Following recent developments in the U.S.-Russia relationship, including the meeting earlier this month in Helsinki between Donald Trump and Vladimir Putin, both the U.S. Senate and House of Representatives are considering new legislation to authorize or mandate additional sanctions against Russia. The legislative efforts have bipartisan support, but the prospects for enactment are uncertain, particularly given what is likely to be opposition from the Trump administration. Below, we briefly summarize several of these bills.
DETER (Defending Elections from Threats by Establishing Redlines) Act (S. 2313):The DETER Act would authorize further sanctions against Russia and Russian companies if the Director of National Intelligence determines that Russia interferes with a future U.S. election.
- Among other measures, the sanctions would target the Russian finance, energy, defense and intelligence, metals and mining, and aerospace industries by placing a number of prominent Russian companies on the list of Specially Designated Nationals (“SDNs”) maintained by the U.S. Treasury Department’s Office of Foreign Assets Control (“OFAC”). Designation as an SDN would require U.S. persons to block any property of a designated company and refrain from dealings in which a designated company has an interest. Additionally, U.S. secondary sanctions would authorize similar sanctions against any non-U.S. person that engages in a “significant” transaction with a designated company.
- The bill was introduced in January 2018 by Senators Marco Rubio (R-Fla.) and Chris Van Hollen (D-Md.) and has eleven other co-sponsors in the Senate; the House version of the bill (H.R. 4884) has 24 co-sponsors. More recently, Senate Majority Leader Mitch McConnell (R-Ky.) indicated that he may bring the DETER Act directly to the Senate floor for a vote, bypassing the usual committee review process, though certain senators, including Senators John Cornyn (R-Tex.) and Bob Corker (R-Tenn.), have expressed reservations about the potential effects of the proposed sanctions on U.S. businesses.
Sens. Graham and Menendez’s Proposal: Senators Lindsey Graham (R-S.C.) and Bob Menendez (D-N.J.) announced a proposed sanctions bill targeting the Russian finance and energy industries, cyber-actors and oligarchs. In contrast to the DETER Act, which would be triggered by election meddling, this bill would call for immediate mandatory sanctions against Russia. Legislative text is not yet available, but among other measures, one notable proposed provision being considered covers “reporting requirements to tighten sanctions implementation under the Countering America’s Adversaries Through Sanctions Act (“CAATSA”).” (See our coverage of CAATSA here, and subsequent developments here, here, here and here.) The proposal of Sens. Graham and Menendez may be modeled on a current reporting obligation in the U.S. Securities Exchange Act that requires issuers of certain securities to disclose in public filings with the U.S. Securities and Exchange Commission certain dealings with or involving Iran. See 15 U.S.C. § 78m(r).
Secure America from Russian Interference Act (H.R. 6437): This bill is a composite of 18 separate pieces of legislation that would add new sanctions against Russia and strengthen certain existing sanctions. New sanctions added by the bill include a prohibition on certain transactions related to Russian sovereign debt and the imposition of enhanced screening procedures for Russian visitors to the United States in order to exclude certain Russian political and business figures. In addition to new sanctions, the bill would require the President to impose sanctions on entities found to be in violation of CAATSA. The bill has 32 co-sponsors in the House, but there is no comparable Senate version of the bill.
DETER (Defending Elections against Trolls from Enemy Regimes) Act (S. 2785): This bill, which is also called DETER, would amend the Immigration and Nationality Act to render inadmissible to the United States any alien who seeks to engage in, or has engaged in, improper interference in a U.S. election. Senator Dick Durbin (D-Ill.) introduced the bill in the Senate in April 2018, but it has received only one additional co-sponsor thus far.
A bill to require the designation of the Russian Federation as a state sponsor of terrorism (S. 2780): This proposal would mandate that the State Department label Russia as a state sponsor of terror. The bill, introduced by Senator Joan Huffman (R-Tex.) in April 2018, has three other co-sponsors in the Senate but no comparable House version.
Countering Russian Power Plays Act (H.R. 6384): This proposal would sanction the Nord Stream 2 pipeline. It was introduced to the House by Representative Jared Huffman (D-Cal.) on July 16. It has received no additional co-sponsors, and there is no comparable Senate version of the bill.
Barring further negative developments in the U.S.-Russia relationship, it seems unlikely that all of these bills will transition from proposed legislation to law. However, if at least one of these proposals—particularly one of the first three discussed above—is passed by Congress and signed by President Trump, it would likely result in significant disruption for both U.S. and non-U.S. persons, similar to that seen in April 2018 when several significant Russia-related companies were subject to U.S. sanctions (see our previous coverage of those disruptions here).
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