The UK government has announced new sanctions against Myanmar tycoon U Tay Za and the Htoo Group of Companies, for their close ties to the country’s military junta and for providing arms and financial support to the military.
The move comes after sanctions were imposed on senior Myanmar military officers and businesses associated with them following February’s military coup.
U Tay Za, whose Htoo Group business empire includes banks, airlines, and hotels, is one of the richest people in Myanmar and is believed to have helped supply arms to the former junta led by Than Shwe. He is also linked to human rights violations, illegal logging activities and is reported to have contributed funds to the 2017 Rohingya “clearance operations” in Rakhine, in which thousands of civilians were killed and hundreds of villages burned.
The UK’s Foreign Secretary said: “The military junta has shown no signs of halting its brutal attack on the people of Myanmar. Along with our partners, the UK will continue to restrict the junta’s access to finance, and the supply of arms used to kill innocents, including children, and target those who support the junta’s actions.”
The sanctions measures will freeze all UK assets held by Htoo Group and U Tay Za and ban the business tycoon from entering the UK. They will also block others from providing funds or economic resources to either party.
Since leaving the EU, the UK has shown a willingness to act quickly and autonomously to impose new measures – and its current presidency of the G7 has given it additional leverage.
In June, the UK delivered a UN General Assembly Resolution which urged member states to prevent the flow of arms to Myanmar, and under the UK’s presidency, the G7 continues to call for a return to democracy, an end to the violence, and the immediate adoption of the ASEAN 5-point consensus.
Evolving political situations
Our recent report on global sanctions highlighted Myanmar as a key geopolitical hotspot. While the UK, EU, US, and Canada have imposed asset freezes and travel bans on senior military leaders, Australia and members of ASEAN have not imposed sanctions and have instead called for internal dialogue to resolve the matter.
In volatile and evolving political situations sanctions can be imposed quickly, so it is important that compliance teams keep up-to-date with the latest guidance, and ensure they are screening against up-to-date lists of sanctioned people and entities. For businesses with exposure to Myanmar and neighboring countries, it will be important to keep a close watch on the situation, as further additions to UK, EU, and US sanctions lists are likely.
Compliance teams should also be aware that the military can be well embedded in an economy. There can be a wide variety of industries within a country driving military funding, and these may often be hidden within supply chains. In the EU, businesses in Germany, the Netherlands, and Italy have all been found to be flouting EU sanctions by importing timber from Myanmar.
Making sure that global sanctions screening tools are up-to-date is also crucial to ensure that anti-money laundering and counter-terrorism financing compliance is maintained.