U.S. Sanctions and AML Measures Target Human Rights Abuses and Corruption
21 June 2018
- On June 12, the U.S. Treasury Department’s Financial Crimes Enforcements Network issued an advisory to U.S. financial institutions to “highlight the connection between corrupt senior foreign political figures and their human rights abuses.”
- Other recent U.S. actions, such as the recent imposition of sanctions under the Global Magnitsky Act and special measures under the USA PATRIOT Act against ABLV Bank, also demonstrate the increased leveraging of U.S. economic sanctions and anti-money laundering requirements to target financial support for human rights abuses and foreign corruption.
- U.S. financial institutions and other companies should be mindful of these developments in their compliance approach to non-U.S. activities, particularly in areas with higher human-rights and corruption risks.
U.S. Sanctions and AML Measures Target Human Rights Abuses and Corruption
15 June 2018
Companies that have relied on Ukraine General License 12, 12A, 12B or 12C to transact with sanctioned Russian entities should remember to file a report of the transactions with the Office of Foreign Assets Control (“OFAC”) no later than this Tuesday, June 19, 2018. General License 12C expired by its terms at 12:01 a.m. on June 5, 2018, and requires a report to OFAC of all transactions conducted under the license by 10 business days after the expiration date. The reports must include the names and addresses of the parties involved in the transactions, the type and scope of transactions conducted, and the date on which the transactions occurred. Failure to report or late reporting is a breach of the conditions of the license and could result in civil monetary penalties or other enforcement action by OFAC.
General License 12C and its predecessors authorized certain transactions for wind-down or maintenance of existing operations, contracts or agreements with AgroHolding Kuban, Basic Element Limited, B-Finance Ltd., EN+ Group PLC, JSC EuroSibEnergo, GAZ Group, Gazprom Burenie OOO, Ladoga Menedzhment OOO, NPV Engineering Open Joint Stock Company, Renova Group, Russian Machines, United Company RUSAL PLC, and any other entity 50% or more owned by one or more of them. However, transactions with RUSAL, GAZ, EN+, EuroSibEnergo or their 50% or greater subsidiaries, if conducted under General License 14, 15 or 16 after the relevant license came into effect, may be reported within 10 days after expiration of the applicable license.
The reporting requirement applies only to U.S. persons—that is, companies organized under U.S. law, U.S. citizens, U.S. permanent residents, and persons within the United States at the time of the transaction—or to transactions taking place at least partly within the United States. No report is required from non-U.S. companies for transactions lacking a U.S. nexus. OFAC has stated that it will not impose sanctions against foreign persons for transactions that could have lawfully been conducted by a U.S. person under a general license, but the general license itself (like the underlying prohibition that it modifies) does not directly apply to transactions of non-U.S. persons in the absence of a connection to the United States.
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Russian Counter-Sanctions Law Is In Force
8 June 2018
- On June 4, 2018, the Russian Law on Counter-Measures for Hostile Actions of the United States and Other Foreign States came into force.
- The Counter-Sanctions Law allows implementation of measures in response to hostile actions against the Russian Federation and Russian persons. These measures may target the United States and other foreign states committing hostile actions, entities controlled or affiliated with hostile states, and officials and citizens of these states that are involved in hostile actions.
- Counter-sanctions may include termination and suspension of international cooperation with hostile states, restrictions on imports and exports to and from hostile states, restrictions on performing work for Russian state and municipal authorities and for certain types of entities, restrictions on participation in privatization of Russian state property, and other measures determined by the Russian President.
- Although the Counter-Sanctions Law vests broad authority in the Russian President and the government to impose sanctions, it does not mandate any sanctions.
President Trump Withdraws U.S. from Iran Deal, Announces Restoration of Sanctions
9 May 2018
- Yesterday, President Trump announced that the United States is withdrawing from the Joint Comprehensive Plan of Action, under which certain sanctions were suspended in exchange for limitations on Iran’s nuclear program.
- After an initial wind-down period, the United States will be fully reinstating its nuclear-related sanctions waived under that agreement, including banning foreign subsidiaries of U.S. companies from dealing with Iran and imposing secondary sanctions on foreign companies that engage in certain Iran-related transactions.
- We are hosting seminars in London (16 May) and New York (23 May) discussing this, other recent sanctions and related developments. In New York, due to client demand, we are now offering this seminar in person and via webcast. Please register for these events - for the London event click here, New York event in person click here, New York event via webcast click here.
U.S. Sanctions Against Russia Continue to Disrupt
30 April 2018
- Recent U.S. sanctions against Russian persons and entities are noteworthy for their apparent impact on global financial and commercial activities.
- Despite efforts by U.S. authorities to mitigate immediate disruptions, both U.S. and non-U.S. persons continue to struggle with questions arising from these sanctions.
- We are hosting seminars on this and other recent sanctions-related developments in London (16 May) and New York (23 May) – register for these events here (London) and here (New York).
United States Imposes New Restrictions on Cuba Trade and Travel
13 November 2017
- On Thursday, the U.S. government imposed new restrictions on transactions with entities owned by the Cuban military, intelligence and security services.
- The newly restricted entities include significant commercial enterprises in Cuba, including major hotels.
- Authorizations for personal and educational travel to Cuba also have been cut back.
U.S. Issues Guidance on New Russian Sanctions
6 November 2017
- Last week, the U.S. Departments of State and Treasury issued new guidance on the implementation of recent legislation imposing sanctions against Russia.
- The guidance pertains mostly to new “secondary sanctions,” which seek to discourage non-U.S. persons from engaging in certain targeted activities with or involving Russia.
- The guidance defines several key terms and narrows the potential scope of several provisions, removing some uncertainty regarding how the U.S. government intends to apply these new sanctions.
U.S. Issues Guidance on Sanctions Relating to Russia’s Defense and Intelligence Sectors
October 30, 2017
- On Friday, October 27, the U.S. Department of State issued public guidance on the implementation of Section 231 of the Countering America’s Adversaries Through Sanctions Act (CAATSA).
- Section 231 of CAATSA requires the U.S. President to impose potential sanctions against individuals or entities that knowingly engage in “significant transactions” with persons that are a part of, or operating for or on behalf of, Russia’s defense or intelligence sectors.
- The new guidance is accompanied by a list of entities considered to be operating in Russia’s defense or intelligence sectors and a discussion of when a transaction is “significant” for purposes of Section 231.
- Defense- and intelligence-related transactions are more likely to be considered “significant,” while transactions with purely civilian end-uses or end-users or transactions required by law with the Federal Security Service are less likely to raise any sanctions risks.
Implementing the CAATS Act: Revisions to Sectoral Sanctions Against Russia
October 3, 2017
- To implement the Countering America’s Adversaries through Sanctions Act (the “CAATS Act”), the U.S. Treasury Department has amended U.S. sectoral sanctions against Russia, effective November 28, to bar U.S. persons from transactions in debt of over 14 days' maturity of designated Russian financial services firms or over 60 days' maturity of designated Russian energy firms.
- President Trump concurrently issued a presidential memorandum delegating certain functions and authorities of the CAATS Act, principally to the Secretaries of State and Treasury.
- Senators Cardin and McCain sent an open letter to President Trump calling for broad implementation of the CAATS Act, particularly in regard to the defense and energy sectors.
United States Imposes New Sanctions on North Korea
September 26, 2017
- On Wednesday, 20 September 2017, President Trump signed Executive Order 13810, further expanding U.S. sanctions targeting North Korea.
- The new executive order, for the first time, authorizes the U.S. Treasury Department to sanction foreign banks that engage in “significant” transactions with North Korea, and to block specific bank accounts linked to North Korea.
- New commercial sanctions target North Korea’s business operations and international partners, including by authorizing new blocking sanctions against both North Korean persons and third-country nationals that undertake certain business activities in or involving North Korea.
United States Imposes New Sanctions on Venezuela
August 28, 2017
- On Friday, the Trump administration imposed sanctions on Venezuelan government entities, including the Venezuelan oil company PdVSA.
- The sanctions bar certain transactions in equity and debt, including existing securities in some cases.
- General licenses create some carve-outs from the sanctions, including for transactions with CITGO and transactions involving certain pre-existing Venezuelan bonds.
U.S. Congress Passes Final Sanctions Legislation
July 28, 2017
- On July 27, 2017, the U.S. Congress passed a bill that expands U.S. sanctions against Russia and adopts additional sanctions against Iran and North Korea.
- If adopted as law, the bill would, among other actions, establish a congressional review process to authorize any changes to existing sanctions against Russia, expand the sectoral sanctions program and authorize secondary sanctions against non-U.S. persons for engaging in certain Russia-related activities.
- The White House has given no indication whether President Trump will sign the bill or use his veto authority, but there is a strong chance that any veto would be overridden by Congress.
U.S. Senate Seeks to Expand Sanctions on Iran, Russia
June 30, 2017
- The U.S. Senate recently voted 98-2 to adopt legislation aimed at strengthening sanctions against Iran and Russia.
- The bill proposes, among other actions, to expand the scope of U.S. sanctions, tighten existing restrictions and limit the Executive Branch’s ability to dismantle the current sanctions targeting Russia and Russian companies.
- If the bill becomes law, we expect the immediate changes to existing sanctions would be incremental, but over a longer term, the bill may result in the current sanctions against Russia becoming a fixed feature of U.S. policy.
U.S. Sanctions on Iran: The Trump Administration’s First Actions
February 8, 2017
- In response to Iran’s recent ballistic missile tests, OFAC has added several individuals and entities with ties to Iran to the SDN List.
- Though the Trump administration has been outwardly critical of the Iran Nuclear Deal inherited from the Obama administration, these new sanctions do not appear to represent a departure from previous U.S. policy toward Iran.
- Tensions between the U.S. and Iran continue to build, and the Trump administration has said that it is putting Iran “on notice” regarding further provocative behavior.
U.S. Sanctions Under a Trump Administration
December 13, 2016
- In recent years, the Obama administration has made significant changes to U.S. sanctions regimes, including relaxing US sanctions related to Cuba and Iran, and imposing new sanctions on Russia.
- President-elect Trump has been critical of many of these changes and appears to be employing advisers and staffing his Cabinet with those who share his views.
- Because the Obama administration’s changes were implemented through executive action, President-elect Trump will have substantial discretion to unwind many of the changes.
OFAC Provides Additional Iran Sanctions Guidance
June 14, 2016
- OFAC has clarified the scope of what U.S. companies may do in regard to Iran.
- U.S. banks may operate correspondent accounts for third-country banks that deal with Iran but may not process Iran-related transactions.
- U.S. companies may allow their foreign subsidiaries to establish a physical presence in Iran.
- Non-U.S. companies should adopt policies excluding U.S. directors and management from participating in Iran-related transactions.
- A company owned 50% or more by U.S. persons is treated as U.S.-owned, except for publicly traded companies with diffuse ownership.
UK Getting More Serious About Sanctions
April 27, 2016
- New draft law seeks to bolster the UK government’s options to enforce breaches of sanctions by creating powers akin to those the Office of Financial Assets Control and the U.S. Department of Justice wield.
- The new law would increase criminal penalties, create a new regime of civil penalties and make deferred prosecution agreements available for sanctions violations.
- The proposed changes follow the recent creation of the Office of Financial Sanctions Implementation which is charged with enhancing enforcement and improving businesses’ understanding of sanctions.
Implementation Day – Iran Sanctions Relief Now Effective
January 19, 2016
- Sanctions relief under the Iran nuclear deal took effect on January 16, 2016.
- The U.S. has suspended most secondary sanctions applicable to non-U.S. companies dealing with Iran, authorized non-U.S. entities owned or controlled by a U.S. person to transact most business with Iran, and removed many entities from U.S. sanctions lists.
- The EU has terminated the majority of the restrictions on trade and finance transactions with Iran.
- Despite these changes, important restrictions remain in effect, and firms seeking to do business with Iran should proceed with care.
U.S. and EU Take First Steps to Implement Nuclear Deal with Iran
October 28, 2015
- U.S. and EU adopt legal framework for suspension of nuclear-related sanctions against Iran.
- Changes are contingent on confirmation of Iran’s compliance with its nuclear commitments.
- Suspension is expected to take effect in early 2016.
- U.S. primary embargo against Iran will remain in place.
U.S. Further Relaxes Cuba Sanctions
October 14, 2015
- Last month, U.S. authorities announced further relaxations and adjustments to the United States’ embargo of Cuba.
- Many of the changes eliminate barriers to types of transactions that were first authorized earlier this year.
- U.S. companies and their subsidiaries may now establish a physical presence in Cuba in support of most types of authorized transactions.
- U.S. trade with Cuba, and trade with Cuba by U.S. companies and their subsidiaries, remains prohibited outside certain narrow categories.
OFAC Updates Russia and Ukraine Sanctions Lists, Issues Advisory on Evasion of Crimea Embargo
August 5, 2015
- On July 30, 2015, the United States updated the Russia and Ukrainian sanctions lists.
- Several individuals and entities were newly added to the list of Specially Designated Nationals and Blocked Persons.
- The U.S. Treasury Department’s Office of Foreign Assets Control also updated the Sectoral Sanctions Identifications List by adding several subsidiaries of the Russian bank Vnesheconombank (VEB) and the Russian oil company OJSC Rosneft Oil Company, which were already treated as subject to sectoral sanctions by operation of law, as well as issued an advisory to alert U.S. companies about attempts to evade the U.S. trade restrictions on Crimea.
Iran Nuclear Sanctions Deal Reached
July 17, 2015
- On 14 July 2015, Iran, the EU and the P5+1 (the United States, United Kingdom, France, China, Russia and Germany) reached a historic deal for Iran to wind down its nuclear programme in exchange for sanctions relief. This agreement has been memorialized in the Joint Comprehensive Plan of Action (the “JCPOA”).
- The JCPOA does not provide any immediate sanctions relief to Iran; instead, US and European Union sanctions will be withdrawn in a phased manner, based on Iran achieving certain milestones.
- The first phase of sanctions relief will take place when the International Atomic Energy Agency (the “IAEA”) verifies that Iran has completed certain decommissioning steps relating to its nuclear weapon programme.
- Further sanctions relief will follow based on the effluxion of time or the IAEA providing further confirmations about Iran’s nuclear programme.
- Although it is likely to take a number of months before the first stage of EU and US sanctions relief is implemented, the JCPOA is a landmark step towards reopening the Iranian market for Western businesses.
EU Extends Ukraine-Related Sanctions
June 24, 2015
- The EU has extended the economic sanctions imposed on Russia in response to the ongoing situation in Crimea and Sevastopol.
- The so-called “sectoral sanctions” remain effective until 31 January 2016, while the restrictions on dealing with Crimea will remain effective until 23 June 2016.
- Leaders of the G7 have also promised further restrictive measures on Russia if necessary.
Congress Establishes Framework for U.S. Approval of Iran Sanctions Deal
May 15, 2015
- Both houses of the US Congress have passed the Nuclear Agreement Review Act of 2015 allowing Congress to review any deal with Iran limiting Iran’s nuclear programme in exchange for removal of sanctions.
- A framework agreement was reached on 2 April between the EU, P5+1 (the US, UK, France, China, Russia and Germany) and Iran, described as parameters for a final agreement. Under the agreement, most UN, EU and US sanctions affecting Iran’s oil industry will be suspended or lifted.
- A deal with Iran is not yet final or certain: amongst other things, consensus has not been reached on what sanctions are to be removed under any final agreement.
- If a deal is reached and sanctions are lifted, any “rush back to Iran” will be slow and paced.
U.S. to Remove Cuba from List of State Sponsors of Terrorism
April 15, 2015
- Key takeaways U.S. removal of Cuba from the State Sponsors of Terrorism list takes effect in 45 days.
- The delisting has both practical and symbolic significance for U.S.-Cuba relations but will not lift the U.S. embargo against Cuba.
- The announcement signals apparent progress in the negotiations to normalize relations between the two countries.
U.S. Authorizes Cyber Sanctions, Recommends Tech Companies Adopt Compliance Programs
April 6, 2015
- On April 1, 2015, President Obama issued a new Executive Order authorizing sanctions against persons that engage in certain significant and malicious cyber-enabled activities that threaten the United States.
- Concurrently, the Treasury Department’s Office of Foreign Assets Control has called on “firms that facilitate or engage in online commerce” and other technology companies to have in place “a tailored, risk-based compliance program, which may include sanctions list screening or other appropriate measures.”
- In light of this guidance, it may be prudent for technology and e-commerce companies to review their sanctions-related risks and enhance their compliance programs to address this new sanctions framework.
U.S. Updates Cuba Sanctions and Export Regulations
January 20, 2015
- On January 16, 2015, the United States implemented measures to ease its ongoing embargo of Cuba.
- The changes expand the scope of permitted activities, including certain transactions related to travel and telecommunications.
- The changes also eliminate the requirement of government preapproval for certain activities that were previously licensable.
- The core trade embargo remains in place, and most transactions between persons subject to U.S. jurisdiction and nationals of Cuba remain prohibited.
U.S. and EU Sanctions: How Are Insurers Affected?
January 12, 2015
- The recent imposition of sanctions against Russia has highlighted the great effect sanctions can have on global economic transactions.
- Breaches of the U.S. and EU’s sanctions regimes often constitute criminal offences and can lead to substantial fines, imprisonment and negative publicity. U.S. regulators in particular have been levying significant fines for violations of sanctions.
- Financial companies, including insurers and brokers, tend to be the chief targets of prosecutors and regulators. Interest in insurance activities is set to increase – especially as so many insurance transactions may involve persons or countries subject to sanctions.
- Several types of sanctions directly affect the insurance industry: specific insurance bans, asset freezes, restrictions on fund transfers.
- In light of this, insurers and brokers should be looking seriously at their compliance systems and processes, and must ensure they thoroughly know their clients and their clients’ businesses.
U.S. and EU Continue to Expand Ukraine-related Sanctions and Clarify Sanctions Targeting Russian Companies
January 8, 2015
- The United States has imposed a comprehensive ban on trade with Crimea, and exporters of U.S. goods to Russia should consider implementation of effective safeguards to ensure that products sold to Russian distributors are not destined for Crimea.
- The European Union has also extended its existing trade restrictions on Crimea and Sevastopol but has not imposed a comprehensive ban on all trade with the region.
- Separately, the United States and European Union have provided clarifications and guidance regarding their respective sanctions targeting Russian companies, including the restrictions on providing finance to designated Russian companies and the sanctions on Russia’s energy industry.
United States to Ease Cuba Sanctions
December 17, 2014
- The United States and Cuba are taking steps to normalize diplomatic relations.
- The United States has announced that it will ease certain aspects of its embargo of Cuba, including those involving financial services, exports, travel and remittances.
- The changes to the embargo will not take effect until the U.S. Treasury and Commerce Departments issue amendments to their regulations.
U.S. Expands Sectoral Sanctions against Russia, Blocks New Defense Companies
September 15, 2014
- The United States, immediately following similar actions by the European Union, expanded the scope of the sectoral sanctions against Russia by designating more Russian companies as well as expanding the scope of restrictions imposed on US persons’ dealings with designated companies.
- Blocking sanctions targeting Russia’s defense industry have been expanded to include several additional defense technology companies.
EU Expands Sector-Wide Sanctions on Russia, Imposes Sanctions on New Individuals and Entities
September 15, 2014
- The EU has expanded its package of sanctions targeting the banking, energy and defence sectors of the Russian economy.
- Additional capital market restrictions have been imposed on dealing with transferable securities and money-market instruments, including reducing the maximum maturity limit of such financial instruments from 90 days to 30 days.
- The EU has expanded its list of sanctioned individuals and entities, including the listing of 15 entities and 24 individuals.
Businesses Wary of Impact of Ukrainian Sanctions
September 2, 2014
- On 14 August 2014, the Ukrainian Parliament adopted legislation creating a legal framework for the imposition of sanctions on countries, foreign individuals and foreign entities, including the authorisation of over 20 subject specific measures.
- Although no sanctions have yet been passed on individual entities, we have received a number of queries from multinationals with business interests in Ukraine that could in due course be directly or indirectly affected by sanctions introduced under the legislation.
- Affected entities with Ukrainian-based investments may have some recourse through a number of bilateral or multilateral investment treaties entered into between Ukraine and those investors’ home states, in particular the Russia-Ukraine Bilateral Investment Treaty, which permits investors to elect to arbitrate claims of undue expropriation before international tribunals. Other rights of action under international conventions are also outlined.
OFAC Revises and Clarifies “50% Rule”, Combines Ownership Interests of Different Blocked Persons
August 18, 2014
- Last week, OFAC revised its guidance on the circumstances under which an entity that is not itself designated for sanctions is nonetheless subject to US sanctions because it is owned 50% or more by a sanctioned person.
- OFAC now requires that, for purposes of calculating the 50% threshold, all ownership interests of sanctioned persons are aggregated.
- OFAC simultaneously released new FAQs that clarify certain related issues, including a statement that US persons cannot negotiate, contract or otherwise transact with a blocked person even if that blocked person is acting on behalf of a non-sanctioned company.
US Imposes Export Sanctions Against Russian Oil and Gas Sector
August 8, 2014
- The US has banned the exportation of items destined for use in Russian deepwater, shale and Arctic offshore oil and gas projects.
- The export ban applies to a wide range of items used in oil and gas exploration, if the exporter has reason to know they will be used for the specified types of projects in Russia.
- There is no exemption for performance of existing contracts.
Russia Imposes Restrictions on Agricultural Imports from the US, EU, Canada, Australia and Norway
August 8, 2014
- On 7 August 2014, the Russian Government adopted an official ban on imports of a wide range of agricultural products originating from the US, the EU, Canada, Australia or Norway. The Federal Customs Service has been designated to enforce the ban, and has commenced enforcement already.
- The introduction of the imports ban, on top of the recent restrictions on agricultural imports from several countries on sanitary grounds, may lead to significant legal consequences including disruption of contracts, and creates potential for liability and other disputes. The actual impact may be broader than that and needs to be closely reviewed by the parties operating in the sector.
- The client update discusses a number of the key legal issues that the parties are likely to encounter.
EU Imposes Sector-Wide Sanctions on Russia, Imposes Sanctions on New Individuals and Entities
July 31, 2014
- The EU has adopted a package of sanctions targeting the banking, energy and defence sectors of the Russian economy.
- Additional restrictions have been imposed on trade and investment in Crimea and Sevastopol.
- The EU has expanded its list of sanctioned individuals and entities, including the designation of senior Russian officials and the president of the Republic of Chechnya.
US Announces New Sanctions on Russian Companies, Provides Guidance on Transactions Involving SSI Entities
July 29, 2014
- The US announced three Russian banks have been added to the Sectoral Sanctions Identification List, and United Shipbuilding Corporation, a state-owned defense company, is now subject to blocking sanctions.
- OFAC published new Frequently Asked Questions discussing transactions by US persons with Russian companies on the Sectoral Sanctions Identification List.
- Among other issues, the new guidance addresses depositary receipt programs, loan facilities and letters of credit, as well as issues involved in identifying newly-issued equity.
EU Expands Sanctions in Respect of Ukraine
July 17, 2014
- The EU has expanded its Ukraine-related sanctions and is considering further additions to its regime. A list of additional affected entities is expected at the end of July.
- The EU has taken steps to impede the flow of public money into Russia.
- The EU has not introduced targeted measures but continues to prepare such measures for deployment if needed.
United States Expands Sanctions on Russia, Introduces Limited Sectoral Sanctions Against Four Companies
July 16, 2014
- The US has imposed limited sanctions on Gazprombank, Vnesheconomobank, Rosneft, Novatek and their subsidiaries.
- The designated banks and energy companies are not blocked, but US persons are restricted from engaging in transactions involving new equity and new long-term debt of the designated companies.
- The US has blocked the property of eight Russian arms manufacturers, including Kalashnikov Concern, as well as additional Russian government officials.
European Union Bans Imports of Goods from Crimea
June 27, 2014
- EU bans imports of goods from Crimea or Sevastopol.
- Grandfathering clause allows performance of pre-existing contracts until September 26.
- Importers, financiers and insurers should exercise due diligence over supply chains.
EU Expands Ukraine-Related Sanctions; US Targets Russian Bank for Aiding Syrian Government; US Updates Sanctions Rules
May 14, 2014
- The European Union has expanded the criteria for its Russia/Ukraine sanctions regime, imposing sanctions on a further 13 individuals.
- For the first time in connection with the Ukraine crisis, the EU has also frozen the assets of two companies, one of which was previously blocked by US sanctions.
- The United States has issued new regulations clarifying and updating its Syrian and Ukraine-related sanctions programs, and it has frozen the assets of a Russian bank and its chairman under the US-Syria sanctions program.
US and EU Expand Sanctions Against Russia
April 29, 2014
- The United States and the European Union, in response to events in Ukraine, recently expanded their respective sanctions programs.
- The European Union imposed sanctions on a further 15 individuals, including a number of Russian government officials.
- The US Treasury Department designated 17 entities and 7 individuals, including 2 senior executives of state-owned companies.
United States Authorizes Aid to Ukraine and Adopts New Sanctions
April 11, 2014
- The United States continues to react to recent events in Ukraine and, last week, President Obama signed into law two bills that are designed to respond to the events there.
- One of the newly enacted laws authorizes new sanctions, including with respect to Russian officials deemed responsible for significant acts of corruption in Ukraine or Russia.
The Effect of the Crisis in Ukraine on Russian Deals – Part II
March 31, 2014
- The current situation in Ukraine continues to develop swiftly, with headlines being made daily by events within the country, international diplomatic efforts and economic consequences.
- The US and EU have expanded the potential scope of sanctions and several additional people have been specifically targeted.
- The US has named 27 individuals and one Russian bank, while the EU has sanctioned 33 individuals. Other countries are following suit.
- Against this backdrop, questions continue to be asked about the potential impact on deals, operations, pending lawsuits, etc.
- This update acts as a follow on from our update of March 13th, and aims to collect some of the further key concerns and questions being raised out of the current situation.
EU Expands Sanctions Against Russia
March 21, 2014
- The European Union has frozen the assets of a further 12 Russian and Ukrainian individuals in respect of Ukraine-related sanctions.
- The European Union is considering further sanctions.
- The UK has suspended all licences for export to Russia of military or dual-use items destined for use by Russian state agencies “against Ukraine”.
U.S. Expands Sanctions; Russia Responds
March 20, 2014
- The United States has blocked the assets of 20 Russian individuals and a Russian bank.
- The European Union is considering further sanctions against Russia.
- Russia has imposed a visa ban on nine United States government officials.
The United States and European Union Impose Sanctions on Russian Officials
March 18, 2014
- The United States and European Union have imposed asset freezes on certain officials of the Russian, Crimean and former Ukrainian governments.
- To date, only individual government officials have been targeted, not businesses or government-owned entities.
- Additional US and EU sanctions as well as possible Russian countermeasures may be imposed as the situation develops.
The Effect of the Crisis in Ukraine on Russian Deals
March 13, 2014
- The current situation in Ukraine continues to develop incredibly swiftly, with headlines being made daily by events within the country, international diplomatic efforts and potential economic consequences.
- Against this backdrop, and triggered in particular by the moves towards economic sanctions being taken by the US and the EU, questions continue to be asked about the potential impact on deals, operations, pending lawsuits, etc.
- This update acts to collect in one place some of the key concerns and questions being raised out of the current situation.
United States and European Union Adopt Ukraine-Related Sanctions
March 7, 2014
- The US has established a framework for sanctioning individuals and entities involved in the situation in Ukraine.
- The EU has already frozen the assets of 18 senior officials of the ousted Ukrainian government.
- Additional asset freezes and other sanctions may be forthcoming if the situation is not resolved through diplomacy.
The Zimbabwe Elections and the Current State of Sanctions
August 21, 2013
- The recent Zimbabwean elections may have a significant impact on EU sanctions on the country: prior to the elections, the EU ambassador to South Africa stated that the EU would lift sanctions if the elections were “internationally recognized”.
- International opinion remains split as to the legitimacy of the elections, and the EU has yet to come to a decision.
- A lifting of EU sanctions would provide more freedom to those wishing to engage with the Zimbabwean mining industry, particularly its diamond sector -- but investors need to remain aware that other sanctions will remain in place, particularly those imposed by the US.
U.S. Government Imposes New Sanctions Against Iran
June 27, 2013
- In the past month, President Obama and the U.S. Treasury Department each took steps to intensify the economic and trade sanctions maintained by the United States against Iran.
- The latest actions target, in particular, the Iranian petrochemical, automobile, energy, shipping, precious and other metals, and airline sectors as well as entities, wherever located, that do business with those sectors.
- Firms, whether based in the United States or abroad, may wish to ensure that their compliance programs are updated in accordance with these latest changes.
EU and US Amend Burmese Sanctions
April 30, 2013
- The European Union and United States have both taken steps to lift economic and trade sanctions applicable to dealings with Burma. These steps are a welcome development for E.U. and U.S. businesses seeking to invest in Burma.
- On April 22, 2013, the European Union lifted all sanctions on Burma with the exception of an arms embargo. This follows a suspension of most sanctions in May 2012.
- Although the United States has not formally repealed the Burmese sanctions, the Treasury Department’s Office of Foreign Assets Control, in consultation with the U.S. State Department, has issued general licenses that authorize nearly all transactions with Burma that would otherwise be prohibited.
Further Expansion of U.S. Sanctions Against Iran
January 24, 2013
- The United States continues to seek to isolate Iran from global commerce. Earlier this month, President Obama signed into law the fourth new U.S. sanctions law against Iran in the last three years, and the Treasury Department's Office of Foreign Assets Control issued an advisory to U.S. financial institutions cautioning them on Iran's activities.
- The new law -- the Iran Freedom and Counter-Proliferation Act of 2012 -- targets Iran's energy, shipping, shipbuilding and precious metals sectors and, like past Iran sanctions laws, applies extra-territorially.
- The new law also sanctions those who provide underwriting, insurance or reinsurance services for an activity with respect to Iran that is prohibited under U.S. law.
- The new advisory alerts U.S. financial institutions of certain activities that Iranian institutions are conducting to avoid international sanctions regimes and suggests the adoption of enhanced due diligence as a counter-measure.
SEC Reporting Companies Must Disclose Certain Iran-Related Activities
January 15, 2013
- New Section 13(r) of the Exchange Act mandates all reporting issuers to disclose certain Iran-related business activities conducted by the issuer or any affiliate of the issuer (including directors and officers).
- The specified activities are broadly defined and need not be directly with Iran or an Iranian person. They generally relate to Iran's energy sector, the development of weapons of mass destruction or military capabilities or human rights abuses.
- Issuers must disclose in detail the nature and extent of the activity, the gross revenues and net profits attributable to the activity and whether the issuer or its affiliate intends to continue the activity. Upon receipt of a "Notice of Disclosure" of Iran-related activities, the SEC must transmit the periodic report to the President and the U.S. Congress and post the information on the SEC's website.
- This new disclosure requirement is effective with respect to any annual or quarterly report required to be filed with the SEC after February 6, 2013.
Expansion of U.S. Sanctions Against Iran and Syria
- Article included as part of Debevoise’s FCPA Report publication
- On October 9, 2012, President Obama issued Executive Order 13628, which prevents foreign subsidiaries of U.S. companies from engaging in most transactions with Iran.
- This Executive Order applies the United States’ existing comprehensive sanctions against Iran to entities that are owned or controlled by U.S. persons.
- Until now, foreign firms that were owned or controlled by U.S. parents were generally free, under U.S. law, to trade with Iran, provided the U.S. parent did not facilitate the transactions.