Russia sanctions: refreshed guidance on ownership and control
OFSI's updated guidance clarifies aggregation of holdings across designated persons for the purposes of the 50 per cent ownership test, and raises the evidential bar for the alternative control test where influence is exercised through non-equity means such as board appointment rights, financing covenants or shareholder agreements. Legal, property, corporate services and private banking firms should re-test EDD templates and consider whether historic files require refresh in light of the tighter standard.
The aggregation point
Where two or more designated persons hold interests in the same entity, OFSI now expects firms to aggregate those holdings when applying the 50 per cent test. This closes a structuring route that had become widely used through 2024–2025.
The control test
The alternative control test bites where a designated person can secure a particular outcome — appointment of a majority of the board, a veto over strategic decisions, a direction on the disposal of assets — without holding an equity majority. OFSI's examples now cover financing covenants and shareholder-agreement rights.
Firms must be able to evidence the enquiry, not merely the conclusion. A file that records 'no control' without setting out what was reviewed will not defend a licensing decision.
What to do now
Re-test EDD templates against the refreshed guidance. Prioritise files opened between February 2022 and the guidance date where the customer sits in a high-risk sector or jurisdiction.