Terrorism: Finance

Statement

The Financial Services Secretary to the Treasury (Lord Myners)
My honourable friend the Exchequer Secretary to the Treasury (Sarah McCarthy-Fry) has today made the following Written Ministerial Statement.

The Supreme Court has today ruled that it will not grant a stay of its 27 January 2010 judgment on the legality of the Orders in Council that HM Treasury uses to freeze terrorist assets. The effect of this judgment is to quash with immediate effect the Terrorism Order 2006 and all designations made under it. The court has not directly quashed the Terrorism Order 2001 and the Terrorism Order 2009, but the reason for its decision also makes those orders unsustainable.

Over £150,000 belonging to suspected terrorists is currently frozen in the UK under the terrorism orders. The UK takes its obligations under the UN Charter very seriously and the Government believe that allowing this money to be unfrozen and returned to individuals designated under the orders and giving them access to the financial system would not be in the interests of national security. In order to prevent assets frozen under the terrorism orders from being released, the Government will introduce primary legislation tomorrow to restore the validity of the terrorism orders and the designations made under them. The Government hope that this legislation should be passed by early next week. The legislation will include a provision backdated to today’s judgment, providing legal authority to banks and other persons covered by the existing orders so as to allow the existing asset freezes to be maintained without a gap.

The legislation will extend the current terrorism orders only for a temporary period. This will give Parliament time in which to consider more fully how best to legislate to give effect to our UN terrorist asset freezing commitments, while ensuring that national security is protected in the mean time.