Traditional Compliance Programs Not Sufficient in Case of Brexit, BP Lawyer Says

As the United Kingdom moves closer to its withdrawal date from the European Union in October, traditional “cookie cutter” compliance programs will not be sufficient for companies looking to remain compliant with global sanctions in Brexit’s aftermath, said Tina Carlile, a senior counsel for international trade at BP.

Carlile, speaking during an April 18 webcast hosted by Akin Gump, explained how an array of Brexit-related subjects could affect export controls and sanctions compliance, specifically in oil industries. In a question-and-answer session with Akin Gump lawyer Daniel Lund, Carlile said the three main challenges confronting many businesses are “planning for Brexit when you don't know what you're planning for,” avoiding “fear mongering” and “misinformation,” and “balancing Brexit planning with changes coming from the U.S.” As an example, Carlile pointed to an announcement from the previous day, when the U.S. Treasury’s Office of Foreign Assets Control issued sanctions on April 17 against Banco Central de Venezuela. “Because of the nature of the business, [you] really need to be able to adapt to changes,” she said.

If Britain leaves the EU, the challenges, Carlile said, may come from trying to simultaneously comply with U.K., EU and U.S. sanctions, including any secondary sanctions. “Sometimes this means looking very closely both at what the sanctions say, what they're trying to achieve and then charting a path that complies with all of the above,” she said. “Sometimes that's a little bit easier said than done.” And although she said a potential Brexit has caused global concerns from companies about compliance issues, she said there may be at least one positive. “Ultimately, Brexit has forced companies to take a closer look at their compliance programs and procedures,” Carlile said, “which is never a bad thing.”

Carlile also said the oil and gas industry is “relatively better prepared to respond to Brexit” than other industries, such as the banking sector. “Oil and gas is set up differently ... it’s less involved than some other industries,” Carlile said, adding that the export controls are “relatively straightforward. As long as a company knows which controlled items it’s moving, what licenses are currently in place and has a legal exporting entity already set up in both the U.K. and EU, it’s not that difficult.”