Schedules Schedule 10 – Cryptoassets: Terrorism Part 1 – Amendments to Schedule 1 to the Anti-Terrorism, Crime and Security Act 2001 Part 4BC: Forfeiture of Terrorist Cryptoassets
This Part makes provision about "associated property" which is defined in new paragraph 10Z7CC, the "appropriate court" defined in new paragraph 10Z7CE, and a "deproscription order" defined in new paragraph 10Z7CH. Part 4BC also includes a delegated power which will allow updates to the means by which a cryptoasset service provider will be required to forfeit cryptoassets. This provides that the Secretary of State may, by regulations, amend the provisions to overcome any future technical barriers around the forfeiture of cryptoassets administered by a third party.
	Paragraphs 10Z7C to 10Z7CM provide that a court may order the forfeiture of some, or all, of the cryptoassets detained or frozen by a crypto wallet freezing order, if satisfied on the balance of probability that the cryptoassets are terrorist cryptoassets.
	Paragraph 10Z7CB provides that an order for the forfeiture of cryptoassets held in a crypto wallet and administered by a cryptoasset service provider requires the provider to transfer those assets into a law enforcement crypto wallet nominated by an authorised officer.
	Paragraph 10Z7CD provides that a court may, instead of making a forfeiture order, order that a person who holds associated property or who is an excepted joint owner may retain the property but must pay the law enforcement agency an amount equivalent to the value of the forfeitable property, less the value of the excepted joint owner’s share, and where there is agreement amongst the parties as to the extent of the forfeitable portion of the cryptoassets.
	Paragraph 10Z7CE provides that in circumstances where no agreement can be reached regarding the interests in the associated or joint property holders of the cryptoassets, the case must be transferred to an appropriate court (either the High Court or, in Scotland, the Court of Session). This paragraph also provides that if an order for forfeiture of part of the cryptoasset (including the associated property) is made, and the court considers it is "just and equitable" to do so, it may also order that the excepted joint owner’s interest will be extinguished or severed and that a payment be made to that individual.
	Paragraph 10Z7CF provides that where a court makes a forfeiture order for some, but not all, of the cryptoassets in a crypto wallet, law enforcement officers may apply for an extension of the crypto wallet freezing order pending the appeal outcome.
	Paragraph 10Z7CG provides that any appeal against a forfeiture decision, by law enforcement or a person aggrieved by the order, must be lodged within 30 days except in deproscription cases (see paragraph 10Z7CH). If the forfeiture appeal is upheld, the court may order the release of the whole, or part, of the property. If a forfeiture order is successfully appealed, and the cryptoassets are released, any interest which accrued during the time that the assets were held by the enforcement officer must also be returned to the person from whom they were seized, or the person for whom the crypto wallet was administered for immediately before the freezing order was made.
	Paragraph 10Z7CI provides for an authorised officer to destroy cryptoassets, subject to any forfeiture appeal being exhausted and where it is either not reasonably practicable to arrange for the realisation of the cryptoassets, or where there are reasonable grounds to believe that the realisation of the cryptoassets would be contrary to the public interest (e.g., if they would facilitate criminal conduct by any person).
	Paragraphs 10Z7CK and 10Z7CL provides that any or all detained cryptoassets or, those cryptoassets held in a crypto wallet and subject to a crypto wallet freezing order, may be released to any victim by application if it appears to the court that they were deprived of the cryptoassets to which the application relates; deprived by criminal conduct of the property which the cryptoassets represent; if the cryptoassets were not obtained by or in return for criminal conduct; or the cryptoassets belong to the applicant.
	Paragraph 10Z7CM provides that in respect of cryptoassets either detained or subject to a crypto wallet freezing order, an affected person may apply to the court for compensation in exceptional circumstances.