to their employment or individual nature.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Furthermore, due to the extraterritorial nature of the UAE Penal Code, should an individual commit a crime that is wholly or partly committed within the UAE, then that individual would be bound by the provisions of the Penal Code, and would be bound by provisions such as the disclosure of secret information. Specifically, should an individual be requested to provide secret information, such as the source of funds from a business entity, to the UK authorities, and that information relates to a UAE business or UAE based individual, then if the material or information is disclosed following a UWO in the UK, then in the UAE the individual may be subject to criminal prosecution for disclosing that exact information.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">There is no exception afforded under UAE domestic legislation that would permit an individual to disclose confidential information to a foreign investigative authority (such as the UK’s Serious Fraud Office, Financial Conduct Authority, or National Security Agency). Should that individual disclose such information to the UK’s, or any other foreign State’s, investigative authority, then that individual may be liable to prosecution in the UAE in the same manner as though the disclosure had been made to a private individual or entity.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Prosecution for disclosing confidential information is a serious offence in the UAE, and one that may carry a mandatory minimum period of imprisonment. Accordingly, the stakes are very high when one is subject to an international request for judicial assistance, in any form, and it is for that reason and in order to assist with international criminal investigations that the UAE has entered into number multilateral and bilateral treaties aimed at assisting mutual judicial assistance requests. As with most international requests from law enforcement agencies, such requests should follow the usual diplomatic channels through the deployment of letters rogatory.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The difficulties for UAE individuals would not stop simply at the threat of criminal sanction, but also according to the UAE’s Labour Law, should an individual disclose the secrets of their employer, then the worker may be dismissed without notice and forfeit their entire severance pay.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Accordingly, the receipt of a UWO in the UK demanding that an individual provide information to the UAE authorities may conflict with the statutory protection relating to confidential information (or other laws) in a foreign jurisdiction, such as the UAE. This would lead to the precarious situation where an individual may face prosecution in the UK if he doesn’t comply with the UWO, but criminal prosecution in the UAE if he does comply.</p>\r\n</br><p dir=\"LTR\" align=\"LEFT\"><strong>Conclusion</strong></p>\r\nThe above example and review provides a very high-level overview of the competing laws that the UK’s UWOs may catch. Whilst the UK legislation will no doubt serve as an effective deterrent and useful tool in minimising global money laundering, and limiting the attraction of the UK for criminals, it may have unintended consequences for foreign nationals holding legitimate assets in the UK. Prior to making any response to a request for assistance, it is imperative that the recipient apprise themselves of all legal considerations to ensure that they are not jumping out of the frying pan, but straight into the fire.'),
(260841, 25303, 'MetaLink', 'content'),
(260842, 25303, 'EditorLinkPost', 'https://www.tamimi.com/wp-admin/post.php?post=7940&amp;action=edit');
INSERT INTO `tm_wsal_metadata` (`id`, `occurrence_id`, `name`, `value`) VALUES
(260843, 25303, 'ReportText', '<p dir=\"LTR\" align=\"LEFT\"><img class=\"alignleft size-full wp-image-8002\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/17-1.png\" alt=\"\" width=\"3567\" height=\"715\" /></p>\r\n</br><p>The UK legislature has recently introduced domestic legislation aimed at money launderers, potentially resulting in unintended consequences for foreign nationals who have legitimate assets in the UK. These orders demand the intended target provide information about the origin of their wealth, and refusal to disclose that information may render the target subject to criminal prosecution in the UK. However, if the foreign national does comply with the Unexplained Wealth Order (UWO), then that individual may be subject to criminal prosecution in another State… a real Catch 22.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Controversially, there is no need for a foreign national to be accused of money laundering, or any criminality whatsoever, before they could be made subject to a UWO, which would lead to the freezing of their assets, or, worse, criminal prosecution.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The following article introduces UWOs to our clients and examines how one must be careful in weighing up their rights and obligations in respect of the request of a foreign State’s investigative authorities as it may impact their rights in the UAE, and around the GCC.</p>\r\n</br><p dir=\"LTR\" align=\"LEFT\"><strong>What is a UWO?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">On 31st January 2018, the UK introduced their latest attempt at stemming money laundering in the UK: Unexplained Wealth Orders. UWOs are civil investigative powers that are aimed at tackling those who use the UK as a destination for money laundering, or as a destination for those who wish to spend their ill-gotten gains.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">UWOs have been introduced in the UK at a time when London, and the UK, is facing scrutiny as a perceived hotbed of money laundering and revelry. A main proponent of UWOs has been Transparency International UK’s corruption taskforce, who, amongst others, have repeatedly called for greater investigative action to be taken in the UK against individuals and entities thought to have been complicit in corruption, and have led the drive to bring UWOs into action in UK law.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">UWOs are given legal effect pursuant to the UK Proceeds of Crime Act 2002 Article 362A, as introduced by the Criminal Finances Act 2017, and is defined in the legislation as:</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><em>‘An unexplained wealth order is an order requiring the respondent [i.e. the target of the order] to provide a statement—</em></p>\r\n\r\n<ul>\r\n 	<li><em>setting out the nature and extent of the respondent’s interest in the property in respect of which the order is made,</em></li>\r\n 	<li><em>explaining how the respondent obtained the property (including, in particular, how any costs incurred in obtaining it were met),</em></li>\r\n 	<li><em>where the property is held by the trustees of a settlement, setting out such details of the settlement as may be specified in the order, and</em></li>\r\n 	<li><em>setting out such other information in connection with the property as may be so specified.’</em></li>\r\n</ul>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">The clear advantage that UWOs provide for UK investigative authorities is that it is no longer necessary for the UK authorities to demonstrate that an individual has been subject to a conviction for a criminal offence (either in the UK or abroad) in order to obtain information and take measures against a specific property.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Two months after the introduction of the legislation, in March 2018, it would appear that the first orders are now being made. We have seen the first use of these orders, not on a UK national, but on an Asian politician who owns two properties, worth USD $30 million, in the UK. The specific identity of this individual has not been disclosed as matters are ongoing, and no further details are available publically.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">This means that if an individual owns assets in the UK and they are made subject to a UWO, they will be forced to declare how they obtained this asset, and if they fail to do so they would be subject to criminal prosecution by the UK authorities. This may lead to foreign individuals being stuck between a rock and a hard place, with nowhere to turn and no route of escape.</p>\r\n</br><p dir=\"LTR\" align=\"LEFT\"><strong>Why is it Relevant To You?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">As will be apparent from the first orders made against the Asian politician, whilst UWOs do apply to individuals who are reasonably suspected of being involved in crime, the UWOs will also target politically exposed individuals who have not been subject to criminal conviction, or investigation, either in the UK or internationally.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The definition of a PEP, or Politically Exposed Person, varies from State to State, but for the purposes of the UK legislation, the legislators have defined PEPs as the following:</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">‘(a) an individual who is, or has been, entrusted with prominent public functions by an international body or by a State other than the UK or other [European Economic Area] State;</p>\r\n<p dir=\"LTR\" align=\"LEFT\">(b) a family member of a person within paragraph (a); or</p>\r\n<p dir=\"LTR\" align=\"LEFT\">(c) known to be a close associate of a person within […] paragraph [a].’</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">Evidently from this definition, paying particularly close attention to (c) namely ‘a close associate’ of an individual with prominent public functions, there is a very expansive definition of PEP, and this will likely include many unsuspecting individuals. The effect of this definition is that if you are an individual who has prominent public functions, or you are a close associate of another who has been entrusted with public functions, then you may now be targeted by the UK authorities with a UWO. Alarmingly, there is no need for you to have committed a crime, nor to have been suspected of being involved in a crime, for these orders to apply to you.</p>\r\n</br><p dir=\"LTR\" align=\"LEFT\"><strong>Specifically, when could a UWO apply?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">A UK high court judge can give notice of a UWO if the judge is satisfied that it is likely that a foreign PEP (as defined above) is the owner of suspicious wealth in the UK beyond their means, and if all of the following provisions are met:</p>\r\n\r\n<ol>\r\n 	<li dir=\"LTR\">The respondent’s known income is insufficient to obtain the asset; and</li>\r\n 	<li dir=\"LTR\">The value of the asset is greater than £50,000 (approx. AED 260,000).</li>\r\n</ol>\r\n<p dir=\"LTR\" align=\"LEFT\">This legislation does not only target Foreign PEPs, but also where there are reasonable grounds to suspect any individual has been involved in serious crime.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Applications for UWOs may be made without notice. This means that there is no requirement on the UK investigative authority to notify the target of a UWO that they, or their assets, have been made subject of a UWO.</p>\r\n</br><p dir=\"LTR\" align=\"LEFT\"><strong>What assets would this apply to?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">A UWO can be made against assets whose value is greater than £50,000. There is no need for the PEP to be the sole owner of the property whose value is over £50,000, nor is it of relevance if the property was purchased prior to the introduction of the UK legislation.</p>\r\n</br><p dir=\"LTR\" align=\"LEFT\"><strong>What is the effect?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Following the making of an order by the High Court, the Court may order an individual’s property to be frozen, which would preclude the subject of the order from dealing with the property. As these freezing orders may be made without notice, this means that an individual’s assets may be frozen prior to their knowledge of any order being made against them.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The UWO will mandate the individual to explain, at a minimum:</p>\r\n\r\n<ol>\r\n 	<li dir=\"LTR\">The nature and extent of their interest in a particular property; and</li>\r\n 	<li dir=\"LTR\">Explain how the property was obtained.</li>\r\n</ol>\r\n<p dir=\"LTR\" align=\"LEFT\">An explanation will be requested by the UK authorities where ‘there are reasonable grounds to suspect that the respondent’s known lawfully obtained income would be insufficient to allow the respondent to obtain the property’.</p>\r\n</br><p dir=\"LTR\" align=\"LEFT\"><strong>Failing to Comply?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Should the target of a UWO fail to comply with an order, or provide inaccurate or misleading information, then they will likely be subject to criminal sanction in the UK and may face a period of imprisonment and a financial penalty.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Within the legislation, it is stated that a UWO could lead to criminal liability for a target if that individual fails, without reasonable excuse, to comply with the requirements imposed by the Court against that individual. There is no definition of what a reasonable excuse would be in the legislation, and is a subjective requirement that would be decided in Court during the course of litigation.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong><img class=\"wp-image-8014 size-medium alignright\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/Screen-Shot-2018-07-31-at-5.43.01-PM-242x300.png\" alt=\"\" width=\"242\" height=\"300\" /></br>A View from the East: Stuck between a Rock and a Hard Place?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">These orders, whilst designed to tackle money laundering on a global scale, and limit the use of the UK jurisdiction for those who seek to gain from their ill-gotten earnings, may cause legal difficulties for individuals based in foreign jurisdictions who are subject to UWOs – such as the UAE and the wider GCC – due to a conflict of laws between this UK legislation and that of other countries. This conflict could lead to an individual’s adherence to UK legislation meaning that the individual would be liable to prosecution in other jurisdictions.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Taking the UAE as a representative example of the Middle East’s approach to confidential or private information, the UAE’s jurisdiction imposes very strict obligations on an individual’s use and disclosure of confidential information. It is a criminal offence, pursuant to the UAE’s Federal Law No. 3 of 1987, as amended by Federal Decree No. 7 of 2016 (UAE Penal Code) to disclose secret information. Secret information is afforded an expansive definition in the UAE Penal Code and it is commonly viewed any information that is confidential, i.e. not in the public domain, and that an individual possesses due to their employment or individual nature.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Furthermore, due to the extraterritorial nature of the UAE Penal Code, should an individual commit a crime that is wholly or partly committed within the UAE, then that individual would be bound by the provisions of the Penal Code, and would be bound by provisions such as the disclosure of secret information. Specifically, should an individual be requested to provide secret information, such as the source of funds from a business entity, to the UK authorities, and that information relates to a UAE business or UAE based individual, then if the material or information is disclosed following a UWO in the UK, then in the UAE the individual may be subject to criminal prosecution for disclosing that exact information.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">There is no exception afforded under UAE domestic legislation that would permit an individual to disclose confidential information to a foreign investigative authority (such as the UK’s Serious Fraud Office, Financial Conduct Authority, or National Security Agency). Should that individual disclose such information to the UK’s, or any other foreign State’s, investigative authority, then that individual may be liable to prosecution in the UAE in the same manner as though the disclosure had been made to a private individual or entity.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Prosecution for disclosing confidential information is a serious offence in the UAE, and one that may carry a mandatory minimum period of imprisonment. Accordingly, the stakes are very high when one is subject to an international request for judicial assistance, in any form, and it is for that reason and in order to assist with international criminal investigations that the UAE has entered into number multilateral and bilateral treaties aimed at assisting mutual judicial assistance requests. As with most international requests from law enforcement agencies, such requests should follow the usual diplomatic channels through the deployment of letters rogatory.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The difficulties for UAE individuals would not stop simply at the threat of criminal sanction, but also according to the UAE’s Labour Law, should an individual disclose the secrets of their employer, then the worker may be dismissed without notice and forfeit their entire severance pay.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Accordingly, the receipt of a UWO in the UK demanding that an individual provide information to the UAE authorities may conflict with the statutory protection relating to confidential information (or other laws) in a foreign jurisdiction, such as the UAE. This would lead to the precarious situation where an individual may face prosecution in the UK if he doesn’t comply with the UWO, but criminal prosecution in the UAE if he does comply.</p>\r\n</br><p dir=\"LTR\" align=\"LEFT\"><strong>Conclusion</strong></p>\r\nThe above example and review provides a very high-level overview of the competing laws that the UK’s UWOs may catch. Whilst the UK legislation will no doubt serve as an effective deterrent and useful tool in minimising global money laundering, and limiting the attraction of the UK for criminals, it may have unintended consequences for foreign nationals holding legitimate assets in the UK. Prior to making any response to a request for assistance, it is imperative that the recipient apprise themselves of all legal considerations to ensure that they are not jumping out of the frying pan, but straight into the fire.|<p dir=\"LTR\" align=\"LEFT\"><img class=\"alignleft size-full wp-image-8002\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/17-1.png\" alt=\"\" width=\"3567\" height=\"715\" /></p>\r\n</br>The UK legislature has recently introduced domestic legislation aimed at money launderers, potentially resulting in unintended consequences for foreign nationals who have legitimate assets in the UK. These orders demand the intended target provide information about the origin of their wealth, and refusal to disclose that information may render the target subject to criminal prosecution in the UK. However, if the foreign national does comply with the Unexplained Wealth Order (UWO), then that individual may be subject to criminal prosecution in another State… a real Catch 22.\r\n<p dir=\"LTR\" align=\"LEFT\">Controversially, there is no need for a foreign national to be accused of money laundering, or any criminality whatsoever, before they could be made subject to a UWO, which would lead to the freezing of their assets, or, worse, criminal prosecution.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The following article introduces UWOs to our clients and examines how one must be careful in weighing up their rights and obligations in respect of the request of a foreign State’s investigative authorities as it may impact their rights in the UAE, and around the GCC.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What is a UWO?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">On 31st January 2018, the UK introduced their latest attempt at stemming money laundering in the UK: Unexplained Wealth Orders. UWOs are civil investigative powers that are aimed at tackling those who use the UK as a destination for money laundering, or as a destination for those who wish to spend their ill-gotten gains.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">UWOs have been introduced in the UK at a time when London, and the UK, is facing scrutiny as a perceived hotbed of money laundering and revelry. A main proponent of UWOs has been Transparency International UK’s corruption taskforce, who, amongst others, have repeatedly called for greater investigative action to be taken in the UK against individuals and entities thought to have been complicit in corruption, and have led the drive to bring UWOs into action in UK law.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">UWOs are given legal effect pursuant to the UK Proceeds of Crime Act 2002 Article 362A, as introduced by the Criminal Finances Act 2017, and is defined in the legislation as:</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><em>‘An unexplained wealth order is an order requiring the respondent [i.e. the target of the order] to provide a statement—</em></p>\r\n\r\n<ul>\r\n 	<li><em>setting out the nature and extent of the respondent’s interest in the property in respect of which the order is made,</em></li>\r\n 	<li><em>explaining how the respondent obtained the property (including, in particular, how any costs incurred in obtaining it were met),</em></li>\r\n 	<li><em>where the property is held by the trustees of a settlement, setting out such details of the settlement as may be specified in the order, and</em></li>\r\n 	<li><em>setting out such other information in connection with the property as may be so specified.’</em></li>\r\n</ul>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">The clear advantage that UWOs provide for UK investigative authorities is that it is no longer necessary for the UK authorities to demonstrate that an individual has been subject to a conviction for a criminal offence (either in the UK or abroad) in order to obtain information and take measures against a specific property.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Two months after the introduction of the legislation, in March 2018, it would appear that the first orders are now being made. We have seen the first use of these orders, not on a UK national, but on an Asian politician who owns two properties, worth USD $30 million, in the UK. The specific identity of this individual has not been disclosed as matters are ongoing, and no further details are available publically.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">This means that if an individual owns assets in the UK and they are made subject to a UWO, they will be forced to declare how they obtained this asset, and if they fail to do so they would be subject to criminal prosecution by the UK authorities. This may lead to foreign individuals being stuck between a rock and a hard place, with nowhere to turn and no route of escape.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Why is it Relevant To You?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">As will be apparent from the first orders made against the Asian politician, whilst UWOs do apply to individuals who are reasonably suspected of being involved in crime, the UWOs will also target politically exposed individuals who have not been subject to criminal conviction, or investigation, either in the UK or internationally.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The definition of a PEP, or Politically Exposed Person, varies from State to State, but for the purposes of the UK legislation, the legislators have defined PEPs as the following:</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">‘(a) an individual who is, or has been, entrusted with prominent public functions by an international body or by a State other than the UK or other [European Economic Area] State;</p>\r\n<p dir=\"LTR\" align=\"LEFT\">(b) a family member of a person within paragraph (a); or</p>\r\n<p dir=\"LTR\" align=\"LEFT\">(c) known to be a close associate of a person within […] paragraph [a].’</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">Evidently from this definition, paying particularly close attention to (c) namely ‘a close associate’ of an individual with prominent public functions, there is a very expansive definition of PEP, and this will likely include many unsuspecting individuals. The effect of this definition is that if you are an individual who has prominent public functions, or you are a close associate of another who has been entrusted with public functions, then you may now be targeted by the UK authorities with a UWO. Alarmingly, there is no need for you to have committed a crime, nor to have been suspected of being involved in a crime, for these orders to apply to you.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Specifically, when could a UWO apply?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">A UK high court judge can give notice of a UWO if the judge is satisfied that it is likely that a foreign PEP (as defined above) is the owner of suspicious wealth in the UK beyond their means, and if all of the following provisions are met:</p>\r\n\r\n<ol>\r\n 	<li dir=\"LTR\">The respondent’s known income is insufficient to obtain the asset; and</li>\r\n 	<li dir=\"LTR\">The value of the asset is greater than £50,000 (approx. AED 260,000).</li>\r\n</ol>\r\n<p dir=\"LTR\" align=\"LEFT\">This legislation does not only target Foreign PEPs, but also where there are reasonable grounds to suspect any individual has been involved in serious crime.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Applications for UWOs may be made without notice. This means that there is no requirement on the UK investigative authority to notify the target of a UWO that they, or their assets, have been made subject of a UWO.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What assets would this apply to?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">A UWO can be made against assets whose value is greater than £50,000. There is no need for the PEP to be the sole owner of the property whose value is over £50,000, nor is it of relevance if the property was purchased prior to the introduction of the UK legislation.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What is the effect?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Following the making of an order by the High Court, the Court may order an individual’s property to be frozen, which would preclude the subject of the order from dealing with the property. As these freezing orders may be made without notice, this means that an individual’s assets may be frozen prior to their knowledge of any order being made against them.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The UWO will mandate the individual to explain, at a minimum:</p>\r\n\r\n<ol>\r\n 	<li dir=\"LTR\">The nature and extent of their interest in a particular property; and</li>\r\n 	<li dir=\"LTR\">Explain how the property was obtained.</li>\r\n</ol>\r\n<p dir=\"LTR\" align=\"LEFT\">An explanation will be requested by the UK authorities where ‘there are reasonable grounds to suspect that the respondent’s known lawfully obtained income would be insufficient to allow the respondent to obtain the property’.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Failing to Comply?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Should the target of a UWO fail to comply with an order, or provide inaccurate or misleading information, then they will likely be subject to criminal sanction in the UK and may face a period of imprisonment and a financial penalty.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Within the legislation, it is stated that a UWO could lead to criminal liability for a target if that individual fails, without reasonable excuse, to comply with the requirements imposed by the Court against that individual. There is no definition of what a reasonable excuse would be in the legislation, and is a subjective requirement that would be decided in Court during the course of litigation.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong><img class=\"wp-image-8014 size-medium alignright\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/Screen-Shot-2018-07-31-at-5.43.01-PM-242x300.png\" alt=\"\" width=\"242\" height=\"300\" />A View from the East: Stuck between a Rock and a Hard Place?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">These orders, whilst designed to tackle money laundering on a global scale, and limit the use of the UK jurisdiction for those who seek to gain from their ill-gotten earnings, may cause legal difficulties for individuals based in foreign jurisdictions who are subject to UWOs – such as the UAE and the wider GCC – due to a conflict of laws between this UK legislation and that of other countries. This conflict could lead to an individual’s adherence to UK legislation meaning that the individual would be liable to prosecution in other jurisdictions.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Taking the UAE as a representative example of the Middle East’s approach to confidential or private information, the UAE’s jurisdiction imposes very strict obligations on an individual’s use and disclosure of confidential information. It is a criminal offence, pursuant to the UAE’s Federal Law No. 3 of 1987, as amended by Federal Decree No. 7 of 2016 (UAE Penal Code) to disclose secret information. Secret information is afforded an expansive definition in the UAE Penal Code and it is commonly viewed any information that is confidential, i.e. not in the public domain, and that an individual possesses due to their employment or individual nature.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Furthermore, due to the extraterritorial nature of the UAE Penal Code, should an individual commit a crime that is wholly or partly committed within the UAE, then that individual would be bound by the provisions of the Penal Code, and would be bound by provisions such as the disclosure of secret information. Specifically, should an individual be requested to provide secret information, such as the source of funds from a business entity, to the UK authorities, and that information relates to a UAE business or UAE based individual, then if the material or information is disclosed following a UWO in the UK, then in the UAE the individual may be subject to criminal prosecution for disclosing that exact information.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">There is no exception afforded under UAE domestic legislation that would permit an individual to disclose confidential information to a foreign investigative authority (such as the UK’s Serious Fraud Office, Financial Conduct Authority, or National Security Agency). Should that individual disclose such information to the UK’s, or any other foreign State’s, investigative authority, then that individual may be liable to prosecution in the UAE in the same manner as though the disclosure had been made to a private individual or entity.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Prosecution for disclosing confidential information is a serious offence in the UAE, and one that may carry a mandatory minimum period of imprisonment. Accordingly, the stakes are very high when one is subject to an international request for judicial assistance, in any form, and it is for that reason and in order to assist with international criminal investigations that the UAE has entered into number multilateral and bilateral treaties aimed at assisting mutual judicial assistance requests. As with most international requests from law enforcement agencies, such requests should follow the usual diplomatic channels through the deployment of letters rogatory.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The difficulties for UAE individuals would not stop simply at the threat of criminal sanction, but also according to the UAE’s Labour Law, should an individual disclose the secrets of their employer, then the worker may be dismissed without notice and forfeit their entire severance pay.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Accordingly, the receipt of a UWO in the UK demanding that an individual provide information to the UAE authorities may conflict with the statutory protection relating to confidential information (or other laws) in a foreign jurisdiction, such as the UAE. This would lead to the precarious situation where an individual may face prosecution in the UK if he doesn’t comply with the UWO, but criminal prosecution in the UAE if he does comply.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Conclusion</strong></p>\r\nThe above example and review provides a very high-level overview of the competing laws that the UK’s UWOs may catch. Whilst the UK legislation will no doubt serve as an effective deterrent and useful tool in minimising global money laundering, and limiting the attraction of the UK for criminals, it may have unintended consequences for foreign nationals holding legitimate assets in the UK. Prior to making any response to a request for assistance, it is imperative that the recipient apprise themselves of all legal considerations to ensure that they are not jumping out of the frying pan, but straight into the fire.'),
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(260892, 25308, 'PostID', '7957'),
(260893, 25308, 'PostTitle', 'Catching the wave: New Data Protection Law in Bahrain'),
(260894, 25308, 'PostStatus', 'publish'),
(260895, 25308, 'PostType', 'law_update_articles'),
(260896, 25308, 'PostDate', '2018-08-01 07:45:44'),
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(260900, 25308, 'MetaValueNew', '<p dir=\"LTR\" align=\"LEFT\"><img class=\"size-full wp-image-8044 alignnone\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/cvdfd.jpg\" alt=\"\" width=\"6000\" height=\"2401\" /></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Bahrain’s Law on the Protection of Personal Data was published on 19 July 2018, and will come into effect on 1 August 2019. The Law will require a variety of changes to the way businesses process personal data in Bahrain or about residents of Bahrain. Data protection has not been a high priority topic for most businesses in Bahrain, with the limited exception of international entities subject to data protection requirements in other jurisdictions in which they operate. While the publication of the new Law provides a considerable lead-in period within which entities subject to the Law will need to comply, the fact that the Law creates criminal offences means that compliance is all the more important and should be treated as a high priority.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Until now, and with one exception (namely, Qatar), none of the Gulf Cooperation Council member states had a modern, nationally applicable data protection law. Legal issues relating to privacy and data protection are typically analysed in terms of general, and ill-fitting, criminal provisions relating to the unauthorized disclosure of secrets, or – in appropriate circumstances - industry-specific obligations relating to healthcare or credit data, or telecommunications sector subscriber data.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law is generally composed of 60 articles divided into three broad sections or ‘titles’. These are:</p>\r\n\r\n<ul>\r\n 	<li dir=\"LTR\">Title 1: Processing Provisions – Including definitions and general rules for the legality of processing, controls of data processing and transfer, statements as well as the rights of the data holder.</li>\r\n 	<li dir=\"LTR\">Title 2: Data Protection Authority - Including provisions relating to the establishment of the regulator, and its rights and responsibilities.</li>\r\n 	<li dir=\"LTR\">Title 3: Accountability of the data manager (data controller) and data processor – Including provisions relating to accountability to the regulator, investigation procedures, civil and criminal liability, and penalties for violation.</li>\r\n</ul>\r\n<p dir=\"LTR\" align=\"LEFT\">In this article, we consider some key areas addressed in the Data Protection Law.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Application</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Bahrain’s Data Protection Law describes the legal protection of personal privacy as among the main constitutional rights of the person, and notes that it should be protected, particularly in the context of the increasing use of electronic/digital means for processing information.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law applies to:</p>\r\n\r\n<ul>\r\n 	<li dir=\"LTR\">Every individual residing normally in Bahrain or having a workplace in Bahrain, and every legal person (corporate) having a place of business in the Kingdom of Bahrain; and</li>\r\n 	<li dir=\"LTR\">Every individual not residing normally in Bahrain or having a workplace in Bahrain, and every legal person (corporate) not having a place of business in the Kingdom of Bahrain, where such persons are processing data using means available in Bahrain, except where such processing means are solely for the purpose of passing data through Bahrain.</li>\r\n</ul>\r\n<p dir=\"LTR\" align=\"LEFT\">In this latter scenario, the legal person (corporate) is required to appoint an authorized representative in Bahrain, and notify the Authority of such appointment. This provision would appear to affect, for example, corporate customers of cloud service providers, where the customer is based outside Bahrain, and the services being provided to the customer are being provided from data centres located in Bahrain.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Criminal provisions</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law criminalizes a variety of acts that would, at most, be the subject of administrative penalties in data protection laws elsewhere. Penalties generally comprise up to one year in prison and/or a fine of between BHD1,000 and BHD20,000 (between about USD 2,600 to about USD 53,000) (or a fine only in the case of corporate entities). The following are examples of activities that attract criminal penalties under the Law:</p>\r\n\r\n<ul>\r\n 	<li dir=\"LTR\">processing sensitive personal data in violation of the provision specifying requirements for processing sensitive personal data;</li>\r\n 	<li dir=\"LTR\">transferring personal data outside Bahrain contrary to the provisions specifying requirements for transfers to jurisdictions that provide an adequate level of data protection, and associated exceptions;</li>\r\n 	<li dir=\"LTR\">processing personal data without notifying the Authority in accordance with the provision that sets out the obligation to notify the Authority before commencing any data processing activities (except where certain exceptions apply), or failing to update such notification to the Authority;</li>\r\n 	<li dir=\"LTR\">Processing personal data contrary to the provision that requires prior authorization from the Authority before processing personal data in certain circumstances;</li>\r\n 	<li dir=\"LTR\">Providing false or misleading information to the Authority or to a data subject, or withholding relevant information from the Authority, or otherwise hindering the Authority’s work; and</li>\r\n 	<li dir=\"LTR\">Disclosing any data or information accessed due to work, or using the same for own benefit or for the benefit of others unreasonably and in violation of the provisions of this law.</li>\r\n</ul>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Security considerations</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\"><img class=\"wp-image-8068 alignright\" src=\"http://www.tamimi.com/wp-content/uploads/2018/08/56.jpg\" alt=\"\" width=\"489\" height=\"326\" />Generally, the security of processing provisions, and the confidentiality provisions, appear to be fairly standard.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Data controllers are required to apply technical and organizational measures capable of protecting personal data against unintentional or unauthorized destruction, accidental loss, unauthorized alteration, disclosure or access, or any other form of processing. The measures adopted need to be appropriate, bearing in mind the nature of the data in question and the risks associated with processing it. The Law also indicates that ‘state-of-the-art’ technological protection measures should be adopted, but this is tempered by reference to the costs arising from use of such technology.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Additionally, the Law contemplates the issuance of a regulation specifying requirements that technical and organisational measures must satisfy. It also provides scope for specific requirements to be prescribed in such regulations.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Data controllers are required to maintain documentation that reflects the technical and organizational measures adopted. This documentation must be available for viewing by the parties concerned (presumably, including data subjects), as well as the Authority, any data processors, and the data controller itself.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">With regard to processing by data processors, the Law requires data controllers to engage only data processors who provide sufficient guarantees regarding the application of technical and organisational measures. Importantly, there is an obligation on data controllers to take steps to verify compliance with such measures, and to enter into a written contract with the data processor requiring that the data processor shall only process data in accordance with the instructions of the data controller, and in accordance with the data controller’s requirements with regard to security and confidentiality.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">There does not appear to be any specific obligation to notify the Authority in the event of a data breach incident. It is possible that this level of detail might be addressed in the regulations, or that the Authority is expected to address breaches only in the event that they become aware of them, and the circumstances indicate a breach of the obligation to use suitable technical and organizational security measures.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Data protection supervisor</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law contemplates a role of ‘Data Protection Supervisor’ (which is not a data protection officer) intended to act as an independent and impartial intermediary between the data controller and the Authority.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The data protection supervisor will help the data controller fulfil its rights and obligations, and coordinate between the data controller and the Authority. It will also be required to verify the data controller’s processing in compliance with the law, alert the data controller to any apparent non-compliance to enable the issue to be addressed, and alert the Authority where such non-compliance has not been addressed within a specified timeframe. The data protection supervisor will also be required to maintain a register of the data controller’s processing operations that the data controller must notify the Authority, and update the Authority of the same on a monthly basis. (If no data protection supervisor is appointed, then the data controller is required to do this itself.)</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The qualifications and requirements for registration as a data protection supervisor will be officially issued, and data protection supervisors will need to be registered on a register maintained by the Authority. The requirement to appoint a data protection supervisor is optional, although it may be made compulsory for specific categories of data controllers.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The concept of a data protection supervisor has the potential to result in a whole new industry in the Bahrain market. The regulations setting out the requirements for the registration of data protection supervisors may shed greater light on what is anticipated, in terms of who might be able to fulfil such roles. The most natural development may be for the role to be filled by consulting/audit firms with expertise in data protection related issues.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Conclusion</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Bahrain’s new Data Protection Law will require a great deal of attention from businesses operating in Bahrain. Data protection has not been a high priority topic for most businesses in Bahrain, with the limited exception of international entities subject to data protection requirements in other jurisdictions in which they operate. While the publication of the new Law will result in some degree of a lead-in period within which entities subject to the Law will need to comply, the fact that the Law creates criminal offences means that compliance is all the more important and should be treated as a high priority.</p>');
INSERT INTO `tm_wsal_metadata` (`id`, `occurrence_id`, `name`, `value`) VALUES
(260901, 25308, 'MetaValueOld', '<p dir=\"LTR\" align=\"LEFT\"><img class=\"size-full wp-image-8044 alignnone\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/cvdfd.jpg\" alt=\"\" width=\"6000\" height=\"2401\" /></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Bahrain’s Law on the Protection of Personal Data was published on 19 July 2018, and will come into effect on 1 August 2019. The Law will require a variety of changes to the way businesses process personal data in Bahrain or about residents of Bahrain. Data protection has not been a high priority topic for most businesses in Bahrain, with the limited exception of international entities subject to data protection requirements in other jurisdictions in which they operate. While the publication of the new Law provides a considerable lead-in period within which entities subject to the Law will need to comply, the fact that the Law creates criminal offences means that compliance is all the more important and should be treated as a high priority.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Until now, and with one exception (namely, Qatar), none of the Gulf Cooperation Council member states had a modern, nationally applicable data protection law. Legal issues relating to privacy and data protection are typically analysed in terms of general, and ill-fitting, criminal provisions relating to the unauthorized disclosure of secrets, or – in appropriate circumstances - industry-specific obligations relating to healthcare or credit data, or telecommunications sector subscriber data.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law is generally composed of 60 articles divided into three broad sections or ‘titles’. These are:</p>\r\n\r\n<ul>\r\n 	<li dir=\"LTR\">Title 1: Processing Provisions – Including definitions and general rules for the legality of processing, controls of data processing and transfer, statements as well as the rights of the data holder.</li>\r\n 	<li dir=\"LTR\">Title 2: Data Protection Authority - Including provisions relating to the establishment of the regulator, and its rights and responsibilities.</li>\r\n 	<li dir=\"LTR\">Title 3: Accountability of the data manager (data controller) and data processor – Including provisions relating to accountability to the regulator, investigation procedures, civil and criminal liability, and penalties for violation.</li>\r\n</ul>\r\n<p dir=\"LTR\" align=\"LEFT\">In this article, we consider some key areas addressed in the Data Protection Law.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Application</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Bahrain’s Data Protection Law describes the legal protection of personal privacy as among the main constitutional rights of the person, and notes that it should be protected, particularly in the context of the increasing use of electronic/digital means for processing information.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law applies to:</p>\r\n\r\n<ul>\r\n 	<li dir=\"LTR\">Every individual residing normally in Bahrain or having a workplace in Bahrain, and every legal person (corporate) having a place of business in the Kingdom of Bahrain; and</li>\r\n 	<li dir=\"LTR\">Every individual not residing normally in Bahrain or having a workplace in Bahrain, and every legal person (corporate) not having a place of business in the Kingdom of Bahrain, where such persons are processing data using means available in Bahrain, except where such processing means are solely for the purpose of passing data through Bahrain.</li>\r\n</ul>\r\n<p dir=\"LTR\" align=\"LEFT\">In this latter scenario, the legal person (corporate) is required to appoint an authorized representative in Bahrain, and notify the Authority of such appointment. This provision would appear to affect, for example, corporate customers of cloud service providers, where the customer is based outside Bahrain, and the services being provided to the customer are being provided from data centres located in Bahrain.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Criminal provisions</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law criminalizes a variety of acts that would, at most, be the subject of administrative penalties in data protection laws elsewhere. Penalties generally comprise up to one year in prison and/or a fine of between BHD1,000 and BHD20,000 (between about USD 2,600 to about USD 53,000) (or a fine only in the case of corporate entities). The following are examples of activities that attract criminal penalties under the Law:</p>\r\n\r\n<ul>\r\n 	<li dir=\"LTR\">processing sensitive personal data in violation of the provision specifying requirements for processing sensitive personal data;</li>\r\n 	<li dir=\"LTR\">transferring personal data outside Bahrain contrary to the provisions specifying requirements for transfers to jurisdictions that provide an adequate level of data protection, and associated exceptions;</li>\r\n 	<li dir=\"LTR\">processing personal data without notifying the Authority in accordance with the provision that sets out the obligation to notify the Authority before commencing any data processing activities (except where certain exceptions apply), or failing to update such notification to the Authority;</li>\r\n 	<li dir=\"LTR\">Processing personal data contrary to the provision that requires prior authorization from the Authority before processing personal data in certain circumstances;</li>\r\n 	<li dir=\"LTR\">Providing false or misleading information to the Authority or to a data subject, or withholding relevant information from the Authority, or otherwise hindering the Authority’s work; and</li>\r\n 	<li dir=\"LTR\">Disclosing any data or information accessed due to work, or using the same for own benefit or for the benefit of others unreasonably and in violation of the provisions of this law.</li>\r\n</ul>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Security considerations</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\"><img class=\"wp-image-8068 alignleft\" src=\"http://www.tamimi.com/wp-content/uploads/2018/08/56.jpg\" alt=\"\" width=\"374\" height=\"249\" />Generally, the security of processing provisions, and the confidentiality provisions, appear to be fairly standard.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Data controllers are required to apply technical and organizational measures capable of protecting personal data against unintentional or unauthorized destruction, accidental loss, unauthorized alteration, disclosure or access, or any other form of processing. The measures adopted need to be appropriate, bearing in mind the nature of the data in question and the risks associated with processing it. The Law also indicates that ‘state-of-the-art’ technological protection measures should be adopted, but this is tempered by reference to the costs arising from use of such technology.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Additionally, the Law contemplates the issuance of a regulation specifying requirements that technical and organisational measures must satisfy. It also provides scope for specific requirements to be prescribed in such regulations.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Data controllers are required to maintain documentation that reflects the technical and organizational measures adopted. This documentation must be available for viewing by the parties concerned (presumably, including data subjects), as well as the Authority, any data processors, and the data controller itself.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">With regard to processing by data processors, the Law requires data controllers to engage only data processors who provide sufficient guarantees regarding the application of technical and organisational measures. Importantly, there is an obligation on data controllers to take steps to verify compliance with such measures, and to enter into a written contract with the data processor requiring that the data processor shall only process data in accordance with the instructions of the data controller, and in accordance with the data controller’s requirements with regard to security and confidentiality.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">There does not appear to be any specific obligation to notify the Authority in the event of a data breach incident. It is possible that this level of detail might be addressed in the regulations, or that the Authority is expected to address breaches only in the event that they become aware of them, and the circumstances indicate a breach of the obligation to use suitable technical and organizational security measures.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Data protection supervisor</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law contemplates a role of ‘Data Protection Supervisor’ (which is not a data protection officer) intended to act as an independent and impartial intermediary between the data controller and the Authority.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The data protection supervisor will help the data controller fulfil its rights and obligations, and coordinate between the data controller and the Authority. It will also be required to verify the data controller’s processing in compliance with the law, alert the data controller to any apparent non-compliance to enable the issue to be addressed, and alert the Authority where such non-compliance has not been addressed within a specified timeframe. The data protection supervisor will also be required to maintain a register of the data controller’s processing operations that the data controller must notify the Authority, and update the Authority of the same on a monthly basis. (If no data protection supervisor is appointed, then the data controller is required to do this itself.)</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The qualifications and requirements for registration as a data protection supervisor will be officially issued, and data protection supervisors will need to be registered on a register maintained by the Authority. The requirement to appoint a data protection supervisor is optional, although it may be made compulsory for specific categories of data controllers.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The concept of a data protection supervisor has the potential to result in a whole new industry in the Bahrain market. The regulations setting out the requirements for the registration of data protection supervisors may shed greater light on what is anticipated, in terms of who might be able to fulfil such roles. The most natural development may be for the role to be filled by consulting/audit firms with expertise in data protection related issues.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Conclusion</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Bahrain’s new Data Protection Law will require a great deal of attention from businesses operating in Bahrain. Data protection has not been a high priority topic for most businesses in Bahrain, with the limited exception of international entities subject to data protection requirements in other jurisdictions in which they operate. While the publication of the new Law will result in some degree of a lead-in period within which entities subject to the Law will need to comply, the fact that the Law creates criminal offences means that compliance is all the more important and should be treated as a high priority.</p>'),
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(260904, 25308, 'ReportText', '<p dir=\"LTR\" align=\"LEFT\"><img class=\"size-full wp-image-8044 alignnone\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/cvdfd.jpg\" alt=\"\" width=\"6000\" height=\"2401\" /></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Bahrain’s Law on the Protection of Personal Data was published on 19 July 2018, and will come into effect on 1 August 2019. The Law will require a variety of changes to the way businesses process personal data in Bahrain or about residents of Bahrain. Data protection has not been a high priority topic for most businesses in Bahrain, with the limited exception of international entities subject to data protection requirements in other jurisdictions in which they operate. While the publication of the new Law provides a considerable lead-in period within which entities subject to the Law will need to comply, the fact that the Law creates criminal offences means that compliance is all the more important and should be treated as a high priority.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Until now, and with one exception (namely, Qatar), none of the Gulf Cooperation Council member states had a modern, nationally applicable data protection law. Legal issues relating to privacy and data protection are typically analysed in terms of general, and ill-fitting, criminal provisions relating to the unauthorized disclosure of secrets, or – in appropriate circumstances - industry-specific obligations relating to healthcare or credit data, or telecommunications sector subscriber data.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law is generally composed of 60 articles divided into three broad sections or ‘titles’. These are:</p>\r\n\r\n<ul>\r\n 	<li dir=\"LTR\">Title 1: Processing Provisions – Including definitions and general rules for the legality of processing, controls of data processing and transfer, statements as well as the rights of the data holder.</li>\r\n 	<li dir=\"LTR\">Title 2: Data Protection Authority - Including provisions relating to the establishment of the regulator, and its rights and responsibilities.</li>\r\n 	<li dir=\"LTR\">Title 3: Accountability of the data manager (data controller) and data processor – Including provisions relating to accountability to the regulator, investigation procedures, civil and criminal liability, and penalties for violation.</li>\r\n</ul>\r\n<p dir=\"LTR\" align=\"LEFT\">In this article, we consider some key areas addressed in the Data Protection Law.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Application</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Bahrain’s Data Protection Law describes the legal protection of personal privacy as among the main constitutional rights of the person, and notes that it should be protected, particularly in the context of the increasing use of electronic/digital means for processing information.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law applies to:</p>\r\n\r\n<ul>\r\n 	<li dir=\"LTR\">Every individual residing normally in Bahrain or having a workplace in Bahrain, and every legal person (corporate) having a place of business in the Kingdom of Bahrain; and</li>\r\n 	<li dir=\"LTR\">Every individual not residing normally in Bahrain or having a workplace in Bahrain, and every legal person (corporate) not having a place of business in the Kingdom of Bahrain, where such persons are processing data using means available in Bahrain, except where such processing means are solely for the purpose of passing data through Bahrain.</li>\r\n</ul>\r\n<p dir=\"LTR\" align=\"LEFT\">In this latter scenario, the legal person (corporate) is required to appoint an authorized representative in Bahrain, and notify the Authority of such appointment. This provision would appear to affect, for example, corporate customers of cloud service providers, where the customer is based outside Bahrain, and the services being provided to the customer are being provided from data centres located in Bahrain.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Criminal provisions</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law criminalizes a variety of acts that would, at most, be the subject of administrative penalties in data protection laws elsewhere. Penalties generally comprise up to one year in prison and/or a fine of between BHD1,000 and BHD20,000 (between about USD 2,600 to about USD 53,000) (or a fine only in the case of corporate entities). The following are examples of activities that attract criminal penalties under the Law:</p>\r\n\r\n<ul>\r\n 	<li dir=\"LTR\">processing sensitive personal data in violation of the provision specifying requirements for processing sensitive personal data;</li>\r\n 	<li dir=\"LTR\">transferring personal data outside Bahrain contrary to the provisions specifying requirements for transfers to jurisdictions that provide an adequate level of data protection, and associated exceptions;</li>\r\n 	<li dir=\"LTR\">processing personal data without notifying the Authority in accordance with the provision that sets out the obligation to notify the Authority before commencing any data processing activities (except where certain exceptions apply), or failing to update such notification to the Authority;</li>\r\n 	<li dir=\"LTR\">Processing personal data contrary to the provision that requires prior authorization from the Authority before processing personal data in certain circumstances;</li>\r\n 	<li dir=\"LTR\">Providing false or misleading information to the Authority or to a data subject, or withholding relevant information from the Authority, or otherwise hindering the Authority’s work; and</li>\r\n 	<li dir=\"LTR\">Disclosing any data or information accessed due to work, or using the same for own benefit or for the benefit of others unreasonably and in violation of the provisions of this law.</li>\r\n</ul>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Security considerations</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\"><img class=\"wp-image-8068 alignleft\" src=\"http://www.tamimi.com/wp-content/uploads/2018/08/56.jpg\" alt=\"\" width=\"374\" height=\"249\" />Generally, the security of processing provisions, and the confidentiality provisions, appear to be fairly standard.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Data controllers are required to apply technical and organizational measures capable of protecting personal data against unintentional or unauthorized destruction, accidental loss, unauthorized alteration, disclosure or access, or any other form of processing. The measures adopted need to be appropriate, bearing in mind the nature of the data in question and the risks associated with processing it. The Law also indicates that ‘state-of-the-art’ technological protection measures should be adopted, but this is tempered by reference to the costs arising from use of such technology.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Additionally, the Law contemplates the issuance of a regulation specifying requirements that technical and organisational measures must satisfy. It also provides scope for specific requirements to be prescribed in such regulations.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Data controllers are required to maintain documentation that reflects the technical and organizational measures adopted. This documentation must be available for viewing by the parties concerned (presumably, including data subjects), as well as the Authority, any data processors, and the data controller itself.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">With regard to processing by data processors, the Law requires data controllers to engage only data processors who provide sufficient guarantees regarding the application of technical and organisational measures. Importantly, there is an obligation on data controllers to take steps to verify compliance with such measures, and to enter into a written contract with the data processor requiring that the data processor shall only process data in accordance with the instructions of the data controller, and in accordance with the data controller’s requirements with regard to security and confidentiality.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">There does not appear to be any specific obligation to notify the Authority in the event of a data breach incident. It is possible that this level of detail might be addressed in the regulations, or that the Authority is expected to address breaches only in the event that they become aware of them, and the circumstances indicate a breach of the obligation to use suitable technical and organizational security measures.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Data protection supervisor</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law contemplates a role of ‘Data Protection Supervisor’ (which is not a data protection officer) intended to act as an independent and impartial intermediary between the data controller and the Authority.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The data protection supervisor will help the data controller fulfil its rights and obligations, and coordinate between the data controller and the Authority. It will also be required to verify the data controller’s processing in compliance with the law, alert the data controller to any apparent non-compliance to enable the issue to be addressed, and alert the Authority where such non-compliance has not been addressed within a specified timeframe. The data protection supervisor will also be required to maintain a register of the data controller’s processing operations that the data controller must notify the Authority, and update the Authority of the same on a monthly basis. (If no data protection supervisor is appointed, then the data controller is required to do this itself.)</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The qualifications and requirements for registration as a data protection supervisor will be officially issued, and data protection supervisors will need to be registered on a register maintained by the Authority. The requirement to appoint a data protection supervisor is optional, although it may be made compulsory for specific categories of data controllers.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The concept of a data protection supervisor has the potential to result in a whole new industry in the Bahrain market. The regulations setting out the requirements for the registration of data protection supervisors may shed greater light on what is anticipated, in terms of who might be able to fulfil such roles. The most natural development may be for the role to be filled by consulting/audit firms with expertise in data protection related issues.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Conclusion</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Bahrain’s new Data Protection Law will require a great deal of attention from businesses operating in Bahrain. Data protection has not been a high priority topic for most businesses in Bahrain, with the limited exception of international entities subject to data protection requirements in other jurisdictions in which they operate. While the publication of the new Law will result in some degree of a lead-in period within which entities subject to the Law will need to comply, the fact that the Law creates criminal offences means that compliance is all the more important and should be treated as a high priority.</p>|<p dir=\"LTR\" align=\"LEFT\"><img class=\"size-full wp-image-8044 alignnone\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/cvdfd.jpg\" alt=\"\" width=\"6000\" height=\"2401\" /></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Bahrain’s Law on the Protection of Personal Data was published on 19 July 2018, and will come into effect on 1 August 2019. The Law will require a variety of changes to the way businesses process personal data in Bahrain or about residents of Bahrain. Data protection has not been a high priority topic for most businesses in Bahrain, with the limited exception of international entities subject to data protection requirements in other jurisdictions in which they operate. While the publication of the new Law provides a considerable lead-in period within which entities subject to the Law will need to comply, the fact that the Law creates criminal offences means that compliance is all the more important and should be treated as a high priority.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Until now, and with one exception (namely, Qatar), none of the Gulf Cooperation Council member states had a modern, nationally applicable data protection law. Legal issues relating to privacy and data protection are typically analysed in terms of general, and ill-fitting, criminal provisions relating to the unauthorized disclosure of secrets, or – in appropriate circumstances - industry-specific obligations relating to healthcare or credit data, or telecommunications sector subscriber data.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law is generally composed of 60 articles divided into three broad sections or ‘titles’. These are:</p>\r\n\r\n<ul>\r\n 	<li dir=\"LTR\">Title 1: Processing Provisions – Including definitions and general rules for the legality of processing, controls of data processing and transfer, statements as well as the rights of the data holder.</li>\r\n 	<li dir=\"LTR\">Title 2: Data Protection Authority - Including provisions relating to the establishment of the regulator, and its rights and responsibilities.</li>\r\n 	<li dir=\"LTR\">Title 3: Accountability of the data manager (data controller) and data processor – Including provisions relating to accountability to the regulator, investigation procedures, civil and criminal liability, and penalties for violation.</li>\r\n</ul>\r\n<p dir=\"LTR\" align=\"LEFT\">In this article, we consider some key areas addressed in the Data Protection Law.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Application</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Bahrain’s Data Protection Law describes the legal protection of personal privacy as among the main constitutional rights of the person, and notes that it should be protected, particularly in the context of the increasing use of electronic/digital means for processing information.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law applies to:</p>\r\n\r\n<ul>\r\n 	<li dir=\"LTR\">Every individual residing normally in Bahrain or having a workplace in Bahrain, and every legal person (corporate) having a place of business in the Kingdom of Bahrain; and</li>\r\n 	<li dir=\"LTR\">Every individual not residing normally in Bahrain or having a workplace in Bahrain, and every legal person (corporate) not having a place of business in the Kingdom of Bahrain, where such persons are processing data using means available in Bahrain, except where such processing means are solely for the purpose of passing data through Bahrain.</li>\r\n</ul>\r\n<p dir=\"LTR\" align=\"LEFT\">In this latter scenario, the legal person (corporate) is required to appoint an authorized representative in Bahrain, and notify the Authority of such appointment. This provision would appear to affect, for example, corporate customers of cloud service providers, where the customer is based outside Bahrain, and the services being provided to the customer are being provided from data centres located in Bahrain.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Criminal provisions</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law criminalizes a variety of acts that would, at most, be the subject of administrative penalties in data protection laws elsewhere. Penalties generally comprise up to one year in prison and/or a fine of between BHD1,000 and BHD20,000 (between about USD 2,600 to about USD 53,000) (or a fine only in the case of corporate entities). The following are examples of activities that attract criminal penalties under the Law:</p>\r\n\r\n<ul>\r\n 	<li dir=\"LTR\">processing sensitive personal data in violation of the provision specifying requirements for processing sensitive personal data;</li>\r\n 	<li dir=\"LTR\">transferring personal data outside Bahrain contrary to the provisions specifying requirements for transfers to jurisdictions that provide an adequate level of data protection, and associated exceptions;</li>\r\n 	<li dir=\"LTR\">processing personal data without notifying the Authority in accordance with the provision that sets out the obligation to notify the Authority before commencing any data processing activities (except where certain exceptions apply), or failing to update such notification to the Authority;</li>\r\n 	<li dir=\"LTR\">Processing personal data contrary to the provision that requires prior authorization from the Authority before processing personal data in certain circumstances;</li>\r\n 	<li dir=\"LTR\">Providing false or misleading information to the Authority or to a data subject, or withholding relevant information from the Authority, or otherwise hindering the Authority’s work; and</li>\r\n 	<li dir=\"LTR\">Disclosing any data or information accessed due to work, or using the same for own benefit or for the benefit of others unreasonably and in violation of the provisions of this law.</li>\r\n</ul>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Security considerations</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\"><img class=\"wp-image-8068 alignright\" src=\"http://www.tamimi.com/wp-content/uploads/2018/08/56.jpg\" alt=\"\" width=\"489\" height=\"326\" />Generally, the security of processing provisions, and the confidentiality provisions, appear to be fairly standard.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Data controllers are required to apply technical and organizational measures capable of protecting personal data against unintentional or unauthorized destruction, accidental loss, unauthorized alteration, disclosure or access, or any other form of processing. The measures adopted need to be appropriate, bearing in mind the nature of the data in question and the risks associated with processing it. The Law also indicates that ‘state-of-the-art’ technological protection measures should be adopted, but this is tempered by reference to the costs arising from use of such technology.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Additionally, the Law contemplates the issuance of a regulation specifying requirements that technical and organisational measures must satisfy. It also provides scope for specific requirements to be prescribed in such regulations.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Data controllers are required to maintain documentation that reflects the technical and organizational measures adopted. This documentation must be available for viewing by the parties concerned (presumably, including data subjects), as well as the Authority, any data processors, and the data controller itself.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">With regard to processing by data processors, the Law requires data controllers to engage only data processors who provide sufficient guarantees regarding the application of technical and organisational measures. Importantly, there is an obligation on data controllers to take steps to verify compliance with such measures, and to enter into a written contract with the data processor requiring that the data processor shall only process data in accordance with the instructions of the data controller, and in accordance with the data controller’s requirements with regard to security and confidentiality.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">There does not appear to be any specific obligation to notify the Authority in the event of a data breach incident. It is possible that this level of detail might be addressed in the regulations, or that the Authority is expected to address breaches only in the event that they become aware of them, and the circumstances indicate a breach of the obligation to use suitable technical and organizational security measures.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Data protection supervisor</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Law contemplates a role of ‘Data Protection Supervisor’ (which is not a data protection officer) intended to act as an independent and impartial intermediary between the data controller and the Authority.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The data protection supervisor will help the data controller fulfil its rights and obligations, and coordinate between the data controller and the Authority. It will also be required to verify the data controller’s processing in compliance with the law, alert the data controller to any apparent non-compliance to enable the issue to be addressed, and alert the Authority where such non-compliance has not been addressed within a specified timeframe. The data protection supervisor will also be required to maintain a register of the data controller’s processing operations that the data controller must notify the Authority, and update the Authority of the same on a monthly basis. (If no data protection supervisor is appointed, then the data controller is required to do this itself.)</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The qualifications and requirements for registration as a data protection supervisor will be officially issued, and data protection supervisors will need to be registered on a register maintained by the Authority. The requirement to appoint a data protection supervisor is optional, although it may be made compulsory for specific categories of data controllers.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The concept of a data protection supervisor has the potential to result in a whole new industry in the Bahrain market. The regulations setting out the requirements for the registration of data protection supervisors may shed greater light on what is anticipated, in terms of who might be able to fulfil such roles. The most natural development may be for the role to be filled by consulting/audit firms with expertise in data protection related issues.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Conclusion</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Bahrain’s new Data Protection Law will require a great deal of attention from businesses operating in Bahrain. Data protection has not been a high priority topic for most businesses in Bahrain, with the limited exception of international entities subject to data protection requirements in other jurisdictions in which they operate. While the publication of the new Law will result in some degree of a lead-in period within which entities subject to the Law will need to comply, the fact that the Law creates criminal offences means that compliance is all the more important and should be treated as a high priority.</p>'),
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(260961, 25313, 'MetaValueNew', '<img class=\"alignleft size-full wp-image-8002\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/17-1.png\" alt=\"\" width=\"3567\" height=\"715\" />\r\n</br><p dir=\"LTR\" align=\"LEFT\">The UK legislature has recently introduced domestic legislation aimed at money launderers, potentially resulting in unintended consequences for foreign nationals who have legitimate assets in the UK. These orders demand the intended target provide information about the origin of their wealth, and refusal to disclose that information may render the target subject to criminal prosecution in the UK. However, if the foreign national does comply with the Unexplained Wealth Order (UWO), then that individual may be subject to criminal prosecution in another State… a real Catch 22.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Controversially, there is no need for a foreign national to be accused of money laundering, or any criminality whatsoever, before they could be made subject to a UWO, which would lead to the freezing of their assets, or, worse, criminal prosecution.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The following article introduces UWOs to our clients and examines how one must be careful in weighing up their rights and obligations in respect of the request of a foreign State’s investigative authorities as it may impact their rights in the UAE, and around the GCC.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What is a UWO?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">On 31st January 2018, the UK introduced their latest attempt at stemming money laundering in the UK: Unexplained Wealth Orders. UWOs are civil investigative powers that are aimed at tackling those who use the UK as a destination for money laundering, or as a destination for those who wish to spend their ill-gotten gains.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">UWOs have been introduced in the UK at a time when London, and the UK, is facing scrutiny as a perceived hotbed of money laundering and revelry. A main proponent of UWOs has been Transparency International UK’s corruption taskforce, who, amongst others, have repeatedly called for greater investigative action to be taken in the UK against individuals and entities thought to have been complicit in corruption, and have led the drive to bring UWOs into action in UK law.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">UWOs are given legal effect pursuant to the UK Proceeds of Crime Act 2002 Article 362A, as introduced by the Criminal Finances Act 2017, and is defined in the legislation as:</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><em>‘An unexplained wealth order is an order requiring the respondent [i.e. the target of the order] to provide a statement—</em></p>\r\n\r\n<ul>\r\n 	<li><em>setting out the nature and extent of the respondent’s interest in the property in respect of which the order is made,</em></li>\r\n 	<li><em>explaining how the respondent obtained the property (including, in particular, how any costs incurred in obtaining it were met),</em></li>\r\n 	<li><em>where the property is held by the trustees of a settlement, setting out such details of the settlement as may be specified in the order, and</em></li>\r\n 	<li><em>setting out such other information in connection with the property as may be so specified.’</em></li>\r\n</ul>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">The clear advantage that UWOs provide for UK investigative authorities is that it is no longer necessary for the UK authorities to demonstrate that an individual has been subject to a conviction for a criminal offence (either in the UK or abroad) in order to obtain information and take measures against a specific property.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Two months after the introduction of the legislation, in March 2018, it would appear that the first orders are now being made. We have seen the first use of these orders, not on a UK national, but on an Asian politician who owns two properties, worth USD $30 million, in the UK. The specific identity of this individual has not been disclosed as matters are ongoing, and no further details are available publically.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">This means that if an individual owns assets in the UK and they are made subject to a UWO, they will be forced to declare how they obtained this asset, and if they fail to do so they would be subject to criminal prosecution by the UK authorities. This may lead to foreign individuals being stuck between a rock and a hard place, with nowhere to turn and no route of escape.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Why is it Relevant To You?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">As will be apparent from the first orders made against the Asian politician, whilst UWOs do apply to individuals who are reasonably suspected of being involved in crime, the UWOs will also target politically exposed individuals who have not been subject to criminal conviction, or investigation, either in the UK or internationally.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The definition of a PEP, or Politically Exposed Person, varies from State to State, but for the purposes of the UK legislation, the legislators have defined PEPs as the following:</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">‘(a) an individual who is, or has been, entrusted with prominent public functions by an international body or by a State other than the UK or other [European Economic Area] State;</p>\r\n<p dir=\"LTR\" align=\"LEFT\">(b) a family member of a person within paragraph (a); or</p>\r\n<p dir=\"LTR\" align=\"LEFT\">(c) known to be a close associate of a person within […] paragraph [a].’</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">Evidently from this definition, paying particularly close attention to (c) namely ‘a close associate’ of an individual with prominent public functions, there is a very expansive definition of PEP, and this will likely include many unsuspecting individuals. The effect of this definition is that if you are an individual who has prominent public functions, or you are a close associate of another who has been entrusted with public functions, then you may now be targeted by the UK authorities with a UWO. Alarmingly, there is no need for you to have committed a crime, nor to have been suspected of being involved in a crime, for these orders to apply to you.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Specifically, when could a UWO apply?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">A UK high court judge can give notice of a UWO if the judge is satisfied that it is likely that a foreign PEP (as defined above) is the owner of suspicious wealth in the UK beyond their means, and if all of the following provisions are met:</p>\r\n\r\n<ol>\r\n 	<li dir=\"LTR\">The respondent’s known income is insufficient to obtain the asset; and</li>\r\n 	<li dir=\"LTR\">The value of the asset is greater than £50,000 (approx. AED 260,000).</li>\r\n</ol>\r\n<p dir=\"LTR\" align=\"LEFT\">This legislation does not only target Foreign PEPs, but also where there are reasonable grounds to suspect any individual has been involved in serious crime.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Applications for UWOs may be made without notice. This means that there is no requirement on the UK investigative authority to notify the target of a UWO that they, or their assets, have been made subject of a UWO.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What assets would this apply to?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">A UWO can be made against assets whose value is greater than £50,000. There is no need for the PEP to be the sole owner of the property whose value is over £50,000, nor is it of relevance if the property was purchased prior to the introduction of the UK legislation.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What is the effect?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Following the making of an order by the High Court, the Court may order an individual’s property to be frozen, which would preclude the subject of the order from dealing with the property. As these freezing orders may be made without notice, this means that an individual’s assets may be frozen prior to their knowledge of any order being made against them.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The UWO will mandate the individual to explain, at a minimum:</p>\r\n\r\n<ol>\r\n 	<li dir=\"LTR\">The nature and extent of their interest in a particular property; and</li>\r\n 	<li dir=\"LTR\">Explain how the property was obtained.</li>\r\n</ol>\r\n<p dir=\"LTR\" align=\"LEFT\">An explanation will be requested by the UK authorities where ‘there are reasonable grounds to suspect that the respondent’s known lawfully obtained income would be insufficient to allow the respondent to obtain the property’.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Failing to Comply?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Should the target of a UWO fail to comply with an order, or provide inaccurate or misleading information, then they will likely be subject to criminal sanction in the UK and may face a period of imprisonment and a financial penalty.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Within the legislation, it is stated that a UWO could lead to criminal liability for a target if that individual fails, without reasonable excuse, to comply with the requirements imposed by the Court against that individual. There is no definition of what a reasonable excuse would be in the legislation, and is a subjective requirement that would be decided in Court during the course of litigation.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong><img class=\"wp-image-8014 size-medium alignright\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/Screen-Shot-2018-07-31-at-5.43.01-PM-242x300.png\" alt=\"\" width=\"242\" height=\"300\" />A View from the East: Stuck between a Rock and a Hard Place?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">These orders, whilst designed to tackle money laundering on a global scale, and limit the use of the UK jurisdiction for those who seek to gain from their ill-gotten earnings, may cause legal difficulties for individuals based in foreign jurisdictions who are subject to UWOs – such as the UAE and the wider GCC – due to a conflict of laws between this UK legislation and that of other countries. This conflict could lead to an individual’s adherence to UK legislation meaning that the individual would be liable to prosecution in other jurisdictions.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Taking the UAE as a representative example of the Middle East’s approach to confidential or private information, the UAE’s jurisdiction imposes very strict obligations on an individual’s use and disclosure of confidential information. It is a criminal offence, pursuant to the UAE’s Federal Law No. 3 of 1987, as amended by Federal Decree No. 7 of 2016 (UAE Penal Code) to disclose secret information. Secret information is afforded an expansive definition in the UAE Penal Code and it is commonly viewed any information that is confidential, i.e. not in the public domain, and that an individual possesses due to their employment or individual nature.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Furthermore, due to the extraterritorial nature of the UAE Penal Code, should an individual commit a crime that is wholly or partly committed within the UAE, then that individual would be bound by the provisions of the Penal Code, and would be bound by provisions such as the disclosure of secret information. Specifically, should an individual be requested to provide secret information, such as the source of funds from a business entity, to the UK authorities, and that information relates to a UAE business or UAE based individual, then if the material or information is disclosed following a UWO in the UK, then in the UAE the individual may be subject to criminal prosecution for disclosing that exact information.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">There is no exception afforded under UAE domestic legislation that would permit an individual to disclose confidential information to a foreign investigative authority (such as the UK’s Serious Fraud Office, Financial Conduct Authority, or National Security Agency). Should that individual disclose such information to the UK’s, or any other foreign State’s, investigative authority, then that individual may be liable to prosecution in the UAE in the same manner as though the disclosure had been made to a private individual or entity.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Prosecution for disclosing confidential information is a serious offence in the UAE, and one that may carry a mandatory minimum period of imprisonment. Accordingly, the stakes are very high when one is subject to an international request for judicial assistance, in any form, and it is for that reason and in order to assist with international criminal investigations that the UAE has entered into number multilateral and bilateral treaties aimed at assisting mutual judicial assistance requests. As with most international requests from law enforcement agencies, such requests should follow the usual diplomatic channels through the deployment of letters rogatory.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The difficulties for UAE individuals would not stop simply at the threat of criminal sanction, but also according to the UAE’s Labour Law, should an individual disclose the secrets of their employer, then the worker may be dismissed without notice and forfeit their entire severance pay.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Accordingly, the receipt of a UWO in the UK demanding that an individual provide information to the UAE authorities may conflict with the statutory protection relating to confidential information (or other laws) in a foreign jurisdiction, such as the UAE. This would lead to the precarious situation where an individual may face prosecution in the UK if he doesn’t comply with the UWO, but criminal prosecution in the UAE if he does comply.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Conclusion</strong></p>\r\nThe above example and review provides a very high-level overview of the competing laws that the UK’s UWOs may catch. Whilst the UK legislation will no doubt serve as an effective deterrent and useful tool in minimising global money laundering, and limiting the attraction of the UK for criminals, it may have unintended consequences for foreign nationals holding legitimate assets in the UK. Prior to making any response to a request for assistance, it is imperative that the recipient apprise themselves of all legal considerations to ensure that they are not jumping out of the frying pan, but straight into the fire.'),
(260962, 25313, 'MetaValueOld', '<p dir=\"LTR\" align=\"LEFT\"><img class=\"alignleft size-full wp-image-8002\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/17-1.png\" alt=\"\" width=\"3567\" height=\"715\" /></p>\r\n</br>The UK legislature has recently introduced domestic legislation aimed at money launderers, potentially resulting in unintended consequences for foreign nationals who have legitimate assets in the UK. These orders demand the intended target provide information about the origin of their wealth, and refusal to disclose that information may render the target subject to criminal prosecution in the UK. However, if the foreign national does comply with the Unexplained Wealth Order (UWO), then that individual may be subject to criminal prosecution in another State… a real Catch 22.\r\n<p dir=\"LTR\" align=\"LEFT\">Controversially, there is no need for a foreign national to be accused of money laundering, or any criminality whatsoever, before they could be made subject to a UWO, which would lead to the freezing of their assets, or, worse, criminal prosecution.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The following article introduces UWOs to our clients and examines how one must be careful in weighing up their rights and obligations in respect of the request of a foreign State’s investigative authorities as it may impact their rights in the UAE, and around the GCC.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What is a UWO?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">On 31st January 2018, the UK introduced their latest attempt at stemming money laundering in the UK: Unexplained Wealth Orders. UWOs are civil investigative powers that are aimed at tackling those who use the UK as a destination for money laundering, or as a destination for those who wish to spend their ill-gotten gains.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">UWOs have been introduced in the UK at a time when London, and the UK, is facing scrutiny as a perceived hotbed of money laundering and revelry. A main proponent of UWOs has been Transparency International UK’s corruption taskforce, who, amongst others, have repeatedly called for greater investigative action to be taken in the UK against individuals and entities thought to have been complicit in corruption, and have led the drive to bring UWOs into action in UK law.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">UWOs are given legal effect pursuant to the UK Proceeds of Crime Act 2002 Article 362A, as introduced by the Criminal Finances Act 2017, and is defined in the legislation as:</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><em>‘An unexplained wealth order is an order requiring the respondent [i.e. the target of the order] to provide a statement—</em></p>\r\n\r\n<ul>\r\n 	<li><em>setting out the nature and extent of the respondent’s interest in the property in respect of which the order is made,</em></li>\r\n 	<li><em>explaining how the respondent obtained the property (including, in particular, how any costs incurred in obtaining it were met),</em></li>\r\n 	<li><em>where the property is held by the trustees of a settlement, setting out such details of the settlement as may be specified in the order, and</em></li>\r\n 	<li><em>setting out such other information in connection with the property as may be so specified.’</em></li>\r\n</ul>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">The clear advantage that UWOs provide for UK investigative authorities is that it is no longer necessary for the UK authorities to demonstrate that an individual has been subject to a conviction for a criminal offence (either in the UK or abroad) in order to obtain information and take measures against a specific property.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Two months after the introduction of the legislation, in March 2018, it would appear that the first orders are now being made. We have seen the first use of these orders, not on a UK national, but on an Asian politician who owns two properties, worth USD $30 million, in the UK. The specific identity of this individual has not been disclosed as matters are ongoing, and no further details are available publically.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">This means that if an individual owns assets in the UK and they are made subject to a UWO, they will be forced to declare how they obtained this asset, and if they fail to do so they would be subject to criminal prosecution by the UK authorities. This may lead to foreign individuals being stuck between a rock and a hard place, with nowhere to turn and no route of escape.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Why is it Relevant To You?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">As will be apparent from the first orders made against the Asian politician, whilst UWOs do apply to individuals who are reasonably suspected of being involved in crime, the UWOs will also target politically exposed individuals who have not been subject to criminal conviction, or investigation, either in the UK or internationally.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The definition of a PEP, or Politically Exposed Person, varies from State to State, but for the purposes of the UK legislation, the legislators have defined PEPs as the following:</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">‘(a) an individual who is, or has been, entrusted with prominent public functions by an international body or by a State other than the UK or other [European Economic Area] State;</p>\r\n<p dir=\"LTR\" align=\"LEFT\">(b) a family member of a person within paragraph (a); or</p>\r\n<p dir=\"LTR\" align=\"LEFT\">(c) known to be a close associate of a person within […] paragraph [a].’</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">Evidently from this definition, paying particularly close attention to (c) namely ‘a close associate’ of an individual with prominent public functions, there is a very expansive definition of PEP, and this will likely include many unsuspecting individuals. The effect of this definition is that if you are an individual who has prominent public functions, or you are a close associate of another who has been entrusted with public functions, then you may now be targeted by the UK authorities with a UWO. Alarmingly, there is no need for you to have committed a crime, nor to have been suspected of being involved in a crime, for these orders to apply to you.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Specifically, when could a UWO apply?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">A UK high court judge can give notice of a UWO if the judge is satisfied that it is likely that a foreign PEP (as defined above) is the owner of suspicious wealth in the UK beyond their means, and if all of the following provisions are met:</p>\r\n\r\n<ol>\r\n 	<li dir=\"LTR\">The respondent’s known income is insufficient to obtain the asset; and</li>\r\n 	<li dir=\"LTR\">The value of the asset is greater than £50,000 (approx. AED 260,000).</li>\r\n</ol>\r\n<p dir=\"LTR\" align=\"LEFT\">This legislation does not only target Foreign PEPs, but also where there are reasonable grounds to suspect any individual has been involved in serious crime.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Applications for UWOs may be made without notice. This means that there is no requirement on the UK investigative authority to notify the target of a UWO that they, or their assets, have been made subject of a UWO.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What assets would this apply to?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">A UWO can be made against assets whose value is greater than £50,000. There is no need for the PEP to be the sole owner of the property whose value is over £50,000, nor is it of relevance if the property was purchased prior to the introduction of the UK legislation.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What is the effect?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Following the making of an order by the High Court, the Court may order an individual’s property to be frozen, which would preclude the subject of the order from dealing with the property. As these freezing orders may be made without notice, this means that an individual’s assets may be frozen prior to their knowledge of any order being made against them.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The UWO will mandate the individual to explain, at a minimum:</p>\r\n\r\n<ol>\r\n 	<li dir=\"LTR\">The nature and extent of their interest in a particular property; and</li>\r\n 	<li dir=\"LTR\">Explain how the property was obtained.</li>\r\n</ol>\r\n<p dir=\"LTR\" align=\"LEFT\">An explanation will be requested by the UK authorities where ‘there are reasonable grounds to suspect that the respondent’s known lawfully obtained income would be insufficient to allow the respondent to obtain the property’.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Failing to Comply?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Should the target of a UWO fail to comply with an order, or provide inaccurate or misleading information, then they will likely be subject to criminal sanction in the UK and may face a period of imprisonment and a financial penalty.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Within the legislation, it is stated that a UWO could lead to criminal liability for a target if that individual fails, without reasonable excuse, to comply with the requirements imposed by the Court against that individual. There is no definition of what a reasonable excuse would be in the legislation, and is a subjective requirement that would be decided in Court during the course of litigation.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong><img class=\"wp-image-8014 size-medium alignright\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/Screen-Shot-2018-07-31-at-5.43.01-PM-242x300.png\" alt=\"\" width=\"242\" height=\"300\" />A View from the East: Stuck between a Rock and a Hard Place?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">These orders, whilst designed to tackle money laundering on a global scale, and limit the use of the UK jurisdiction for those who seek to gain from their ill-gotten earnings, may cause legal difficulties for individuals based in foreign jurisdictions who are subject to UWOs – such as the UAE and the wider GCC – due to a conflict of laws between this UK legislation and that of other countries. This conflict could lead to an individual’s adherence to UK legislation meaning that the individual would be liable to prosecution in other jurisdictions.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Taking the UAE as a representative example of the Middle East’s approach to confidential or private information, the UAE’s jurisdiction imposes very strict obligations on an individual’s use and disclosure of confidential information. It is a criminal offence, pursuant to the UAE’s Federal Law No. 3 of 1987, as amended by Federal Decree No. 7 of 2016 (UAE Penal Code) to disclose secret information. Secret information is afforded an expansive definition in the UAE Penal Code and it is commonly viewed any information that is confidential, i.e. not in the public domain, and that an individual possesses due to their employment or individual nature.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Furthermore, due to the extraterritorial nature of the UAE Penal Code, should an individual commit a crime that is wholly or partly committed within the UAE, then that individual would be bound by the provisions of the Penal Code, and would be bound by provisions such as the disclosure of secret information. Specifically, should an individual be requested to provide secret information, such as the source of funds from a business entity, to the UK authorities, and that information relates to a UAE business or UAE based individual, then if the material or information is disclosed following a UWO in the UK, then in the UAE the individual may be subject to criminal prosecution for disclosing that exact information.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">There is no exception afforded under UAE domestic legislation that would permit an individual to disclose confidential information to a foreign investigative authority (such as the UK’s Serious Fraud Office, Financial Conduct Authority, or National Security Agency). Should that individual disclose such information to the UK’s, or any other foreign State’s, investigative authority, then that individual may be liable to prosecution in the UAE in the same manner as though the disclosure had been made to a private individual or entity.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Prosecution for disclosing confidential information is a serious offence in the UAE, and one that may carry a mandatory minimum period of imprisonment. Accordingly, the stakes are very high when one is subject to an international request for judicial assistance, in any form, and it is for that reason and in order to assist with international criminal investigations that the UAE has entered into number multilateral and bilateral treaties aimed at assisting mutual judicial assistance requests. As with most international requests from law enforcement agencies, such requests should follow the usual diplomatic channels through the deployment of letters rogatory.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The difficulties for UAE individuals would not stop simply at the threat of criminal sanction, but also according to the UAE’s Labour Law, should an individual disclose the secrets of their employer, then the worker may be dismissed without notice and forfeit their entire severance pay.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Accordingly, the receipt of a UWO in the UK demanding that an individual provide information to the UAE authorities may conflict with the statutory protection relating to confidential information (or other laws) in a foreign jurisdiction, such as the UAE. This would lead to the precarious situation where an individual may face prosecution in the UK if he doesn’t comply with the UWO, but criminal prosecution in the UAE if he does comply.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Conclusion</strong></p>\r\nThe above example and review provides a very high-level overview of the competing laws that the UK’s UWOs may catch. Whilst the UK legislation will no doubt serve as an effective deterrent and useful tool in minimising global money laundering, and limiting the attraction of the UK for criminals, it may have unintended consequences for foreign nationals holding legitimate assets in the UK. Prior to making any response to a request for assistance, it is imperative that the recipient apprise themselves of all legal considerations to ensure that they are not jumping out of the frying pan, but straight into the fire.'),
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(260965, 25313, 'ReportText', '<p dir=\"LTR\" align=\"LEFT\"><img class=\"alignleft size-full wp-image-8002\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/17-1.png\" alt=\"\" width=\"3567\" height=\"715\" /></p>\r\n</br>The UK legislature has recently introduced domestic legislation aimed at money launderers, potentially resulting in unintended consequences for foreign nationals who have legitimate assets in the UK. These orders demand the intended target provide information about the origin of their wealth, and refusal to disclose that information may render the target subject to criminal prosecution in the UK. However, if the foreign national does comply with the Unexplained Wealth Order (UWO), then that individual may be subject to criminal prosecution in another State… a real Catch 22.\r\n<p dir=\"LTR\" align=\"LEFT\">Controversially, there is no need for a foreign national to be accused of money laundering, or any criminality whatsoever, before they could be made subject to a UWO, which would lead to the freezing of their assets, or, worse, criminal prosecution.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The following article introduces UWOs to our clients and examines how one must be careful in weighing up their rights and obligations in respect of the request of a foreign State’s investigative authorities as it may impact their rights in the UAE, and around the GCC.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What is a UWO?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">On 31st January 2018, the UK introduced their latest attempt at stemming money laundering in the UK: Unexplained Wealth Orders. UWOs are civil investigative powers that are aimed at tackling those who use the UK as a destination for money laundering, or as a destination for those who wish to spend their ill-gotten gains.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">UWOs have been introduced in the UK at a time when London, and the UK, is facing scrutiny as a perceived hotbed of money laundering and revelry. A main proponent of UWOs has been Transparency International UK’s corruption taskforce, who, amongst others, have repeatedly called for greater investigative action to be taken in the UK against individuals and entities thought to have been complicit in corruption, and have led the drive to bring UWOs into action in UK law.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">UWOs are given legal effect pursuant to the UK Proceeds of Crime Act 2002 Article 362A, as introduced by the Criminal Finances Act 2017, and is defined in the legislation as:</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><em>‘An unexplained wealth order is an order requiring the respondent [i.e. the target of the order] to provide a statement—</em></p>\r\n\r\n<ul>\r\n 	<li><em>setting out the nature and extent of the respondent’s interest in the property in respect of which the order is made,</em></li>\r\n 	<li><em>explaining how the respondent obtained the property (including, in particular, how any costs incurred in obtaining it were met),</em></li>\r\n 	<li><em>where the property is held by the trustees of a settlement, setting out such details of the settlement as may be specified in the order, and</em></li>\r\n 	<li><em>setting out such other information in connection with the property as may be so specified.’</em></li>\r\n</ul>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">The clear advantage that UWOs provide for UK investigative authorities is that it is no longer necessary for the UK authorities to demonstrate that an individual has been subject to a conviction for a criminal offence (either in the UK or abroad) in order to obtain information and take measures against a specific property.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Two months after the introduction of the legislation, in March 2018, it would appear that the first orders are now being made. We have seen the first use of these orders, not on a UK national, but on an Asian politician who owns two properties, worth USD $30 million, in the UK. The specific identity of this individual has not been disclosed as matters are ongoing, and no further details are available publically.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">This means that if an individual owns assets in the UK and they are made subject to a UWO, they will be forced to declare how they obtained this asset, and if they fail to do so they would be subject to criminal prosecution by the UK authorities. This may lead to foreign individuals being stuck between a rock and a hard place, with nowhere to turn and no route of escape.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Why is it Relevant To You?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">As will be apparent from the first orders made against the Asian politician, whilst UWOs do apply to individuals who are reasonably suspected of being involved in crime, the UWOs will also target politically exposed individuals who have not been subject to criminal conviction, or investigation, either in the UK or internationally.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The definition of a PEP, or Politically Exposed Person, varies from State to State, but for the purposes of the UK legislation, the legislators have defined PEPs as the following:</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">‘(a) an individual who is, or has been, entrusted with prominent public functions by an international body or by a State other than the UK or other [European Economic Area] State;</p>\r\n<p dir=\"LTR\" align=\"LEFT\">(b) a family member of a person within paragraph (a); or</p>\r\n<p dir=\"LTR\" align=\"LEFT\">(c) known to be a close associate of a person within […] paragraph [a].’</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">Evidently from this definition, paying particularly close attention to (c) namely ‘a close associate’ of an individual with prominent public functions, there is a very expansive definition of PEP, and this will likely include many unsuspecting individuals. The effect of this definition is that if you are an individual who has prominent public functions, or you are a close associate of another who has been entrusted with public functions, then you may now be targeted by the UK authorities with a UWO. Alarmingly, there is no need for you to have committed a crime, nor to have been suspected of being involved in a crime, for these orders to apply to you.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Specifically, when could a UWO apply?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">A UK high court judge can give notice of a UWO if the judge is satisfied that it is likely that a foreign PEP (as defined above) is the owner of suspicious wealth in the UK beyond their means, and if all of the following provisions are met:</p>\r\n\r\n<ol>\r\n 	<li dir=\"LTR\">The respondent’s known income is insufficient to obtain the asset; and</li>\r\n 	<li dir=\"LTR\">The value of the asset is greater than £50,000 (approx. AED 260,000).</li>\r\n</ol>\r\n<p dir=\"LTR\" align=\"LEFT\">This legislation does not only target Foreign PEPs, but also where there are reasonable grounds to suspect any individual has been involved in serious crime.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Applications for UWOs may be made without notice. This means that there is no requirement on the UK investigative authority to notify the target of a UWO that they, or their assets, have been made subject of a UWO.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What assets would this apply to?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">A UWO can be made against assets whose value is greater than £50,000. There is no need for the PEP to be the sole owner of the property whose value is over £50,000, nor is it of relevance if the property was purchased prior to the introduction of the UK legislation.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What is the effect?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Following the making of an order by the High Court, the Court may order an individual’s property to be frozen, which would preclude the subject of the order from dealing with the property. As these freezing orders may be made without notice, this means that an individual’s assets may be frozen prior to their knowledge of any order being made against them.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The UWO will mandate the individual to explain, at a minimum:</p>\r\n\r\n<ol>\r\n 	<li dir=\"LTR\">The nature and extent of their interest in a particular property; and</li>\r\n 	<li dir=\"LTR\">Explain how the property was obtained.</li>\r\n</ol>\r\n<p dir=\"LTR\" align=\"LEFT\">An explanation will be requested by the UK authorities where ‘there are reasonable grounds to suspect that the respondent’s known lawfully obtained income would be insufficient to allow the respondent to obtain the property’.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Failing to Comply?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Should the target of a UWO fail to comply with an order, or provide inaccurate or misleading information, then they will likely be subject to criminal sanction in the UK and may face a period of imprisonment and a financial penalty.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Within the legislation, it is stated that a UWO could lead to criminal liability for a target if that individual fails, without reasonable excuse, to comply with the requirements imposed by the Court against that individual. There is no definition of what a reasonable excuse would be in the legislation, and is a subjective requirement that would be decided in Court during the course of litigation.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong><img class=\"wp-image-8014 size-medium alignright\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/Screen-Shot-2018-07-31-at-5.43.01-PM-242x300.png\" alt=\"\" width=\"242\" height=\"300\" />A View from the East: Stuck between a Rock and a Hard Place?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">These orders, whilst designed to tackle money laundering on a global scale, and limit the use of the UK jurisdiction for those who seek to gain from their ill-gotten earnings, may cause legal difficulties for individuals based in foreign jurisdictions who are subject to UWOs – such as the UAE and the wider GCC – due to a conflict of laws between this UK legislation and that of other countries. This conflict could lead to an individual’s adherence to UK legislation meaning that the individual would be liable to prosecution in other jurisdictions.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Taking the UAE as a representative example of the Middle East’s approach to confidential or private information, the UAE’s jurisdiction imposes very strict obligations on an individual’s use and disclosure of confidential information. It is a criminal offence, pursuant to the UAE’s Federal Law No. 3 of 1987, as amended by Federal Decree No. 7 of 2016 (UAE Penal Code) to disclose secret information. Secret information is afforded an expansive definition in the UAE Penal Code and it is commonly viewed any information that is confidential, i.e. not in the public domain, and that an individual possesses due to their employment or individual nature.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Furthermore, due to the extraterritorial nature of the UAE Penal Code, should an individual commit a crime that is wholly or partly committed within the UAE, then that individual would be bound by the provisions of the Penal Code, and would be bound by provisions such as the disclosure of secret information. Specifically, should an individual be requested to provide secret information, such as the source of funds from a business entity, to the UK authorities, and that information relates to a UAE business or UAE based individual, then if the material or information is disclosed following a UWO in the UK, then in the UAE the individual may be subject to criminal prosecution for disclosing that exact information.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">There is no exception afforded under UAE domestic legislation that would permit an individual to disclose confidential information to a foreign investigative authority (such as the UK’s Serious Fraud Office, Financial Conduct Authority, or National Security Agency). Should that individual disclose such information to the UK’s, or any other foreign State’s, investigative authority, then that individual may be liable to prosecution in the UAE in the same manner as though the disclosure had been made to a private individual or entity.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Prosecution for disclosing confidential information is a serious offence in the UAE, and one that may carry a mandatory minimum period of imprisonment. Accordingly, the stakes are very high when one is subject to an international request for judicial assistance, in any form, and it is for that reason and in order to assist with international criminal investigations that the UAE has entered into number multilateral and bilateral treaties aimed at assisting mutual judicial assistance requests. As with most international requests from law enforcement agencies, such requests should follow the usual diplomatic channels through the deployment of letters rogatory.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The difficulties for UAE individuals would not stop simply at the threat of criminal sanction, but also according to the UAE’s Labour Law, should an individual disclose the secrets of their employer, then the worker may be dismissed without notice and forfeit their entire severance pay.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Accordingly, the receipt of a UWO in the UK demanding that an individual provide information to the UAE authorities may conflict with the statutory protection relating to confidential information (or other laws) in a foreign jurisdiction, such as the UAE. This would lead to the precarious situation where an individual may face prosecution in the UK if he doesn’t comply with the UWO, but criminal prosecution in the UAE if he does comply.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Conclusion</strong></p>\r\nThe above example and review provides a very high-level overview of the competing laws that the UK’s UWOs may catch. Whilst the UK legislation will no doubt serve as an effective deterrent and useful tool in minimising global money laundering, and limiting the attraction of the UK for criminals, it may have unintended consequences for foreign nationals holding legitimate assets in the UK. Prior to making any response to a request for assistance, it is imperative that the recipient apprise themselves of all legal considerations to ensure that they are not jumping out of the frying pan, but straight into the fire.|<img class=\"alignleft size-full wp-image-8002\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/17-1.png\" alt=\"\" width=\"3567\" height=\"715\" />\r\n</br><p dir=\"LTR\" align=\"LEFT\">The UK legislature has recently introduced domestic legislation aimed at money launderers, potentially resulting in unintended consequences for foreign nationals who have legitimate assets in the UK. These orders demand the intended target provide information about the origin of their wealth, and refusal to disclose that information may render the target subject to criminal prosecution in the UK. However, if the foreign national does comply with the Unexplained Wealth Order (UWO), then that individual may be subject to criminal prosecution in another State… a real Catch 22.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Controversially, there is no need for a foreign national to be accused of money laundering, or any criminality whatsoever, before they could be made subject to a UWO, which would lead to the freezing of their assets, or, worse, criminal prosecution.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The following article introduces UWOs to our clients and examines how one must be careful in weighing up their rights and obligations in respect of the request of a foreign State’s investigative authorities as it may impact their rights in the UAE, and around the GCC.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What is a UWO?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">On 31st January 2018, the UK introduced their latest attempt at stemming money laundering in the UK: Unexplained Wealth Orders. UWOs are civil investigative powers that are aimed at tackling those who use the UK as a destination for money laundering, or as a destination for those who wish to spend their ill-gotten gains.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">UWOs have been introduced in the UK at a time when London, and the UK, is facing scrutiny as a perceived hotbed of money laundering and revelry. A main proponent of UWOs has been Transparency International UK’s corruption taskforce, who, amongst others, have repeatedly called for greater investigative action to be taken in the UK against individuals and entities thought to have been complicit in corruption, and have led the drive to bring UWOs into action in UK law.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">UWOs are given legal effect pursuant to the UK Proceeds of Crime Act 2002 Article 362A, as introduced by the Criminal Finances Act 2017, and is defined in the legislation as:</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><em>‘An unexplained wealth order is an order requiring the respondent [i.e. the target of the order] to provide a statement—</em></p>\r\n\r\n<ul>\r\n 	<li><em>setting out the nature and extent of the respondent’s interest in the property in respect of which the order is made,</em></li>\r\n 	<li><em>explaining how the respondent obtained the property (including, in particular, how any costs incurred in obtaining it were met),</em></li>\r\n 	<li><em>where the property is held by the trustees of a settlement, setting out such details of the settlement as may be specified in the order, and</em></li>\r\n 	<li><em>setting out such other information in connection with the property as may be so specified.’</em></li>\r\n</ul>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">The clear advantage that UWOs provide for UK investigative authorities is that it is no longer necessary for the UK authorities to demonstrate that an individual has been subject to a conviction for a criminal offence (either in the UK or abroad) in order to obtain information and take measures against a specific property.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Two months after the introduction of the legislation, in March 2018, it would appear that the first orders are now being made. We have seen the first use of these orders, not on a UK national, but on an Asian politician who owns two properties, worth USD $30 million, in the UK. The specific identity of this individual has not been disclosed as matters are ongoing, and no further details are available publically.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">This means that if an individual owns assets in the UK and they are made subject to a UWO, they will be forced to declare how they obtained this asset, and if they fail to do so they would be subject to criminal prosecution by the UK authorities. This may lead to foreign individuals being stuck between a rock and a hard place, with nowhere to turn and no route of escape.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Why is it Relevant To You?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">As will be apparent from the first orders made against the Asian politician, whilst UWOs do apply to individuals who are reasonably suspected of being involved in crime, the UWOs will also target politically exposed individuals who have not been subject to criminal conviction, or investigation, either in the UK or internationally.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The definition of a PEP, or Politically Exposed Person, varies from State to State, but for the purposes of the UK legislation, the legislators have defined PEPs as the following:</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">‘(a) an individual who is, or has been, entrusted with prominent public functions by an international body or by a State other than the UK or other [European Economic Area] State;</p>\r\n<p dir=\"LTR\" align=\"LEFT\">(b) a family member of a person within paragraph (a); or</p>\r\n<p dir=\"LTR\" align=\"LEFT\">(c) known to be a close associate of a person within […] paragraph [a].’</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">Evidently from this definition, paying particularly close attention to (c) namely ‘a close associate’ of an individual with prominent public functions, there is a very expansive definition of PEP, and this will likely include many unsuspecting individuals. The effect of this definition is that if you are an individual who has prominent public functions, or you are a close associate of another who has been entrusted with public functions, then you may now be targeted by the UK authorities with a UWO. Alarmingly, there is no need for you to have committed a crime, nor to have been suspected of being involved in a crime, for these orders to apply to you.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Specifically, when could a UWO apply?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">A UK high court judge can give notice of a UWO if the judge is satisfied that it is likely that a foreign PEP (as defined above) is the owner of suspicious wealth in the UK beyond their means, and if all of the following provisions are met:</p>\r\n\r\n<ol>\r\n 	<li dir=\"LTR\">The respondent’s known income is insufficient to obtain the asset; and</li>\r\n 	<li dir=\"LTR\">The value of the asset is greater than £50,000 (approx. AED 260,000).</li>\r\n</ol>\r\n<p dir=\"LTR\" align=\"LEFT\">This legislation does not only target Foreign PEPs, but also where there are reasonable grounds to suspect any individual has been involved in serious crime.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Applications for UWOs may be made without notice. This means that there is no requirement on the UK investigative authority to notify the target of a UWO that they, or their assets, have been made subject of a UWO.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What assets would this apply to?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">A UWO can be made against assets whose value is greater than £50,000. There is no need for the PEP to be the sole owner of the property whose value is over £50,000, nor is it of relevance if the property was purchased prior to the introduction of the UK legislation.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What is the effect?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Following the making of an order by the High Court, the Court may order an individual’s property to be frozen, which would preclude the subject of the order from dealing with the property. As these freezing orders may be made without notice, this means that an individual’s assets may be frozen prior to their knowledge of any order being made against them.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The UWO will mandate the individual to explain, at a minimum:</p>\r\n\r\n<ol>\r\n 	<li dir=\"LTR\">The nature and extent of their interest in a particular property; and</li>\r\n 	<li dir=\"LTR\">Explain how the property was obtained.</li>\r\n</ol>\r\n<p dir=\"LTR\" align=\"LEFT\">An explanation will be requested by the UK authorities where ‘there are reasonable grounds to suspect that the respondent’s known lawfully obtained income would be insufficient to allow the respondent to obtain the property’.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Failing to Comply?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Should the target of a UWO fail to comply with an order, or provide inaccurate or misleading information, then they will likely be subject to criminal sanction in the UK and may face a period of imprisonment and a financial penalty.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Within the legislation, it is stated that a UWO could lead to criminal liability for a target if that individual fails, without reasonable excuse, to comply with the requirements imposed by the Court against that individual. There is no definition of what a reasonable excuse would be in the legislation, and is a subjective requirement that would be decided in Court during the course of litigation.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong><img class=\"wp-image-8014 size-medium alignright\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/Screen-Shot-2018-07-31-at-5.43.01-PM-242x300.png\" alt=\"\" width=\"242\" height=\"300\" />A View from the East: Stuck between a Rock and a Hard Place?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">These orders, whilst designed to tackle money laundering on a global scale, and limit the use of the UK jurisdiction for those who seek to gain from their ill-gotten earnings, may cause legal difficulties for individuals based in foreign jurisdictions who are subject to UWOs – such as the UAE and the wider GCC – due to a conflict of laws between this UK legislation and that of other countries. This conflict could lead to an individual’s adherence to UK legislation meaning that the individual would be liable to prosecution in other jurisdictions.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Taking the UAE as a representative example of the Middle East’s approach to confidential or private information, the UAE’s jurisdiction imposes very strict obligations on an individual’s use and disclosure of confidential information. It is a criminal offence, pursuant to the UAE’s Federal Law No. 3 of 1987, as amended by Federal Decree No. 7 of 2016 (UAE Penal Code) to disclose secret information. Secret information is afforded an expansive definition in the UAE Penal Code and it is commonly viewed any information that is confidential, i.e. not in the public domain, and that an individual possesses due to their employment or individual nature.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Furthermore, due to the extraterritorial nature of the UAE Penal Code, should an individual commit a crime that is wholly or partly committed within the UAE, then that individual would be bound by the provisions of the Penal Code, and would be bound by provisions such as the disclosure of secret information. Specifically, should an individual be requested to provide secret information, such as the source of funds from a business entity, to the UK authorities, and that information relates to a UAE business or UAE based individual, then if the material or information is disclosed following a UWO in the UK, then in the UAE the individual may be subject to criminal prosecution for disclosing that exact information.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">There is no exception afforded under UAE domestic legislation that would permit an individual to disclose confidential information to a foreign investigative authority (such as the UK’s Serious Fraud Office, Financial Conduct Authority, or National Security Agency). Should that individual disclose such information to the UK’s, or any other foreign State’s, investigative authority, then that individual may be liable to prosecution in the UAE in the same manner as though the disclosure had been made to a private individual or entity.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Prosecution for disclosing confidential information is a serious offence in the UAE, and one that may carry a mandatory minimum period of imprisonment. Accordingly, the stakes are very high when one is subject to an international request for judicial assistance, in any form, and it is for that reason and in order to assist with international criminal investigations that the UAE has entered into number multilateral and bilateral treaties aimed at assisting mutual judicial assistance requests. As with most international requests from law enforcement agencies, such requests should follow the usual diplomatic channels through the deployment of letters rogatory.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The difficulties for UAE individuals would not stop simply at the threat of criminal sanction, but also according to the UAE’s Labour Law, should an individual disclose the secrets of their employer, then the worker may be dismissed without notice and forfeit their entire severance pay.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Accordingly, the receipt of a UWO in the UK demanding that an individual provide information to the UAE authorities may conflict with the statutory protection relating to confidential information (or other laws) in a foreign jurisdiction, such as the UAE. This would lead to the precarious situation where an individual may face prosecution in the UK if he doesn’t comply with the UWO, but criminal prosecution in the UAE if he does comply.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Conclusion</strong></p>\r\nThe above example and review provides a very high-level overview of the competing laws that the UK’s UWOs may catch. Whilst the UK legislation will no doubt serve as an effective deterrent and useful tool in minimising global money laundering, and limiting the attraction of the UK for criminals, it may have unintended consequences for foreign nationals holding legitimate assets in the UK. Prior to making any response to a request for assistance, it is imperative that the recipient apprise themselves of all legal considerations to ensure that they are not jumping out of the frying pan, but straight into the fire.'),
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(260993, 25316, 'PostTitle', 'Stuck between a rock and a hard place… : The UK’s Unexplained Wealth Orders and the effect in the Middle East'),
(260994, 25316, 'PostStatus', 'publish'),
(260995, 25316, 'PostType', 'law_update_articles'),
(260996, 25316, 'PostDate', '2018-08-01 07:41:14'),
(260997, 25316, 'PostUrl', 'http://www.tamimi.com/law-update-articles/stuck-between-a-rock-and-a-hard-place-the-uks-unexplained-wealth-orders-and-the-effect-in-the-middle-east/'),
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(261000, 25316, 'MetaValueNew', '<img class=\"alignleft size-full wp-image-8002\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/17-1.png\" alt=\"\" width=\"3567\" height=\"715\" />\r\n\r\n</br>The UK legislature has recently introduced domestic legislation aimed at money launderers, potentially resulting in unintended consequences for foreign nationals who have legitimate assets in the UK. These orders demand the intended target provide information about the origin of their wealth, and refusal to disclose that information may render the target subject to criminal prosecution in the UK. However, if the foreign national does comply with the Unexplained Wealth Order (UWO), then that individual may be subject to criminal prosecution in another State… a real Catch 22.\r\n<p dir=\"LTR\" align=\"LEFT\">Controversially, there is no need for a foreign national to be accused of money laundering, or any criminality whatsoever, before they could be made subject to a UWO, which would lead to the freezing of their assets, or, worse, criminal prosecution.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The following article introduces UWOs to our clients and examines how one must be careful in weighing up their rights and obligations in respect of the request of a foreign State’s investigative authorities as it may impact their rights in the UAE, and around the GCC.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What is a UWO?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">On 31st January 2018, the UK introduced their latest attempt at stemming money laundering in the UK: Unexplained Wealth Orders. UWOs are civil investigative powers that are aimed at tackling those who use the UK as a destination for money laundering, or as a destination for those who wish to spend their ill-gotten gains.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">UWOs have been introduced in the UK at a time when London, and the UK, is facing scrutiny as a perceived hotbed of money laundering and revelry. A main proponent of UWOs has been Transparency International UK’s corruption taskforce, who, amongst others, have repeatedly called for greater investigative action to be taken in the UK against individuals and entities thought to have been complicit in corruption, and have led the drive to bring UWOs into action in UK law.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">UWOs are given legal effect pursuant to the UK Proceeds of Crime Act 2002 Article 362A, as introduced by the Criminal Finances Act 2017, and is defined in the legislation as:</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><em>‘An unexplained wealth order is an order requiring the respondent [i.e. the target of the order] to provide a statement—</em></p>\r\n\r\n<ul>\r\n 	<li><em>setting out the nature and extent of the respondent’s interest in the property in respect of which the order is made,</em></li>\r\n 	<li><em>explaining how the respondent obtained the property (including, in particular, how any costs incurred in obtaining it were met),</em></li>\r\n 	<li><em>where the property is held by the trustees of a settlement, setting out such details of the settlement as may be specified in the order, and</em></li>\r\n 	<li><em>setting out such other information in connection with the property as may be so specified.’</em></li>\r\n</ul>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">The clear advantage that UWOs provide for UK investigative authorities is that it is no longer necessary for the UK authorities to demonstrate that an individual has been subject to a conviction for a criminal offence (either in the UK or abroad) in order to obtain information and take measures against a specific property.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Two months after the introduction of the legislation, in March 2018, it would appear that the first orders are now being made. We have seen the first use of these orders, not on a UK national, but on an Asian politician who owns two properties, worth USD $30 million, in the UK. The specific identity of this individual has not been disclosed as matters are ongoing, and no further details are available publically.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">This means that if an individual owns assets in the UK and they are made subject to a UWO, they will be forced to declare how they obtained this asset, and if they fail to do so they would be subject to criminal prosecution by the UK authorities. This may lead to foreign individuals being stuck between a rock and a hard place, with nowhere to turn and no route of escape.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Why is it Relevant To You?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">As will be apparent from the first orders made against the Asian politician, whilst UWOs do apply to individuals who are reasonably suspected of being involved in crime, the UWOs will also target politically exposed individuals who have not been subject to criminal conviction, or investigation, either in the UK or internationally.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The definition of a PEP, or Politically Exposed Person, varies from State to State, but for the purposes of the UK legislation, the legislators have defined PEPs as the following:</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">‘(a) an individual who is, or has been, entrusted with prominent public functions by an international body or by a State other than the UK or other [European Economic Area] State;</p>\r\n<p dir=\"LTR\" align=\"LEFT\">(b) a family member of a person within paragraph (a); or</p>\r\n<p dir=\"LTR\" align=\"LEFT\">(c) known to be a close associate of a person within […] paragraph [a].’</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">Evidently from this definition, paying particularly close attention to (c) namely ‘a close associate’ of an individual with prominent public functions, there is a very expansive definition of PEP, and this will likely include many unsuspecting individuals. The effect of this definition is that if you are an individual who has prominent public functions, or you are a close associate of another who has been entrusted with public functions, then you may now be targeted by the UK authorities with a UWO. Alarmingly, there is no need for you to have committed a crime, nor to have been suspected of being involved in a crime, for these orders to apply to you.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Specifically, when could a UWO apply?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">A UK high court judge can give notice of a UWO if the judge is satisfied that it is likely that a foreign PEP (as defined above) is the owner of suspicious wealth in the UK beyond their means, and if all of the following provisions are met:</p>\r\n\r\n<ol>\r\n 	<li dir=\"LTR\">The respondent’s known income is insufficient to obtain the asset; and</li>\r\n 	<li dir=\"LTR\">The value of the asset is greater than £50,000 (approx. AED 260,000).</li>\r\n</ol>\r\n<p dir=\"LTR\" align=\"LEFT\">This legislation does not only target Foreign PEPs, but also where there are reasonable grounds to suspect any individual has been involved in serious crime.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Applications for UWOs may be made without notice. This means that there is no requirement on the UK investigative authority to notify the target of a UWO that they, or their assets, have been made subject of a UWO.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What assets would this apply to?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">A UWO can be made against assets whose value is greater than £50,000. There is no need for the PEP to be the sole owner of the property whose value is over £50,000, nor is it of relevance if the property was purchased prior to the introduction of the UK legislation.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What is the effect?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Following the making of an order by the High Court, the Court may order an individual’s property to be frozen, which would preclude the subject of the order from dealing with the property. As these freezing orders may be made without notice, this means that an individual’s assets may be frozen prior to their knowledge of any order being made against them.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The UWO will mandate the individual to explain, at a minimum:</p>\r\n\r\n<ol>\r\n 	<li dir=\"LTR\">The nature and extent of their interest in a particular property; and</li>\r\n 	<li dir=\"LTR\">Explain how the property was obtained.</li>\r\n</ol>\r\n<p dir=\"LTR\" align=\"LEFT\">An explanation will be requested by the UK authorities where ‘there are reasonable grounds to suspect that the respondent’s known lawfully obtained income would be insufficient to allow the respondent to obtain the property’.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Failing to Comply?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Should the target of a UWO fail to comply with an order, or provide inaccurate or misleading information, then they will likely be subject to criminal sanction in the UK and may face a period of imprisonment and a financial penalty.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Within the legislation, it is stated that a UWO could lead to criminal liability for a target if that individual fails, without reasonable excuse, to comply with the requirements imposed by the Court against that individual. There is no definition of what a reasonable excuse would be in the legislation, and is a subjective requirement that would be decided in Court during the course of litigation.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong><img class=\"wp-image-8014 size-medium alignright\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/Screen-Shot-2018-07-31-at-5.43.01-PM-242x300.png\" alt=\"\" width=\"242\" height=\"300\" />A View from the East: Stuck between a Rock and a Hard Place?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">These orders, whilst designed to tackle money laundering on a global scale, and limit the use of the UK jurisdiction for those who seek to gain from their ill-gotten earnings, may cause legal difficulties for individuals based in foreign jurisdictions who are subject to UWOs – such as the UAE and the wider GCC – due to a conflict of laws between this UK legislation and that of other countries. This conflict could lead to an individual’s adherence to UK legislation meaning that the individual would be liable to prosecution in other jurisdictions.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Taking the UAE as a representative example of the Middle East’s approach to confidential or private information, the UAE’s jurisdiction imposes very strict obligations on an individual’s use and disclosure of confidential information. It is a criminal offence, pursuant to the UAE’s Federal Law No. 3 of 1987, as amended by Federal Decree No. 7 of 2016 (UAE Penal Code) to disclose secret information. Secret information is afforded an expansive definition in the UAE Penal Code and it is commonly viewed any information that is confidential, i.e. not in the public domain, and that an individual possesses due to their employment or individual nature.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Furthermore, due to the extraterritorial nature of the UAE Penal Code, should an individual commit a crime that is wholly or partly committed within the UAE, then that individual would be bound by the provisions of the Penal Code, and would be bound by provisions such as the disclosure of secret information. Specifically, should an individual be requested to provide secret information, such as the source of funds from a business entity, to the UK authorities, and that information relates to a UAE business or UAE based individual, then if the material or information is disclosed following a UWO in the UK, then in the UAE the individual may be subject to criminal prosecution for disclosing that exact information.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">There is no exception afforded under UAE domestic legislation that would permit an individual to disclose confidential information to a foreign investigative authority (such as the UK’s Serious Fraud Office, Financial Conduct Authority, or National Security Agency). Should that individual disclose such information to the UK’s, or any other foreign State’s, investigative authority, then that individual may be liable to prosecution in the UAE in the same manner as though the disclosure had been made to a private individual or entity.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Prosecution for disclosing confidential information is a serious offence in the UAE, and one that may carry a mandatory minimum period of imprisonment. Accordingly, the stakes are very high when one is subject to an international request for judicial assistance, in any form, and it is for that reason and in order to assist with international criminal investigations that the UAE has entered into number multilateral and bilateral treaties aimed at assisting mutual judicial assistance requests. As with most international requests from law enforcement agencies, such requests should follow the usual diplomatic channels through the deployment of letters rogatory.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The difficulties for UAE individuals would not stop simply at the threat of criminal sanction, but also according to the UAE’s Labour Law, should an individual disclose the secrets of their employer, then the worker may be dismissed without notice and forfeit their entire severance pay.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Accordingly, the receipt of a UWO in the UK demanding that an individual provide information to the UAE authorities may conflict with the statutory protection relating to confidential information (or other laws) in a foreign jurisdiction, such as the UAE. This would lead to the precarious situation where an individual may face prosecution in the UK if he doesn’t comply with the UWO, but criminal prosecution in the UAE if he does comply.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Conclusion</strong></p>\r\nThe above example and review provides a very high-level overview of the competing laws that the UK’s UWOs may catch. Whilst the UK legislation will no doubt serve as an effective deterrent and useful tool in minimising global money laundering, and limiting the attraction of the UK for criminals, it may have unintended consequences for foreign nationals holding legitimate assets in the UK. Prior to making any response to a request for assistance, it is imperative that the recipient apprise themselves of all legal considerations to ensure that they are not jumping out of the frying pan, but straight into the fire.');
INSERT INTO `tm_wsal_metadata` (`id`, `occurrence_id`, `name`, `value`) VALUES
(261001, 25316, 'MetaValueOld', '<img class=\"alignleft size-full wp-image-8002\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/17-1.png\" alt=\"\" width=\"3567\" height=\"715\" />\r\n</br><p dir=\"LTR\" align=\"LEFT\">The UK legislature has recently introduced domestic legislation aimed at money launderers, potentially resulting in unintended consequences for foreign nationals who have legitimate assets in the UK. These orders demand the intended target provide information about the origin of their wealth, and refusal to disclose that information may render the target subject to criminal prosecution in the UK. However, if the foreign national does comply with the Unexplained Wealth Order (UWO), then that individual may be subject to criminal prosecution in another State… a real Catch 22.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Controversially, there is no need for a foreign national to be accused of money laundering, or any criminality whatsoever, before they could be made subject to a UWO, which would lead to the freezing of their assets, or, worse, criminal prosecution.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The following article introduces UWOs to our clients and examines how one must be careful in weighing up their rights and obligations in respect of the request of a foreign State’s investigative authorities as it may impact their rights in the UAE, and around the GCC.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What is a UWO?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">On 31st January 2018, the UK introduced their latest attempt at stemming money laundering in the UK: Unexplained Wealth Orders. UWOs are civil investigative powers that are aimed at tackling those who use the UK as a destination for money laundering, or as a destination for those who wish to spend their ill-gotten gains.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">UWOs have been introduced in the UK at a time when London, and the UK, is facing scrutiny as a perceived hotbed of money laundering and revelry. A main proponent of UWOs has been Transparency International UK’s corruption taskforce, who, amongst others, have repeatedly called for greater investigative action to be taken in the UK against individuals and entities thought to have been complicit in corruption, and have led the drive to bring UWOs into action in UK law.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">UWOs are given legal effect pursuant to the UK Proceeds of Crime Act 2002 Article 362A, as introduced by the Criminal Finances Act 2017, and is defined in the legislation as:</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><em>‘An unexplained wealth order is an order requiring the respondent [i.e. the target of the order] to provide a statement—</em></p>\r\n\r\n<ul>\r\n 	<li><em>setting out the nature and extent of the respondent’s interest in the property in respect of which the order is made,</em></li>\r\n 	<li><em>explaining how the respondent obtained the property (including, in particular, how any costs incurred in obtaining it were met),</em></li>\r\n 	<li><em>where the property is held by the trustees of a settlement, setting out such details of the settlement as may be specified in the order, and</em></li>\r\n 	<li><em>setting out such other information in connection with the property as may be so specified.’</em></li>\r\n</ul>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">The clear advantage that UWOs provide for UK investigative authorities is that it is no longer necessary for the UK authorities to demonstrate that an individual has been subject to a conviction for a criminal offence (either in the UK or abroad) in order to obtain information and take measures against a specific property.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Two months after the introduction of the legislation, in March 2018, it would appear that the first orders are now being made. We have seen the first use of these orders, not on a UK national, but on an Asian politician who owns two properties, worth USD $30 million, in the UK. The specific identity of this individual has not been disclosed as matters are ongoing, and no further details are available publically.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">This means that if an individual owns assets in the UK and they are made subject to a UWO, they will be forced to declare how they obtained this asset, and if they fail to do so they would be subject to criminal prosecution by the UK authorities. This may lead to foreign individuals being stuck between a rock and a hard place, with nowhere to turn and no route of escape.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Why is it Relevant To You?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">As will be apparent from the first orders made against the Asian politician, whilst UWOs do apply to individuals who are reasonably suspected of being involved in crime, the UWOs will also target politically exposed individuals who have not been subject to criminal conviction, or investigation, either in the UK or internationally.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The definition of a PEP, or Politically Exposed Person, varies from State to State, but for the purposes of the UK legislation, the legislators have defined PEPs as the following:</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">‘(a) an individual who is, or has been, entrusted with prominent public functions by an international body or by a State other than the UK or other [European Economic Area] State;</p>\r\n<p dir=\"LTR\" align=\"LEFT\">(b) a family member of a person within paragraph (a); or</p>\r\n<p dir=\"LTR\" align=\"LEFT\">(c) known to be a close associate of a person within […] paragraph [a].’</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">Evidently from this definition, paying particularly close attention to (c) namely ‘a close associate’ of an individual with prominent public functions, there is a very expansive definition of PEP, and this will likely include many unsuspecting individuals. The effect of this definition is that if you are an individual who has prominent public functions, or you are a close associate of another who has been entrusted with public functions, then you may now be targeted by the UK authorities with a UWO. Alarmingly, there is no need for you to have committed a crime, nor to have been suspected of being involved in a crime, for these orders to apply to you.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Specifically, when could a UWO apply?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">A UK high court judge can give notice of a UWO if the judge is satisfied that it is likely that a foreign PEP (as defined above) is the owner of suspicious wealth in the UK beyond their means, and if all of the following provisions are met:</p>\r\n\r\n<ol>\r\n 	<li dir=\"LTR\">The respondent’s known income is insufficient to obtain the asset; and</li>\r\n 	<li dir=\"LTR\">The value of the asset is greater than £50,000 (approx. AED 260,000).</li>\r\n</ol>\r\n<p dir=\"LTR\" align=\"LEFT\">This legislation does not only target Foreign PEPs, but also where there are reasonable grounds to suspect any individual has been involved in serious crime.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Applications for UWOs may be made without notice. This means that there is no requirement on the UK investigative authority to notify the target of a UWO that they, or their assets, have been made subject of a UWO.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What assets would this apply to?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">A UWO can be made against assets whose value is greater than £50,000. There is no need for the PEP to be the sole owner of the property whose value is over £50,000, nor is it of relevance if the property was purchased prior to the introduction of the UK legislation.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What is the effect?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Following the making of an order by the High Court, the Court may order an individual’s property to be frozen, which would preclude the subject of the order from dealing with the property. As these freezing orders may be made without notice, this means that an individual’s assets may be frozen prior to their knowledge of any order being made against them.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The UWO will mandate the individual to explain, at a minimum:</p>\r\n\r\n<ol>\r\n 	<li dir=\"LTR\">The nature and extent of their interest in a particular property; and</li>\r\n 	<li dir=\"LTR\">Explain how the property was obtained.</li>\r\n</ol>\r\n<p dir=\"LTR\" align=\"LEFT\">An explanation will be requested by the UK authorities where ‘there are reasonable grounds to suspect that the respondent’s known lawfully obtained income would be insufficient to allow the respondent to obtain the property’.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Failing to Comply?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Should the target of a UWO fail to comply with an order, or provide inaccurate or misleading information, then they will likely be subject to criminal sanction in the UK and may face a period of imprisonment and a financial penalty.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Within the legislation, it is stated that a UWO could lead to criminal liability for a target if that individual fails, without reasonable excuse, to comply with the requirements imposed by the Court against that individual. There is no definition of what a reasonable excuse would be in the legislation, and is a subjective requirement that would be decided in Court during the course of litigation.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong><img class=\"wp-image-8014 size-medium alignright\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/Screen-Shot-2018-07-31-at-5.43.01-PM-242x300.png\" alt=\"\" width=\"242\" height=\"300\" />A View from the East: Stuck between a Rock and a Hard Place?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">These orders, whilst designed to tackle money laundering on a global scale, and limit the use of the UK jurisdiction for those who seek to gain from their ill-gotten earnings, may cause legal difficulties for individuals based in foreign jurisdictions who are subject to UWOs – such as the UAE and the wider GCC – due to a conflict of laws between this UK legislation and that of other countries. This conflict could lead to an individual’s adherence to UK legislation meaning that the individual would be liable to prosecution in other jurisdictions.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Taking the UAE as a representative example of the Middle East’s approach to confidential or private information, the UAE’s jurisdiction imposes very strict obligations on an individual’s use and disclosure of confidential information. It is a criminal offence, pursuant to the UAE’s Federal Law No. 3 of 1987, as amended by Federal Decree No. 7 of 2016 (UAE Penal Code) to disclose secret information. Secret information is afforded an expansive definition in the UAE Penal Code and it is commonly viewed any information that is confidential, i.e. not in the public domain, and that an individual possesses due to their employment or individual nature.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Furthermore, due to the extraterritorial nature of the UAE Penal Code, should an individual commit a crime that is wholly or partly committed within the UAE, then that individual would be bound by the provisions of the Penal Code, and would be bound by provisions such as the disclosure of secret information. Specifically, should an individual be requested to provide secret information, such as the source of funds from a business entity, to the UK authorities, and that information relates to a UAE business or UAE based individual, then if the material or information is disclosed following a UWO in the UK, then in the UAE the individual may be subject to criminal prosecution for disclosing that exact information.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">There is no exception afforded under UAE domestic legislation that would permit an individual to disclose confidential information to a foreign investigative authority (such as the UK’s Serious Fraud Office, Financial Conduct Authority, or National Security Agency). Should that individual disclose such information to the UK’s, or any other foreign State’s, investigative authority, then that individual may be liable to prosecution in the UAE in the same manner as though the disclosure had been made to a private individual or entity.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Prosecution for disclosing confidential information is a serious offence in the UAE, and one that may carry a mandatory minimum period of imprisonment. Accordingly, the stakes are very high when one is subject to an international request for judicial assistance, in any form, and it is for that reason and in order to assist with international criminal investigations that the UAE has entered into number multilateral and bilateral treaties aimed at assisting mutual judicial assistance requests. As with most international requests from law enforcement agencies, such requests should follow the usual diplomatic channels through the deployment of letters rogatory.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The difficulties for UAE individuals would not stop simply at the threat of criminal sanction, but also according to the UAE’s Labour Law, should an individual disclose the secrets of their employer, then the worker may be dismissed without notice and forfeit their entire severance pay.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Accordingly, the receipt of a UWO in the UK demanding that an individual provide information to the UAE authorities may conflict with the statutory protection relating to confidential information (or other laws) in a foreign jurisdiction, such as the UAE. This would lead to the precarious situation where an individual may face prosecution in the UK if he doesn’t comply with the UWO, but criminal prosecution in the UAE if he does comply.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Conclusion</strong></p>\r\nThe above example and review provides a very high-level overview of the competing laws that the UK’s UWOs may catch. Whilst the UK legislation will no doubt serve as an effective deterrent and useful tool in minimising global money laundering, and limiting the attraction of the UK for criminals, it may have unintended consequences for foreign nationals holding legitimate assets in the UK. Prior to making any response to a request for assistance, it is imperative that the recipient apprise themselves of all legal considerations to ensure that they are not jumping out of the frying pan, but straight into the fire.'),
(261002, 25316, 'MetaLink', 'content'),
(261003, 25316, 'EditorLinkPost', 'https://www.tamimi.com/wp-admin/post.php?post=7940&amp;action=edit'),
(261004, 25316, 'ReportText', '<img class=\"alignleft size-full wp-image-8002\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/17-1.png\" alt=\"\" width=\"3567\" height=\"715\" />\r\n</br><p dir=\"LTR\" align=\"LEFT\">The UK legislature has recently introduced domestic legislation aimed at money launderers, potentially resulting in unintended consequences for foreign nationals who have legitimate assets in the UK. These orders demand the intended target provide information about the origin of their wealth, and refusal to disclose that information may render the target subject to criminal prosecution in the UK. However, if the foreign national does comply with the Unexplained Wealth Order (UWO), then that individual may be subject to criminal prosecution in another State… a real Catch 22.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Controversially, there is no need for a foreign national to be accused of money laundering, or any criminality whatsoever, before they could be made subject to a UWO, which would lead to the freezing of their assets, or, worse, criminal prosecution.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The following article introduces UWOs to our clients and examines how one must be careful in weighing up their rights and obligations in respect of the request of a foreign State’s investigative authorities as it may impact their rights in the UAE, and around the GCC.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What is a UWO?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">On 31st January 2018, the UK introduced their latest attempt at stemming money laundering in the UK: Unexplained Wealth Orders. UWOs are civil investigative powers that are aimed at tackling those who use the UK as a destination for money laundering, or as a destination for those who wish to spend their ill-gotten gains.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">UWOs have been introduced in the UK at a time when London, and the UK, is facing scrutiny as a perceived hotbed of money laundering and revelry. A main proponent of UWOs has been Transparency International UK’s corruption taskforce, who, amongst others, have repeatedly called for greater investigative action to be taken in the UK against individuals and entities thought to have been complicit in corruption, and have led the drive to bring UWOs into action in UK law.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">UWOs are given legal effect pursuant to the UK Proceeds of Crime Act 2002 Article 362A, as introduced by the Criminal Finances Act 2017, and is defined in the legislation as:</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><em>‘An unexplained wealth order is an order requiring the respondent [i.e. the target of the order] to provide a statement—</em></p>\r\n\r\n<ul>\r\n 	<li><em>setting out the nature and extent of the respondent’s interest in the property in respect of which the order is made,</em></li>\r\n 	<li><em>explaining how the respondent obtained the property (including, in particular, how any costs incurred in obtaining it were met),</em></li>\r\n 	<li><em>where the property is held by the trustees of a settlement, setting out such details of the settlement as may be specified in the order, and</em></li>\r\n 	<li><em>setting out such other information in connection with the property as may be so specified.’</em></li>\r\n</ul>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">The clear advantage that UWOs provide for UK investigative authorities is that it is no longer necessary for the UK authorities to demonstrate that an individual has been subject to a conviction for a criminal offence (either in the UK or abroad) in order to obtain information and take measures against a specific property.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Two months after the introduction of the legislation, in March 2018, it would appear that the first orders are now being made. We have seen the first use of these orders, not on a UK national, but on an Asian politician who owns two properties, worth USD $30 million, in the UK. The specific identity of this individual has not been disclosed as matters are ongoing, and no further details are available publically.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">This means that if an individual owns assets in the UK and they are made subject to a UWO, they will be forced to declare how they obtained this asset, and if they fail to do so they would be subject to criminal prosecution by the UK authorities. This may lead to foreign individuals being stuck between a rock and a hard place, with nowhere to turn and no route of escape.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Why is it Relevant To You?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">As will be apparent from the first orders made against the Asian politician, whilst UWOs do apply to individuals who are reasonably suspected of being involved in crime, the UWOs will also target politically exposed individuals who have not been subject to criminal conviction, or investigation, either in the UK or internationally.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The definition of a PEP, or Politically Exposed Person, varies from State to State, but for the purposes of the UK legislation, the legislators have defined PEPs as the following:</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">‘(a) an individual who is, or has been, entrusted with prominent public functions by an international body or by a State other than the UK or other [European Economic Area] State;</p>\r\n<p dir=\"LTR\" align=\"LEFT\">(b) a family member of a person within paragraph (a); or</p>\r\n<p dir=\"LTR\" align=\"LEFT\">(c) known to be a close associate of a person within […] paragraph [a].’</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">Evidently from this definition, paying particularly close attention to (c) namely ‘a close associate’ of an individual with prominent public functions, there is a very expansive definition of PEP, and this will likely include many unsuspecting individuals. The effect of this definition is that if you are an individual who has prominent public functions, or you are a close associate of another who has been entrusted with public functions, then you may now be targeted by the UK authorities with a UWO. Alarmingly, there is no need for you to have committed a crime, nor to have been suspected of being involved in a crime, for these orders to apply to you.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Specifically, when could a UWO apply?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">A UK high court judge can give notice of a UWO if the judge is satisfied that it is likely that a foreign PEP (as defined above) is the owner of suspicious wealth in the UK beyond their means, and if all of the following provisions are met:</p>\r\n\r\n<ol>\r\n 	<li dir=\"LTR\">The respondent’s known income is insufficient to obtain the asset; and</li>\r\n 	<li dir=\"LTR\">The value of the asset is greater than £50,000 (approx. AED 260,000).</li>\r\n</ol>\r\n<p dir=\"LTR\" align=\"LEFT\">This legislation does not only target Foreign PEPs, but also where there are reasonable grounds to suspect any individual has been involved in serious crime.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Applications for UWOs may be made without notice. This means that there is no requirement on the UK investigative authority to notify the target of a UWO that they, or their assets, have been made subject of a UWO.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What assets would this apply to?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">A UWO can be made against assets whose value is greater than £50,000. There is no need for the PEP to be the sole owner of the property whose value is over £50,000, nor is it of relevance if the property was purchased prior to the introduction of the UK legislation.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What is the effect?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Following the making of an order by the High Court, the Court may order an individual’s property to be frozen, which would preclude the subject of the order from dealing with the property. As these freezing orders may be made without notice, this means that an individual’s assets may be frozen prior to their knowledge of any order being made against them.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The UWO will mandate the individual to explain, at a minimum:</p>\r\n\r\n<ol>\r\n 	<li dir=\"LTR\">The nature and extent of their interest in a particular property; and</li>\r\n 	<li dir=\"LTR\">Explain how the property was obtained.</li>\r\n</ol>\r\n<p dir=\"LTR\" align=\"LEFT\">An explanation will be requested by the UK authorities where ‘there are reasonable grounds to suspect that the respondent’s known lawfully obtained income would be insufficient to allow the respondent to obtain the property’.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Failing to Comply?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Should the target of a UWO fail to comply with an order, or provide inaccurate or misleading information, then they will likely be subject to criminal sanction in the UK and may face a period of imprisonment and a financial penalty.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Within the legislation, it is stated that a UWO could lead to criminal liability for a target if that individual fails, without reasonable excuse, to comply with the requirements imposed by the Court against that individual. There is no definition of what a reasonable excuse would be in the legislation, and is a subjective requirement that would be decided in Court during the course of litigation.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong><img class=\"wp-image-8014 size-medium alignright\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/Screen-Shot-2018-07-31-at-5.43.01-PM-242x300.png\" alt=\"\" width=\"242\" height=\"300\" />A View from the East: Stuck between a Rock and a Hard Place?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">These orders, whilst designed to tackle money laundering on a global scale, and limit the use of the UK jurisdiction for those who seek to gain from their ill-gotten earnings, may cause legal difficulties for individuals based in foreign jurisdictions who are subject to UWOs – such as the UAE and the wider GCC – due to a conflict of laws between this UK legislation and that of other countries. This conflict could lead to an individual’s adherence to UK legislation meaning that the individual would be liable to prosecution in other jurisdictions.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Taking the UAE as a representative example of the Middle East’s approach to confidential or private information, the UAE’s jurisdiction imposes very strict obligations on an individual’s use and disclosure of confidential information. It is a criminal offence, pursuant to the UAE’s Federal Law No. 3 of 1987, as amended by Federal Decree No. 7 of 2016 (UAE Penal Code) to disclose secret information. Secret information is afforded an expansive definition in the UAE Penal Code and it is commonly viewed any information that is confidential, i.e. not in the public domain, and that an individual possesses due to their employment or individual nature.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Furthermore, due to the extraterritorial nature of the UAE Penal Code, should an individual commit a crime that is wholly or partly committed within the UAE, then that individual would be bound by the provisions of the Penal Code, and would be bound by provisions such as the disclosure of secret information. Specifically, should an individual be requested to provide secret information, such as the source of funds from a business entity, to the UK authorities, and that information relates to a UAE business or UAE based individual, then if the material or information is disclosed following a UWO in the UK, then in the UAE the individual may be subject to criminal prosecution for disclosing that exact information.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">There is no exception afforded under UAE domestic legislation that would permit an individual to disclose confidential information to a foreign investigative authority (such as the UK’s Serious Fraud Office, Financial Conduct Authority, or National Security Agency). Should that individual disclose such information to the UK’s, or any other foreign State’s, investigative authority, then that individual may be liable to prosecution in the UAE in the same manner as though the disclosure had been made to a private individual or entity.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Prosecution for disclosing confidential information is a serious offence in the UAE, and one that may carry a mandatory minimum period of imprisonment. Accordingly, the stakes are very high when one is subject to an international request for judicial assistance, in any form, and it is for that reason and in order to assist with international criminal investigations that the UAE has entered into number multilateral and bilateral treaties aimed at assisting mutual judicial assistance requests. As with most international requests from law enforcement agencies, such requests should follow the usual diplomatic channels through the deployment of letters rogatory.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The difficulties for UAE individuals would not stop simply at the threat of criminal sanction, but also according to the UAE’s Labour Law, should an individual disclose the secrets of their employer, then the worker may be dismissed without notice and forfeit their entire severance pay.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Accordingly, the receipt of a UWO in the UK demanding that an individual provide information to the UAE authorities may conflict with the statutory protection relating to confidential information (or other laws) in a foreign jurisdiction, such as the UAE. This would lead to the precarious situation where an individual may face prosecution in the UK if he doesn’t comply with the UWO, but criminal prosecution in the UAE if he does comply.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Conclusion</strong></p>\r\nThe above example and review provides a very high-level overview of the competing laws that the UK’s UWOs may catch. Whilst the UK legislation will no doubt serve as an effective deterrent and useful tool in minimising global money laundering, and limiting the attraction of the UK for criminals, it may have unintended consequences for foreign nationals holding legitimate assets in the UK. Prior to making any response to a request for assistance, it is imperative that the recipient apprise themselves of all legal considerations to ensure that they are not jumping out of the frying pan, but straight into the fire.|<img class=\"alignleft size-full wp-image-8002\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/17-1.png\" alt=\"\" width=\"3567\" height=\"715\" />\r\n\r\n</br>The UK legislature has recently introduced domestic legislation aimed at money launderers, potentially resulting in unintended consequences for foreign nationals who have legitimate assets in the UK. These orders demand the intended target provide information about the origin of their wealth, and refusal to disclose that information may render the target subject to criminal prosecution in the UK. However, if the foreign national does comply with the Unexplained Wealth Order (UWO), then that individual may be subject to criminal prosecution in another State… a real Catch 22.\r\n<p dir=\"LTR\" align=\"LEFT\">Controversially, there is no need for a foreign national to be accused of money laundering, or any criminality whatsoever, before they could be made subject to a UWO, which would lead to the freezing of their assets, or, worse, criminal prosecution.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The following article introduces UWOs to our clients and examines how one must be careful in weighing up their rights and obligations in respect of the request of a foreign State’s investigative authorities as it may impact their rights in the UAE, and around the GCC.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What is a UWO?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">On 31st January 2018, the UK introduced their latest attempt at stemming money laundering in the UK: Unexplained Wealth Orders. UWOs are civil investigative powers that are aimed at tackling those who use the UK as a destination for money laundering, or as a destination for those who wish to spend their ill-gotten gains.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">UWOs have been introduced in the UK at a time when London, and the UK, is facing scrutiny as a perceived hotbed of money laundering and revelry. A main proponent of UWOs has been Transparency International UK’s corruption taskforce, who, amongst others, have repeatedly called for greater investigative action to be taken in the UK against individuals and entities thought to have been complicit in corruption, and have led the drive to bring UWOs into action in UK law.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">UWOs are given legal effect pursuant to the UK Proceeds of Crime Act 2002 Article 362A, as introduced by the Criminal Finances Act 2017, and is defined in the legislation as:</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><em>‘An unexplained wealth order is an order requiring the respondent [i.e. the target of the order] to provide a statement—</em></p>\r\n\r\n<ul>\r\n 	<li><em>setting out the nature and extent of the respondent’s interest in the property in respect of which the order is made,</em></li>\r\n 	<li><em>explaining how the respondent obtained the property (including, in particular, how any costs incurred in obtaining it were met),</em></li>\r\n 	<li><em>where the property is held by the trustees of a settlement, setting out such details of the settlement as may be specified in the order, and</em></li>\r\n 	<li><em>setting out such other information in connection with the property as may be so specified.’</em></li>\r\n</ul>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">The clear advantage that UWOs provide for UK investigative authorities is that it is no longer necessary for the UK authorities to demonstrate that an individual has been subject to a conviction for a criminal offence (either in the UK or abroad) in order to obtain information and take measures against a specific property.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Two months after the introduction of the legislation, in March 2018, it would appear that the first orders are now being made. We have seen the first use of these orders, not on a UK national, but on an Asian politician who owns two properties, worth USD $30 million, in the UK. The specific identity of this individual has not been disclosed as matters are ongoing, and no further details are available publically.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">This means that if an individual owns assets in the UK and they are made subject to a UWO, they will be forced to declare how they obtained this asset, and if they fail to do so they would be subject to criminal prosecution by the UK authorities. This may lead to foreign individuals being stuck between a rock and a hard place, with nowhere to turn and no route of escape.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Why is it Relevant To You?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">As will be apparent from the first orders made against the Asian politician, whilst UWOs do apply to individuals who are reasonably suspected of being involved in crime, the UWOs will also target politically exposed individuals who have not been subject to criminal conviction, or investigation, either in the UK or internationally.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The definition of a PEP, or Politically Exposed Person, varies from State to State, but for the purposes of the UK legislation, the legislators have defined PEPs as the following:</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">‘(a) an individual who is, or has been, entrusted with prominent public functions by an international body or by a State other than the UK or other [European Economic Area] State;</p>\r\n<p dir=\"LTR\" align=\"LEFT\">(b) a family member of a person within paragraph (a); or</p>\r\n<p dir=\"LTR\" align=\"LEFT\">(c) known to be a close associate of a person within […] paragraph [a].’</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">Evidently from this definition, paying particularly close attention to (c) namely ‘a close associate’ of an individual with prominent public functions, there is a very expansive definition of PEP, and this will likely include many unsuspecting individuals. The effect of this definition is that if you are an individual who has prominent public functions, or you are a close associate of another who has been entrusted with public functions, then you may now be targeted by the UK authorities with a UWO. Alarmingly, there is no need for you to have committed a crime, nor to have been suspected of being involved in a crime, for these orders to apply to you.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Specifically, when could a UWO apply?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">A UK high court judge can give notice of a UWO if the judge is satisfied that it is likely that a foreign PEP (as defined above) is the owner of suspicious wealth in the UK beyond their means, and if all of the following provisions are met:</p>\r\n\r\n<ol>\r\n 	<li dir=\"LTR\">The respondent’s known income is insufficient to obtain the asset; and</li>\r\n 	<li dir=\"LTR\">The value of the asset is greater than £50,000 (approx. AED 260,000).</li>\r\n</ol>\r\n<p dir=\"LTR\" align=\"LEFT\">This legislation does not only target Foreign PEPs, but also where there are reasonable grounds to suspect any individual has been involved in serious crime.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Applications for UWOs may be made without notice. This means that there is no requirement on the UK investigative authority to notify the target of a UWO that they, or their assets, have been made subject of a UWO.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What assets would this apply to?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">A UWO can be made against assets whose value is greater than £50,000. There is no need for the PEP to be the sole owner of the property whose value is over £50,000, nor is it of relevance if the property was purchased prior to the introduction of the UK legislation.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What is the effect?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Following the making of an order by the High Court, the Court may order an individual’s property to be frozen, which would preclude the subject of the order from dealing with the property. As these freezing orders may be made without notice, this means that an individual’s assets may be frozen prior to their knowledge of any order being made against them.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The UWO will mandate the individual to explain, at a minimum:</p>\r\n\r\n<ol>\r\n 	<li dir=\"LTR\">The nature and extent of their interest in a particular property; and</li>\r\n 	<li dir=\"LTR\">Explain how the property was obtained.</li>\r\n</ol>\r\n<p dir=\"LTR\" align=\"LEFT\">An explanation will be requested by the UK authorities where ‘there are reasonable grounds to suspect that the respondent’s known lawfully obtained income would be insufficient to allow the respondent to obtain the property’.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Failing to Comply?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Should the target of a UWO fail to comply with an order, or provide inaccurate or misleading information, then they will likely be subject to criminal sanction in the UK and may face a period of imprisonment and a financial penalty.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Within the legislation, it is stated that a UWO could lead to criminal liability for a target if that individual fails, without reasonable excuse, to comply with the requirements imposed by the Court against that individual. There is no definition of what a reasonable excuse would be in the legislation, and is a subjective requirement that would be decided in Court during the course of litigation.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong><img class=\"wp-image-8014 size-medium alignright\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/Screen-Shot-2018-07-31-at-5.43.01-PM-242x300.png\" alt=\"\" width=\"242\" height=\"300\" />A View from the East: Stuck between a Rock and a Hard Place?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">These orders, whilst designed to tackle money laundering on a global scale, and limit the use of the UK jurisdiction for those who seek to gain from their ill-gotten earnings, may cause legal difficulties for individuals based in foreign jurisdictions who are subject to UWOs – such as the UAE and the wider GCC – due to a conflict of laws between this UK legislation and that of other countries. This conflict could lead to an individual’s adherence to UK legislation meaning that the individual would be liable to prosecution in other jurisdictions.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Taking the UAE as a representative example of the Middle East’s approach to confidential or private information, the UAE’s jurisdiction imposes very strict obligations on an individual’s use and disclosure of confidential information. It is a criminal offence, pursuant to the UAE’s Federal Law No. 3 of 1987, as amended by Federal Decree No. 7 of 2016 (UAE Penal Code) to disclose secret information. Secret information is afforded an expansive definition in the UAE Penal Code and it is commonly viewed any information that is confidential, i.e. not in the public domain, and that an individual possesses due to their employment or individual nature.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Furthermore, due to the extraterritorial nature of the UAE Penal Code, should an individual commit a crime that is wholly or partly committed within the UAE, then that individual would be bound by the provisions of the Penal Code, and would be bound by provisions such as the disclosure of secret information. Specifically, should an individual be requested to provide secret information, such as the source of funds from a business entity, to the UK authorities, and that information relates to a UAE business or UAE based individual, then if the material or information is disclosed following a UWO in the UK, then in the UAE the individual may be subject to criminal prosecution for disclosing that exact information.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">There is no exception afforded under UAE domestic legislation that would permit an individual to disclose confidential information to a foreign investigative authority (such as the UK’s Serious Fraud Office, Financial Conduct Authority, or National Security Agency). Should that individual disclose such information to the UK’s, or any other foreign State’s, investigative authority, then that individual may be liable to prosecution in the UAE in the same manner as though the disclosure had been made to a private individual or entity.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Prosecution for disclosing confidential information is a serious offence in the UAE, and one that may carry a mandatory minimum period of imprisonment. Accordingly, the stakes are very high when one is subject to an international request for judicial assistance, in any form, and it is for that reason and in order to assist with international criminal investigations that the UAE has entered into number multilateral and bilateral treaties aimed at assisting mutual judicial assistance requests. As with most international requests from law enforcement agencies, such requests should follow the usual diplomatic channels through the deployment of letters rogatory.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The difficulties for UAE individuals would not stop simply at the threat of criminal sanction, but also according to the UAE’s Labour Law, should an individual disclose the secrets of their employer, then the worker may be dismissed without notice and forfeit their entire severance pay.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Accordingly, the receipt of a UWO in the UK demanding that an individual provide information to the UAE authorities may conflict with the statutory protection relating to confidential information (or other laws) in a foreign jurisdiction, such as the UAE. This would lead to the precarious situation where an individual may face prosecution in the UK if he doesn’t comply with the UWO, but criminal prosecution in the UAE if he does comply.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Conclusion</strong></p>\r\nThe above example and review provides a very high-level overview of the competing laws that the UK’s UWOs may catch. Whilst the UK legislation will no doubt serve as an effective deterrent and useful tool in minimising global money laundering, and limiting the attraction of the UK for criminals, it may have unintended consequences for foreign nationals holding legitimate assets in the UK. Prior to making any response to a request for assistance, it is imperative that the recipient apprise themselves of all legal considerations to ensure that they are not jumping out of the frying pan, but straight into the fire.'),
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(261061, 25321, 'MetaValueNew', '<img class=\"alignleft size-full wp-image-8002\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/17-1.png\" alt=\"\" width=\"3567\" height=\"715\" />\r\n\r\n&nbsp;\r\n\r\nThe UK legislature has recently introduced domestic legislation aimed at money launderers, potentially resulting in unintended consequences for foreign nationals who have legitimate assets in the UK. These orders demand the intended target provide information about the origin of their wealth, and refusal to disclose that information may render the target subject to criminal prosecution in the UK. However, if the foreign national does comply with the Unexplained Wealth Order (UWO), then that individual may be subject to criminal prosecution in another State… a real Catch 22.\r\n\r\n<p dir=\"LTR\" align=\"LEFT\">Controversially, there is no need for a foreign national to be accused of money laundering, or any criminality whatsoever, before they could be made subject to a UWO, which would lead to the freezing of their assets, or, worse, criminal prosecution.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The following article introduces UWOs to our clients and examines how one must be careful in weighing up their rights and obligations in respect of the request of a foreign State’s investigative authorities as it may impact their rights in the UAE, and around the GCC.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What is a UWO?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">On 31st January 2018, the UK introduced their latest attempt at stemming money laundering in the UK: Unexplained Wealth Orders. UWOs are civil investigative powers that are aimed at tackling those who use the UK as a destination for money laundering, or as a destination for those who wish to spend their ill-gotten gains.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">UWOs have been introduced in the UK at a time when London, and the UK, is facing scrutiny as a perceived hotbed of money laundering and revelry. A main proponent of UWOs has been Transparency International UK’s corruption taskforce, who, amongst others, have repeatedly called for greater investigative action to be taken in the UK against individuals and entities thought to have been complicit in corruption, and have led the drive to bring UWOs into action in UK law.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">UWOs are given legal effect pursuant to the UK Proceeds of Crime Act 2002 Article 362A, as introduced by the Criminal Finances Act 2017, and is defined in the legislation as:</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><em>‘An unexplained wealth order is an order requiring the respondent [i.e. the target of the order] to provide a statement—</em></p>\r\n\r\n<ul>\r\n 	<li><em>setting out the nature and extent of the respondent’s interest in the property in respect of which the order is made,</em></li>\r\n 	<li><em>explaining how the respondent obtained the property (including, in particular, how any costs incurred in obtaining it were met),</em></li>\r\n 	<li><em>where the property is held by the trustees of a settlement, setting out such details of the settlement as may be specified in the order, and</em></li>\r\n 	<li><em>setting out such other information in connection with the property as may be so specified.’</em></li>\r\n</ul>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">The clear advantage that UWOs provide for UK investigative authorities is that it is no longer necessary for the UK authorities to demonstrate that an individual has been subject to a conviction for a criminal offence (either in the UK or abroad) in order to obtain information and take measures against a specific property.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Two months after the introduction of the legislation, in March 2018, it would appear that the first orders are now being made. We have seen the first use of these orders, not on a UK national, but on an Asian politician who owns two properties, worth USD $30 million, in the UK. The specific identity of this individual has not been disclosed as matters are ongoing, and no further details are available publically.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">This means that if an individual owns assets in the UK and they are made subject to a UWO, they will be forced to declare how they obtained this asset, and if they fail to do so they would be subject to criminal prosecution by the UK authorities. This may lead to foreign individuals being stuck between a rock and a hard place, with nowhere to turn and no route of escape.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Why is it Relevant To You?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">As will be apparent from the first orders made against the Asian politician, whilst UWOs do apply to individuals who are reasonably suspected of being involved in crime, the UWOs will also target politically exposed individuals who have not been subject to criminal conviction, or investigation, either in the UK or internationally.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The definition of a PEP, or Politically Exposed Person, varies from State to State, but for the purposes of the UK legislation, the legislators have defined PEPs as the following:</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">‘(a) an individual who is, or has been, entrusted with prominent public functions by an international body or by a State other than the UK or other [European Economic Area] State;</p>\r\n<p dir=\"LTR\" align=\"LEFT\">(b) a family member of a person within paragraph (a); or</p>\r\n<p dir=\"LTR\" align=\"LEFT\">(c) known to be a close associate of a person within […] paragraph [a].’</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">Evidently from this definition, paying particularly close attention to (c) namely ‘a close associate’ of an individual with prominent public functions, there is a very expansive definition of PEP, and this will likely include many unsuspecting individuals. The effect of this definition is that if you are an individual who has prominent public functions, or you are a close associate of another who has been entrusted with public functions, then you may now be targeted by the UK authorities with a UWO. Alarmingly, there is no need for you to have committed a crime, nor to have been suspected of being involved in a crime, for these orders to apply to you.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Specifically, when could a UWO apply?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">A UK high court judge can give notice of a UWO if the judge is satisfied that it is likely that a foreign PEP (as defined above) is the owner of suspicious wealth in the UK beyond their means, and if all of the following provisions are met:</p>\r\n\r\n<ol>\r\n 	<li dir=\"LTR\">The respondent’s known income is insufficient to obtain the asset; and</li>\r\n 	<li dir=\"LTR\">The value of the asset is greater than £50,000 (approx. AED 260,000).</li>\r\n</ol>\r\n<p dir=\"LTR\" align=\"LEFT\">This legislation does not only target Foreign PEPs, but also where there are reasonable grounds to suspect any individual has been involved in serious crime.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Applications for UWOs may be made without notice. This means that there is no requirement on the UK investigative authority to notify the target of a UWO that they, or their assets, have been made subject of a UWO.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What assets would this apply to?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">A UWO can be made against assets whose value is greater than £50,000. There is no need for the PEP to be the sole owner of the property whose value is over £50,000, nor is it of relevance if the property was purchased prior to the introduction of the UK legislation.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What is the effect?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Following the making of an order by the High Court, the Court may order an individual’s property to be frozen, which would preclude the subject of the order from dealing with the property. As these freezing orders may be made without notice, this means that an individual’s assets may be frozen prior to their knowledge of any order being made against them.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The UWO will mandate the individual to explain, at a minimum:</p>\r\n\r\n<ol>\r\n 	<li dir=\"LTR\">The nature and extent of their interest in a particular property; and</li>\r\n 	<li dir=\"LTR\">Explain how the property was obtained.</li>\r\n</ol>\r\n<p dir=\"LTR\" align=\"LEFT\">An explanation will be requested by the UK authorities where ‘there are reasonable grounds to suspect that the respondent’s known lawfully obtained income would be insufficient to allow the respondent to obtain the property’.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Failing to Comply?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Should the target of a UWO fail to comply with an order, or provide inaccurate or misleading information, then they will likely be subject to criminal sanction in the UK and may face a period of imprisonment and a financial penalty.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Within the legislation, it is stated that a UWO could lead to criminal liability for a target if that individual fails, without reasonable excuse, to comply with the requirements imposed by the Court against that individual. There is no definition of what a reasonable excuse would be in the legislation, and is a subjective requirement that would be decided in Court during the course of litigation.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong><img class=\"wp-image-8014 size-medium alignright\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/Screen-Shot-2018-07-31-at-5.43.01-PM-242x300.png\" alt=\"\" width=\"242\" height=\"300\" />A View from the East: Stuck between a Rock and a Hard Place?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">These orders, whilst designed to tackle money laundering on a global scale, and limit the use of the UK jurisdiction for those who seek to gain from their ill-gotten earnings, may cause legal difficulties for individuals based in foreign jurisdictions who are subject to UWOs – such as the UAE and the wider GCC – due to a conflict of laws between this UK legislation and that of other countries. This conflict could lead to an individual’s adherence to UK legislation meaning that the individual would be liable to prosecution in other jurisdictions.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Taking the UAE as a representative example of the Middle East’s approach to confidential or private information, the UAE’s jurisdiction imposes very strict obligations on an individual’s use and disclosure of confidential information. It is a criminal offence, pursuant to the UAE’s Federal Law No. 3 of 1987, as amended by Federal Decree No. 7 of 2016 (UAE Penal Code) to disclose secret information. Secret information is afforded an expansive definition in the UAE Penal Code and it is commonly viewed any information that is confidential, i.e. not in the public domain, and that an individual possesses due to their employment or individual nature.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Furthermore, due to the extraterritorial nature of the UAE Penal Code, should an individual commit a crime that is wholly or partly committed within the UAE, then that individual would be bound by the provisions of the Penal Code, and would be bound by provisions such as the disclosure of secret information. Specifically, should an individual be requested to provide secret information, such as the source of funds from a business entity, to the UK authorities, and that information relates to a UAE business or UAE based individual, then if the material or information is disclosed following a UWO in the UK, then in the UAE the individual may be subject to criminal prosecution for disclosing that exact information.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">There is no exception afforded under UAE domestic legislation that would permit an individual to disclose confidential information to a foreign investigative authority (such as the UK’s Serious Fraud Office, Financial Conduct Authority, or National Security Agency). Should that individual disclose such information to the UK’s, or any other foreign State’s, investigative authority, then that individual may be liable to prosecution in the UAE in the same manner as though the disclosure had been made to a private individual or entity.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Prosecution for disclosing confidential information is a serious offence in the UAE, and one that may carry a mandatory minimum period of imprisonment. Accordingly, the stakes are very high when one is subject to an international request for judicial assistance, in any form, and it is for that reason and in order to assist with international criminal investigations that the UAE has entered into number multilateral and bilateral treaties aimed at assisting mutual judicial assistance requests. As with most international requests from law enforcement agencies, such requests should follow the usual diplomatic channels through the deployment of letters rogatory.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The difficulties for UAE individuals would not stop simply at the threat of criminal sanction, but also according to the UAE’s Labour Law, should an individual disclose the secrets of their employer, then the worker may be dismissed without notice and forfeit their entire severance pay.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Accordingly, the receipt of a UWO in the UK demanding that an individual provide information to the UAE authorities may conflict with the statutory protection relating to confidential information (or other laws) in a foreign jurisdiction, such as the UAE. This would lead to the precarious situation where an individual may face prosecution in the UK if he doesn’t comply with the UWO, but criminal prosecution in the UAE if he does comply.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Conclusion</strong></p>\r\nThe above example and review provides a very high-level overview of the competing laws that the UK’s UWOs may catch. Whilst the UK legislation will no doubt serve as an effective deterrent and useful tool in minimising global money laundering, and limiting the attraction of the UK for criminals, it may have unintended consequences for foreign nationals holding legitimate assets in the UK. Prior to making any response to a request for assistance, it is imperative that the recipient apprise themselves of all legal considerations to ensure that they are not jumping out of the frying pan, but straight into the fire.'),
(261062, 25321, 'MetaValueOld', '<img class=\"alignleft size-full wp-image-8002\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/17-1.png\" alt=\"\" width=\"3567\" height=\"715\" />\r\n\r\n</br>The UK legislature has recently introduced domestic legislation aimed at money launderers, potentially resulting in unintended consequences for foreign nationals who have legitimate assets in the UK. These orders demand the intended target provide information about the origin of their wealth, and refusal to disclose that information may render the target subject to criminal prosecution in the UK. However, if the foreign national does comply with the Unexplained Wealth Order (UWO), then that individual may be subject to criminal prosecution in another State… a real Catch 22.\r\n<p dir=\"LTR\" align=\"LEFT\">Controversially, there is no need for a foreign national to be accused of money laundering, or any criminality whatsoever, before they could be made subject to a UWO, which would lead to the freezing of their assets, or, worse, criminal prosecution.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The following article introduces UWOs to our clients and examines how one must be careful in weighing up their rights and obligations in respect of the request of a foreign State’s investigative authorities as it may impact their rights in the UAE, and around the GCC.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What is a UWO?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">On 31st January 2018, the UK introduced their latest attempt at stemming money laundering in the UK: Unexplained Wealth Orders. UWOs are civil investigative powers that are aimed at tackling those who use the UK as a destination for money laundering, or as a destination for those who wish to spend their ill-gotten gains.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">UWOs have been introduced in the UK at a time when London, and the UK, is facing scrutiny as a perceived hotbed of money laundering and revelry. A main proponent of UWOs has been Transparency International UK’s corruption taskforce, who, amongst others, have repeatedly called for greater investigative action to be taken in the UK against individuals and entities thought to have been complicit in corruption, and have led the drive to bring UWOs into action in UK law.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">UWOs are given legal effect pursuant to the UK Proceeds of Crime Act 2002 Article 362A, as introduced by the Criminal Finances Act 2017, and is defined in the legislation as:</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><em>‘An unexplained wealth order is an order requiring the respondent [i.e. the target of the order] to provide a statement—</em></p>\r\n\r\n<ul>\r\n 	<li><em>setting out the nature and extent of the respondent’s interest in the property in respect of which the order is made,</em></li>\r\n 	<li><em>explaining how the respondent obtained the property (including, in particular, how any costs incurred in obtaining it were met),</em></li>\r\n 	<li><em>where the property is held by the trustees of a settlement, setting out such details of the settlement as may be specified in the order, and</em></li>\r\n 	<li><em>setting out such other information in connection with the property as may be so specified.’</em></li>\r\n</ul>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">The clear advantage that UWOs provide for UK investigative authorities is that it is no longer necessary for the UK authorities to demonstrate that an individual has been subject to a conviction for a criminal offence (either in the UK or abroad) in order to obtain information and take measures against a specific property.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Two months after the introduction of the legislation, in March 2018, it would appear that the first orders are now being made. We have seen the first use of these orders, not on a UK national, but on an Asian politician who owns two properties, worth USD $30 million, in the UK. The specific identity of this individual has not been disclosed as matters are ongoing, and no further details are available publically.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">This means that if an individual owns assets in the UK and they are made subject to a UWO, they will be forced to declare how they obtained this asset, and if they fail to do so they would be subject to criminal prosecution by the UK authorities. This may lead to foreign individuals being stuck between a rock and a hard place, with nowhere to turn and no route of escape.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Why is it Relevant To You?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">As will be apparent from the first orders made against the Asian politician, whilst UWOs do apply to individuals who are reasonably suspected of being involved in crime, the UWOs will also target politically exposed individuals who have not been subject to criminal conviction, or investigation, either in the UK or internationally.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The definition of a PEP, or Politically Exposed Person, varies from State to State, but for the purposes of the UK legislation, the legislators have defined PEPs as the following:</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">‘(a) an individual who is, or has been, entrusted with prominent public functions by an international body or by a State other than the UK or other [European Economic Area] State;</p>\r\n<p dir=\"LTR\" align=\"LEFT\">(b) a family member of a person within paragraph (a); or</p>\r\n<p dir=\"LTR\" align=\"LEFT\">(c) known to be a close associate of a person within […] paragraph [a].’</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">Evidently from this definition, paying particularly close attention to (c) namely ‘a close associate’ of an individual with prominent public functions, there is a very expansive definition of PEP, and this will likely include many unsuspecting individuals. The effect of this definition is that if you are an individual who has prominent public functions, or you are a close associate of another who has been entrusted with public functions, then you may now be targeted by the UK authorities with a UWO. Alarmingly, there is no need for you to have committed a crime, nor to have been suspected of being involved in a crime, for these orders to apply to you.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Specifically, when could a UWO apply?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">A UK high court judge can give notice of a UWO if the judge is satisfied that it is likely that a foreign PEP (as defined above) is the owner of suspicious wealth in the UK beyond their means, and if all of the following provisions are met:</p>\r\n\r\n<ol>\r\n 	<li dir=\"LTR\">The respondent’s known income is insufficient to obtain the asset; and</li>\r\n 	<li dir=\"LTR\">The value of the asset is greater than £50,000 (approx. AED 260,000).</li>\r\n</ol>\r\n<p dir=\"LTR\" align=\"LEFT\">This legislation does not only target Foreign PEPs, but also where there are reasonable grounds to suspect any individual has been involved in serious crime.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Applications for UWOs may be made without notice. This means that there is no requirement on the UK investigative authority to notify the target of a UWO that they, or their assets, have been made subject of a UWO.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What assets would this apply to?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">A UWO can be made against assets whose value is greater than £50,000. There is no need for the PEP to be the sole owner of the property whose value is over £50,000, nor is it of relevance if the property was purchased prior to the introduction of the UK legislation.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What is the effect?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Following the making of an order by the High Court, the Court may order an individual’s property to be frozen, which would preclude the subject of the order from dealing with the property. As these freezing orders may be made without notice, this means that an individual’s assets may be frozen prior to their knowledge of any order being made against them.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The UWO will mandate the individual to explain, at a minimum:</p>\r\n\r\n<ol>\r\n 	<li dir=\"LTR\">The nature and extent of their interest in a particular property; and</li>\r\n 	<li dir=\"LTR\">Explain how the property was obtained.</li>\r\n</ol>\r\n<p dir=\"LTR\" align=\"LEFT\">An explanation will be requested by the UK authorities where ‘there are reasonable grounds to suspect that the respondent’s known lawfully obtained income would be insufficient to allow the respondent to obtain the property’.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Failing to Comply?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Should the target of a UWO fail to comply with an order, or provide inaccurate or misleading information, then they will likely be subject to criminal sanction in the UK and may face a period of imprisonment and a financial penalty.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Within the legislation, it is stated that a UWO could lead to criminal liability for a target if that individual fails, without reasonable excuse, to comply with the requirements imposed by the Court against that individual. There is no definition of what a reasonable excuse would be in the legislation, and is a subjective requirement that would be decided in Court during the course of litigation.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong><img class=\"wp-image-8014 size-medium alignright\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/Screen-Shot-2018-07-31-at-5.43.01-PM-242x300.png\" alt=\"\" width=\"242\" height=\"300\" />A View from the East: Stuck between a Rock and a Hard Place?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">These orders, whilst designed to tackle money laundering on a global scale, and limit the use of the UK jurisdiction for those who seek to gain from their ill-gotten earnings, may cause legal difficulties for individuals based in foreign jurisdictions who are subject to UWOs – such as the UAE and the wider GCC – due to a conflict of laws between this UK legislation and that of other countries. This conflict could lead to an individual’s adherence to UK legislation meaning that the individual would be liable to prosecution in other jurisdictions.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Taking the UAE as a representative example of the Middle East’s approach to confidential or private information, the UAE’s jurisdiction imposes very strict obligations on an individual’s use and disclosure of confidential information. It is a criminal offence, pursuant to the UAE’s Federal Law No. 3 of 1987, as amended by Federal Decree No. 7 of 2016 (UAE Penal Code) to disclose secret information. Secret information is afforded an expansive definition in the UAE Penal Code and it is commonly viewed any information that is confidential, i.e. not in the public domain, and that an individual possesses due to their employment or individual nature.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Furthermore, due to the extraterritorial nature of the UAE Penal Code, should an individual commit a crime that is wholly or partly committed within the UAE, then that individual would be bound by the provisions of the Penal Code, and would be bound by provisions such as the disclosure of secret information. Specifically, should an individual be requested to provide secret information, such as the source of funds from a business entity, to the UK authorities, and that information relates to a UAE business or UAE based individual, then if the material or information is disclosed following a UWO in the UK, then in the UAE the individual may be subject to criminal prosecution for disclosing that exact information.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">There is no exception afforded under UAE domestic legislation that would permit an individual to disclose confidential information to a foreign investigative authority (such as the UK’s Serious Fraud Office, Financial Conduct Authority, or National Security Agency). Should that individual disclose such information to the UK’s, or any other foreign State’s, investigative authority, then that individual may be liable to prosecution in the UAE in the same manner as though the disclosure had been made to a private individual or entity.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Prosecution for disclosing confidential information is a serious offence in the UAE, and one that may carry a mandatory minimum period of imprisonment. Accordingly, the stakes are very high when one is subject to an international request for judicial assistance, in any form, and it is for that reason and in order to assist with international criminal investigations that the UAE has entered into number multilateral and bilateral treaties aimed at assisting mutual judicial assistance requests. As with most international requests from law enforcement agencies, such requests should follow the usual diplomatic channels through the deployment of letters rogatory.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The difficulties for UAE individuals would not stop simply at the threat of criminal sanction, but also according to the UAE’s Labour Law, should an individual disclose the secrets of their employer, then the worker may be dismissed without notice and forfeit their entire severance pay.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Accordingly, the receipt of a UWO in the UK demanding that an individual provide information to the UAE authorities may conflict with the statutory protection relating to confidential information (or other laws) in a foreign jurisdiction, such as the UAE. This would lead to the precarious situation where an individual may face prosecution in the UK if he doesn’t comply with the UWO, but criminal prosecution in the UAE if he does comply.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Conclusion</strong></p>\r\nThe above example and review provides a very high-level overview of the competing laws that the UK’s UWOs may catch. Whilst the UK legislation will no doubt serve as an effective deterrent and useful tool in minimising global money laundering, and limiting the attraction of the UK for criminals, it may have unintended consequences for foreign nationals holding legitimate assets in the UK. Prior to making any response to a request for assistance, it is imperative that the recipient apprise themselves of all legal considerations to ensure that they are not jumping out of the frying pan, but straight into the fire.'),
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INSERT INTO `tm_wsal_metadata` (`id`, `occurrence_id`, `name`, `value`) VALUES
(261065, 25321, 'ReportText', '<img class=\"alignleft size-full wp-image-8002\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/17-1.png\" alt=\"\" width=\"3567\" height=\"715\" />\r\n\r\n</br>The UK legislature has recently introduced domestic legislation aimed at money launderers, potentially resulting in unintended consequences for foreign nationals who have legitimate assets in the UK. These orders demand the intended target provide information about the origin of their wealth, and refusal to disclose that information may render the target subject to criminal prosecution in the UK. However, if the foreign national does comply with the Unexplained Wealth Order (UWO), then that individual may be subject to criminal prosecution in another State… a real Catch 22.\r\n<p dir=\"LTR\" align=\"LEFT\">Controversially, there is no need for a foreign national to be accused of money laundering, or any criminality whatsoever, before they could be made subject to a UWO, which would lead to the freezing of their assets, or, worse, criminal prosecution.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The following article introduces UWOs to our clients and examines how one must be careful in weighing up their rights and obligations in respect of the request of a foreign State’s investigative authorities as it may impact their rights in the UAE, and around the GCC.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What is a UWO?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">On 31st January 2018, the UK introduced their latest attempt at stemming money laundering in the UK: Unexplained Wealth Orders. UWOs are civil investigative powers that are aimed at tackling those who use the UK as a destination for money laundering, or as a destination for those who wish to spend their ill-gotten gains.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">UWOs have been introduced in the UK at a time when London, and the UK, is facing scrutiny as a perceived hotbed of money laundering and revelry. A main proponent of UWOs has been Transparency International UK’s corruption taskforce, who, amongst others, have repeatedly called for greater investigative action to be taken in the UK against individuals and entities thought to have been complicit in corruption, and have led the drive to bring UWOs into action in UK law.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">UWOs are given legal effect pursuant to the UK Proceeds of Crime Act 2002 Article 362A, as introduced by the Criminal Finances Act 2017, and is defined in the legislation as:</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><em>‘An unexplained wealth order is an order requiring the respondent [i.e. the target of the order] to provide a statement—</em></p>\r\n\r\n<ul>\r\n 	<li><em>setting out the nature and extent of the respondent’s interest in the property in respect of which the order is made,</em></li>\r\n 	<li><em>explaining how the respondent obtained the property (including, in particular, how any costs incurred in obtaining it were met),</em></li>\r\n 	<li><em>where the property is held by the trustees of a settlement, setting out such details of the settlement as may be specified in the order, and</em></li>\r\n 	<li><em>setting out such other information in connection with the property as may be so specified.’</em></li>\r\n</ul>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">The clear advantage that UWOs provide for UK investigative authorities is that it is no longer necessary for the UK authorities to demonstrate that an individual has been subject to a conviction for a criminal offence (either in the UK or abroad) in order to obtain information and take measures against a specific property.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Two months after the introduction of the legislation, in March 2018, it would appear that the first orders are now being made. We have seen the first use of these orders, not on a UK national, but on an Asian politician who owns two properties, worth USD $30 million, in the UK. The specific identity of this individual has not been disclosed as matters are ongoing, and no further details are available publically.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">This means that if an individual owns assets in the UK and they are made subject to a UWO, they will be forced to declare how they obtained this asset, and if they fail to do so they would be subject to criminal prosecution by the UK authorities. This may lead to foreign individuals being stuck between a rock and a hard place, with nowhere to turn and no route of escape.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Why is it Relevant To You?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">As will be apparent from the first orders made against the Asian politician, whilst UWOs do apply to individuals who are reasonably suspected of being involved in crime, the UWOs will also target politically exposed individuals who have not been subject to criminal conviction, or investigation, either in the UK or internationally.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The definition of a PEP, or Politically Exposed Person, varies from State to State, but for the purposes of the UK legislation, the legislators have defined PEPs as the following:</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">‘(a) an individual who is, or has been, entrusted with prominent public functions by an international body or by a State other than the UK or other [European Economic Area] State;</p>\r\n<p dir=\"LTR\" align=\"LEFT\">(b) a family member of a person within paragraph (a); or</p>\r\n<p dir=\"LTR\" align=\"LEFT\">(c) known to be a close associate of a person within […] paragraph [a].’</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">Evidently from this definition, paying particularly close attention to (c) namely ‘a close associate’ of an individual with prominent public functions, there is a very expansive definition of PEP, and this will likely include many unsuspecting individuals. The effect of this definition is that if you are an individual who has prominent public functions, or you are a close associate of another who has been entrusted with public functions, then you may now be targeted by the UK authorities with a UWO. Alarmingly, there is no need for you to have committed a crime, nor to have been suspected of being involved in a crime, for these orders to apply to you.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Specifically, when could a UWO apply?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">A UK high court judge can give notice of a UWO if the judge is satisfied that it is likely that a foreign PEP (as defined above) is the owner of suspicious wealth in the UK beyond their means, and if all of the following provisions are met:</p>\r\n\r\n<ol>\r\n 	<li dir=\"LTR\">The respondent’s known income is insufficient to obtain the asset; and</li>\r\n 	<li dir=\"LTR\">The value of the asset is greater than £50,000 (approx. AED 260,000).</li>\r\n</ol>\r\n<p dir=\"LTR\" align=\"LEFT\">This legislation does not only target Foreign PEPs, but also where there are reasonable grounds to suspect any individual has been involved in serious crime.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Applications for UWOs may be made without notice. This means that there is no requirement on the UK investigative authority to notify the target of a UWO that they, or their assets, have been made subject of a UWO.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What assets would this apply to?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">A UWO can be made against assets whose value is greater than £50,000. There is no need for the PEP to be the sole owner of the property whose value is over £50,000, nor is it of relevance if the property was purchased prior to the introduction of the UK legislation.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What is the effect?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Following the making of an order by the High Court, the Court may order an individual’s property to be frozen, which would preclude the subject of the order from dealing with the property. As these freezing orders may be made without notice, this means that an individual’s assets may be frozen prior to their knowledge of any order being made against them.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The UWO will mandate the individual to explain, at a minimum:</p>\r\n\r\n<ol>\r\n 	<li dir=\"LTR\">The nature and extent of their interest in a particular property; and</li>\r\n 	<li dir=\"LTR\">Explain how the property was obtained.</li>\r\n</ol>\r\n<p dir=\"LTR\" align=\"LEFT\">An explanation will be requested by the UK authorities where ‘there are reasonable grounds to suspect that the respondent’s known lawfully obtained income would be insufficient to allow the respondent to obtain the property’.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Failing to Comply?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Should the target of a UWO fail to comply with an order, or provide inaccurate or misleading information, then they will likely be subject to criminal sanction in the UK and may face a period of imprisonment and a financial penalty.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Within the legislation, it is stated that a UWO could lead to criminal liability for a target if that individual fails, without reasonable excuse, to comply with the requirements imposed by the Court against that individual. There is no definition of what a reasonable excuse would be in the legislation, and is a subjective requirement that would be decided in Court during the course of litigation.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong><img class=\"wp-image-8014 size-medium alignright\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/Screen-Shot-2018-07-31-at-5.43.01-PM-242x300.png\" alt=\"\" width=\"242\" height=\"300\" />A View from the East: Stuck between a Rock and a Hard Place?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">These orders, whilst designed to tackle money laundering on a global scale, and limit the use of the UK jurisdiction for those who seek to gain from their ill-gotten earnings, may cause legal difficulties for individuals based in foreign jurisdictions who are subject to UWOs – such as the UAE and the wider GCC – due to a conflict of laws between this UK legislation and that of other countries. This conflict could lead to an individual’s adherence to UK legislation meaning that the individual would be liable to prosecution in other jurisdictions.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Taking the UAE as a representative example of the Middle East’s approach to confidential or private information, the UAE’s jurisdiction imposes very strict obligations on an individual’s use and disclosure of confidential information. It is a criminal offence, pursuant to the UAE’s Federal Law No. 3 of 1987, as amended by Federal Decree No. 7 of 2016 (UAE Penal Code) to disclose secret information. Secret information is afforded an expansive definition in the UAE Penal Code and it is commonly viewed any information that is confidential, i.e. not in the public domain, and that an individual possesses due to their employment or individual nature.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Furthermore, due to the extraterritorial nature of the UAE Penal Code, should an individual commit a crime that is wholly or partly committed within the UAE, then that individual would be bound by the provisions of the Penal Code, and would be bound by provisions such as the disclosure of secret information. Specifically, should an individual be requested to provide secret information, such as the source of funds from a business entity, to the UK authorities, and that information relates to a UAE business or UAE based individual, then if the material or information is disclosed following a UWO in the UK, then in the UAE the individual may be subject to criminal prosecution for disclosing that exact information.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">There is no exception afforded under UAE domestic legislation that would permit an individual to disclose confidential information to a foreign investigative authority (such as the UK’s Serious Fraud Office, Financial Conduct Authority, or National Security Agency). Should that individual disclose such information to the UK’s, or any other foreign State’s, investigative authority, then that individual may be liable to prosecution in the UAE in the same manner as though the disclosure had been made to a private individual or entity.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Prosecution for disclosing confidential information is a serious offence in the UAE, and one that may carry a mandatory minimum period of imprisonment. Accordingly, the stakes are very high when one is subject to an international request for judicial assistance, in any form, and it is for that reason and in order to assist with international criminal investigations that the UAE has entered into number multilateral and bilateral treaties aimed at assisting mutual judicial assistance requests. As with most international requests from law enforcement agencies, such requests should follow the usual diplomatic channels through the deployment of letters rogatory.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The difficulties for UAE individuals would not stop simply at the threat of criminal sanction, but also according to the UAE’s Labour Law, should an individual disclose the secrets of their employer, then the worker may be dismissed without notice and forfeit their entire severance pay.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Accordingly, the receipt of a UWO in the UK demanding that an individual provide information to the UAE authorities may conflict with the statutory protection relating to confidential information (or other laws) in a foreign jurisdiction, such as the UAE. This would lead to the precarious situation where an individual may face prosecution in the UK if he doesn’t comply with the UWO, but criminal prosecution in the UAE if he does comply.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Conclusion</strong></p>\r\nThe above example and review provides a very high-level overview of the competing laws that the UK’s UWOs may catch. Whilst the UK legislation will no doubt serve as an effective deterrent and useful tool in minimising global money laundering, and limiting the attraction of the UK for criminals, it may have unintended consequences for foreign nationals holding legitimate assets in the UK. Prior to making any response to a request for assistance, it is imperative that the recipient apprise themselves of all legal considerations to ensure that they are not jumping out of the frying pan, but straight into the fire.|<img class=\"alignleft size-full wp-image-8002\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/17-1.png\" alt=\"\" width=\"3567\" height=\"715\" />\r\n\r\n&nbsp;\r\n\r\nThe UK legislature has recently introduced domestic legislation aimed at money launderers, potentially resulting in unintended consequences for foreign nationals who have legitimate assets in the UK. These orders demand the intended target provide information about the origin of their wealth, and refusal to disclose that information may render the target subject to criminal prosecution in the UK. However, if the foreign national does comply with the Unexplained Wealth Order (UWO), then that individual may be subject to criminal prosecution in another State… a real Catch 22.\r\n\r\n<p dir=\"LTR\" align=\"LEFT\">Controversially, there is no need for a foreign national to be accused of money laundering, or any criminality whatsoever, before they could be made subject to a UWO, which would lead to the freezing of their assets, or, worse, criminal prosecution.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The following article introduces UWOs to our clients and examines how one must be careful in weighing up their rights and obligations in respect of the request of a foreign State’s investigative authorities as it may impact their rights in the UAE, and around the GCC.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What is a UWO?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">On 31st January 2018, the UK introduced their latest attempt at stemming money laundering in the UK: Unexplained Wealth Orders. UWOs are civil investigative powers that are aimed at tackling those who use the UK as a destination for money laundering, or as a destination for those who wish to spend their ill-gotten gains.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">UWOs have been introduced in the UK at a time when London, and the UK, is facing scrutiny as a perceived hotbed of money laundering and revelry. A main proponent of UWOs has been Transparency International UK’s corruption taskforce, who, amongst others, have repeatedly called for greater investigative action to be taken in the UK against individuals and entities thought to have been complicit in corruption, and have led the drive to bring UWOs into action in UK law.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">UWOs are given legal effect pursuant to the UK Proceeds of Crime Act 2002 Article 362A, as introduced by the Criminal Finances Act 2017, and is defined in the legislation as:</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><em>‘An unexplained wealth order is an order requiring the respondent [i.e. the target of the order] to provide a statement—</em></p>\r\n\r\n<ul>\r\n 	<li><em>setting out the nature and extent of the respondent’s interest in the property in respect of which the order is made,</em></li>\r\n 	<li><em>explaining how the respondent obtained the property (including, in particular, how any costs incurred in obtaining it were met),</em></li>\r\n 	<li><em>where the property is held by the trustees of a settlement, setting out such details of the settlement as may be specified in the order, and</em></li>\r\n 	<li><em>setting out such other information in connection with the property as may be so specified.’</em></li>\r\n</ul>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">The clear advantage that UWOs provide for UK investigative authorities is that it is no longer necessary for the UK authorities to demonstrate that an individual has been subject to a conviction for a criminal offence (either in the UK or abroad) in order to obtain information and take measures against a specific property.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Two months after the introduction of the legislation, in March 2018, it would appear that the first orders are now being made. We have seen the first use of these orders, not on a UK national, but on an Asian politician who owns two properties, worth USD $30 million, in the UK. The specific identity of this individual has not been disclosed as matters are ongoing, and no further details are available publically.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">This means that if an individual owns assets in the UK and they are made subject to a UWO, they will be forced to declare how they obtained this asset, and if they fail to do so they would be subject to criminal prosecution by the UK authorities. This may lead to foreign individuals being stuck between a rock and a hard place, with nowhere to turn and no route of escape.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Why is it Relevant To You?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">As will be apparent from the first orders made against the Asian politician, whilst UWOs do apply to individuals who are reasonably suspected of being involved in crime, the UWOs will also target politically exposed individuals who have not been subject to criminal conviction, or investigation, either in the UK or internationally.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The definition of a PEP, or Politically Exposed Person, varies from State to State, but for the purposes of the UK legislation, the legislators have defined PEPs as the following:</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">‘(a) an individual who is, or has been, entrusted with prominent public functions by an international body or by a State other than the UK or other [European Economic Area] State;</p>\r\n<p dir=\"LTR\" align=\"LEFT\">(b) a family member of a person within paragraph (a); or</p>\r\n<p dir=\"LTR\" align=\"LEFT\">(c) known to be a close associate of a person within […] paragraph [a].’</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\">Evidently from this definition, paying particularly close attention to (c) namely ‘a close associate’ of an individual with prominent public functions, there is a very expansive definition of PEP, and this will likely include many unsuspecting individuals. The effect of this definition is that if you are an individual who has prominent public functions, or you are a close associate of another who has been entrusted with public functions, then you may now be targeted by the UK authorities with a UWO. Alarmingly, there is no need for you to have committed a crime, nor to have been suspected of being involved in a crime, for these orders to apply to you.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Specifically, when could a UWO apply?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">A UK high court judge can give notice of a UWO if the judge is satisfied that it is likely that a foreign PEP (as defined above) is the owner of suspicious wealth in the UK beyond their means, and if all of the following provisions are met:</p>\r\n\r\n<ol>\r\n 	<li dir=\"LTR\">The respondent’s known income is insufficient to obtain the asset; and</li>\r\n 	<li dir=\"LTR\">The value of the asset is greater than £50,000 (approx. AED 260,000).</li>\r\n</ol>\r\n<p dir=\"LTR\" align=\"LEFT\">This legislation does not only target Foreign PEPs, but also where there are reasonable grounds to suspect any individual has been involved in serious crime.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Applications for UWOs may be made without notice. This means that there is no requirement on the UK investigative authority to notify the target of a UWO that they, or their assets, have been made subject of a UWO.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What assets would this apply to?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">A UWO can be made against assets whose value is greater than £50,000. There is no need for the PEP to be the sole owner of the property whose value is over £50,000, nor is it of relevance if the property was purchased prior to the introduction of the UK legislation.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>What is the effect?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Following the making of an order by the High Court, the Court may order an individual’s property to be frozen, which would preclude the subject of the order from dealing with the property. As these freezing orders may be made without notice, this means that an individual’s assets may be frozen prior to their knowledge of any order being made against them.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The UWO will mandate the individual to explain, at a minimum:</p>\r\n\r\n<ol>\r\n 	<li dir=\"LTR\">The nature and extent of their interest in a particular property; and</li>\r\n 	<li dir=\"LTR\">Explain how the property was obtained.</li>\r\n</ol>\r\n<p dir=\"LTR\" align=\"LEFT\">An explanation will be requested by the UK authorities where ‘there are reasonable grounds to suspect that the respondent’s known lawfully obtained income would be insufficient to allow the respondent to obtain the property’.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Failing to Comply?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">Should the target of a UWO fail to comply with an order, or provide inaccurate or misleading information, then they will likely be subject to criminal sanction in the UK and may face a period of imprisonment and a financial penalty.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Within the legislation, it is stated that a UWO could lead to criminal liability for a target if that individual fails, without reasonable excuse, to comply with the requirements imposed by the Court against that individual. There is no definition of what a reasonable excuse would be in the legislation, and is a subjective requirement that would be decided in Court during the course of litigation.</p>\r\n<p dir=\"LTR\" align=\"LEFT\"><strong><img class=\"wp-image-8014 size-medium alignright\" src=\"http://www.tamimi.com/wp-content/uploads/2018/07/Screen-Shot-2018-07-31-at-5.43.01-PM-242x300.png\" alt=\"\" width=\"242\" height=\"300\" />A View from the East: Stuck between a Rock and a Hard Place?</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">These orders, whilst designed to tackle money laundering on a global scale, and limit the use of the UK jurisdiction for those who seek to gain from their ill-gotten earnings, may cause legal difficulties for individuals based in foreign jurisdictions who are subject to UWOs – such as the UAE and the wider GCC – due to a conflict of laws between this UK legislation and that of other countries. This conflict could lead to an individual’s adherence to UK legislation meaning that the individual would be liable to prosecution in other jurisdictions.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Taking the UAE as a representative example of the Middle East’s approach to confidential or private information, the UAE’s jurisdiction imposes very strict obligations on an individual’s use and disclosure of confidential information. It is a criminal offence, pursuant to the UAE’s Federal Law No. 3 of 1987, as amended by Federal Decree No. 7 of 2016 (UAE Penal Code) to disclose secret information. Secret information is afforded an expansive definition in the UAE Penal Code and it is commonly viewed any information that is confidential, i.e. not in the public domain, and that an individual possesses due to their employment or individual nature.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Furthermore, due to the extraterritorial nature of the UAE Penal Code, should an individual commit a crime that is wholly or partly committed within the UAE, then that individual would be bound by the provisions of the Penal Code, and would be bound by provisions such as the disclosure of secret information. Specifically, should an individual be requested to provide secret information, such as the source of funds from a business entity, to the UK authorities, and that information relates to a UAE business or UAE based individual, then if the material or information is disclosed following a UWO in the UK, then in the UAE the individual may be subject to criminal prosecution for disclosing that exact information.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">There is no exception afforded under UAE domestic legislation that would permit an individual to disclose confidential information to a foreign investigative authority (such as the UK’s Serious Fraud Office, Financial Conduct Authority, or National Security Agency). Should that individual disclose such information to the UK’s, or any other foreign State’s, investigative authority, then that individual may be liable to prosecution in the UAE in the same manner as though the disclosure had been made to a private individual or entity.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Prosecution for disclosing confidential information is a serious offence in the UAE, and one that may carry a mandatory minimum period of imprisonment. Accordingly, the stakes are very high when one is subject to an international request for judicial assistance, in any form, and it is for that reason and in order to assist with international criminal investigations that the UAE has entered into number multilateral and bilateral treaties aimed at assisting mutual judicial assistance requests. As with most international requests from law enforcement agencies, such requests should follow the usual diplomatic channels through the deployment of letters rogatory.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The difficulties for UAE individuals would not stop simply at the threat of criminal sanction, but also according to the UAE’s Labour Law, should an individual disclose the secrets of their employer, then the worker may be dismissed without notice and forfeit their entire severance pay.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Accordingly, the receipt of a UWO in the UK demanding that an individual provide information to the UAE authorities may conflict with the statutory protection relating to confidential information (or other laws) in a foreign jurisdiction, such as the UAE. This would lead to the precarious situation where an individual may face prosecution in the UK if he doesn’t comply with the UWO, but criminal prosecution in the UAE if he does comply.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Conclusion</strong></p>\r\nThe above example and review provides a very high-level overview of the competing laws that the UK’s UWOs may catch. Whilst the UK legislation will no doubt serve as an effective deterrent and useful tool in minimising global money laundering, and limiting the attraction of the UK for criminals, it may have unintended consequences for foreign nationals holding legitimate assets in the UK. Prior to making any response to a request for assistance, it is imperative that the recipient apprise themselves of all legal considerations to ensure that they are not jumping out of the frying pan, but straight into the fire.'),
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(261211, 25333, 'MetaValueNew', '<p dir=\"LTR\" align=\"LEFT\">It is rare for arbitrators to be sued in the UAE although the prospect of such steps being taken has garnered much press interest in recent times. The new 2018 arbitration law (UAE Federal Arbitration Law No. 6 of 2018) does not address the issue, and the old law (Articles 208 to 218 of UAE Civil Procedure Law No. 11 of 1992) merely stated that an arbitrator could be liable for damages if the arbitrator resigns without a good reason. However, a recent Dubai Court of Cassation judgment (No. 484 of 2017) has considered the issue and provided helpful guidance. This article considers this important judgment and its implications.</p>\r\n&nbsp;\r\n<p dir=\"LTR\" align=\"LEFT\"><strong>Background</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">A developer, Al Sayyah &amp; Sons Investments LLC (the \"Developer\"), sold various units off-plan in a tower it was developing in Dubai Marina. Various purchasers assigned their rights under the sale and purchase agreements they had with the Developer to a real estate finance company, Amlak.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Amlak initiated DIAC arbitration proceedings against the Developer, alleging that the units (now built) were not in conformity with the agreements.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">In July 2012 DIAC appointed the sole arbitrator (\"Arbitrator No.1\"). He issued a partial award in November 2013 determining jurisdictional issues. Arbitrator No.1 resigned in December 2013 due to issues regarding impartiality. Arbitrator No.2 was subsequently appointed as the sole arbitrator by DIAC. Arbitrator No 2 issued a final award against the Developer. The award ordered that the Developer pay Amlak AED 46.5m plus interest, as well as AED 466,788 in arbitration costs. Arbitrator No 2 issued a supplemental award to correct accounting calculation errors in the final award which reduced the amount payable to AED 42.7m.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The final award was ratified by the Dubai Courts and an amount of AED 42.7m was paid in full by the Developer to Amlak.</p>\r\n&nbsp;<p dir=\"LTR\" align=\"LEFT\"><strong>The Claim Before the Courts</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Developer then filed a claim before the Dubai Court of First Instance alleging that the two arbitrators had committed material errors in their respective awards. It was claimed that:</p>\r\n\r\n<ol>\r\n 	<li dir=\"LTR\">The two arbitrators lacked capacity to decide the dispute.</li>\r\n 	<li dir=\"LTR\">Arbitrator No.1 erred in his award on jurisdiction by holding that Al Sayyah &amp; Sons Investments LLC and Al Sayyah Investments were the same legal entity. Arbitrator No.2 made the same error by relying on and adopting the terms of the partial award in issuing the final award.</li>\r\n 	<li dir=\"LTR\">The Developer was not a party to the agreements containing the arbitration clause.</li>\r\n 	<li dir=\"LTR\">Arbitrator No.2 had denied the Developer’s right to submit its defence as Amlak should have been ordered to submit the original agreements.</li>\r\n 	<li dir=\"LTR\">Arbitrator No.2 had altered the terms of the agreement in order to render the final award and had failed to address the issue of lack of jurisdiction.</li>\r\n 	<li dir=\"LTR\">Arbitrator No.2 failed to include the names of the unit owners and misrepresented the unit area data as set out in the architect’s report in his supplemental award.</li>\r\n 	<li dir=\"LTR\">Arbitrator No.2 failed to take into consideration the relevant Land Department documents delineating the gross area of the units when making the final award.</li>\r\n</ol>\r\n<p dir=\"LTR\" align=\"LEFT\">For the above reasons the Developer asserted that they were wrongfully ordered to pay Amlak the AED 42m and sought that both arbitrators be held jointly and severally liable to repay this money to the Developer.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Court of First Instance dismissed the Developer’s claim in January 2017. This was upheld by the Dubai Court of Appeal in September 2017. The Developer appealed to the Dubai Court of Cassation.</p>\r\n&nbsp;<p dir=\"LTR\" align=\"LEFT\"><strong>The Dubai Court of Cassation judgment</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">On 21 December 2017 the Court of Cassation dismissed the appeal. The Court of Cassation explained that in order for an arbitrator to be found liable in tort, the following elements had to be proved by the claimant:</p>\r\n\r\n<ol>\r\n 	<li dir=\"LTR\">There had been an act or omission by the arbitrator;</li>\r\n 	<li dir=\"LTR\">Harm was incurred by the claimant; and</li>\r\n 	<li dir=\"LTR\">There was a causal link between the act or omission and the harm caused.</li>\r\n</ol>\r\n<p dir=\"LTR\" align=\"LEFT\"><em>Significantly, the Court then went further and stated that the act or omission would need to be \"a serious mistake tainted by deceit, fraud, collusion with the opponent, or refusal to act without acceptable justification. An ordinary mistake or negligence, whether in judgment or procedure, is not sufficient to hold the arbitrator liable unless it is a serious mistake or fraud\".</em></p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Court held that it is for the trial court to examine the evidence and determine whether an arbitrator is liable. In this case the Court held that the errors which the Developer alleged were errors of judgment for which the two arbitrators could not be sued.</p>\r\n&nbsp;<p dir=\"LTR\" align=\"LEFT\"><strong>A Step in the Right Direction</strong></p>\r\n<p dir=\"LTR\" align=\"LEFT\">The Court found that it was not enough for the claimant to demonstrate that an arbitrator made an error that had caused loss to the claimant. The error has to be a ‘serious mistake’ or one tainted by fraud or deceit or otherwise inexplicable. This suggests a high-threshold and one that should give comfort to arbitrators.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">This standard of civil liability is in tune with the threshold found in other laws. Both the DIFC and the ADGM have arbitration laws stating that an arbitrator will not be liable ‘unless they are shown to have caused damage by conscious and deliberate wrongdoing’ (Article 22 of the DIFC Arbitration Law 2008; Article 23 of the ADGM Arbitration Regulations 2015).</p>\r\n<p dir=\"LTR\" align=\"LEFT\">Many arbitral rules contain terms stating that the parties agree not to sue the arbitrator. This includes the DIAC rules which state, at Article 40, that no member of a tribunal shall be liable in connection with the arbitration. It is not clear why this was not referred to by the Court in its judgment, but its absence leaves open the question of whether an arbitrator’s liability under the law can be further limited by the consent of the parties.</p>\r\n<p dir=\"LTR\" align=\"LEFT\">This Court of Cassation judgment is definitely a positive step forward. It should make arbitrator’s feel more confident that whilst they are not immune from suit, they are protected from spurious claims brought by disgruntled parties.</p>\r\n&nbsp;\r\n\r\n<em>Al Tamimi uniquely possesses the capability to litigate before both of the financial free zone courts and conduct litigation before the UAE Federal Courts and the courts of each individual Emirate. <a href=\"https://www.tamimi.com/practice/arbitration/\">Al Tamimi &amp; Company’s Arbitration team</a> regularly advises on international investment and commercial arbitration. For further information, please contact Dr. Hassan Arab (<a href=\"mailto:h.arab@tamimi.com\">h.arab@tamimi.com</a>) or Dalal Al Houti (<a href=\"mailto:D.Alhouti@tamimi.com\">D.Alhouti@tamimi.com</a>).</em>');
