Sanctions Top-5 for the week ending 12 June 2020

Here are five things that happened this week in the world of economic sanctions that I think you should know about.

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1. The White House announced the issuance of long-threatened Executive Order 13928 authorizing sanctions against anyone who assists the International Criminal Court (ICC) in investigating, arresting, detaining, or prosecuting “any United States personnel” or “any personnel of a country that is an ally of the United States” without the consent of the United States or allied country, respectively.
2. The US State Department announced that non-proliferation sanctions under Executive Order 13382 against the Islamic Republic of Iran Shipping Lines (IRISL) and its Shanghai-based subsidiary E-Sail Shipping Company Limited are now effective following a 180-day grace period announced in December 2019.
3. Media reported that authorities in Cape Verde detained Alex Saab Morán, a Colombian business magnate and close associate of Venezuelan President Nicolás Maduro, when his private jet made a refueling stop en route to Iran. As previously reported, the US Office of Foreign Assets Control (OFAC) named Saab as a Specially Designated National (SDN) in July 2019 for his role in a Venezuelan money laundering and bribery scheme. According to reports, Saab potentially could be taken into custody by US authorities, despite the lack of a US-Cape Verde extradition treaty.
4. The Republican Study Committee, a conservative-leaning US House of Representatives caucus, released its “National Security Strategy” including, among other ideas, proposals for a raft of sanctions against Chinese officials and “the toughest package of sanctions on Russia ever proposed by Congress.” (Read the report here.)
5. The US State Department announced visa bans against former Guatemalan Presidential Chief of Staff Gustavo Adolfo Alejos Cambara, his wife, and three children, under Section 7031(c) of the Department of State, Foreign Operations, and Related Programs Appropriations Act, 2020. According to a State Department news release, Alejos engaged in unspecified “corrupt acts that undermined rule of law and the Guatemalan public’s faith in their government’s democratic institutions, officials, and public processes.”

Comments

Gosh, John Bolton is having a great month. His new book is getting loads of press. And his diabolical plan to sanction the ICC is finally coming to fruition. The introduction of Executive Order 13928 follows weeks of public tension with top military leaders after the forceful removal of protesters near the White House to make way for a presidential photo op. Earlier, in November 2019, Donald Trump pardoned two US service members convicted or accused of war crimes in Afghanistan. The Executive Order as written merely authorizes sanctions. Unclear if it will actually be used against individuals working for the ICC. But it did get some headlines.

The State Department announcement regarding IRISL and E-Sail seems to strongly imply that secondary sanctions could be used against exporters of humanitarian items to Iran. According to a press statement, the State Department provided a “generous [180-day] delay” to “allow exporters of humanitarian goods to Iran sufficient time to find alternate shipping methods.” While the US government generally excludes humanitarian trade from the scope of secondary sanctions, that exclusion does not apply to transactions with SDNs, unless otherwise licensed. These “designations serve as a clear warning that anyone doing business with or otherwise supporting IRISL or E-Sail are exposed to potential [secondary] sanctions,” the statement says.

Don’t miss today’s webinar, “How Robust is Your OFAC Sanctions Compliance Program?” hosted by LexisNexis Risk Solutions, at 11:00 a.m. Hong Kong time. Doug Wolfson and I will talk about OFAC compliance, technology, and the ever-tricky US financial system. Register here.

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(The views expressed are my own and do not constitute legal advice. Photo from Vladislav Reshetnyak.)