Here are five things that happened this week in the world of economic sanctions that I think you should know about.
- In a surprise move, the Standing Committee of China’s National People’s Congress (NPCSC) decided to postpone the adoption of a measure to incorporate elements of the PRC Anti-Foreign Sanction Law into Hong Kong’s Basic Law. According to reports, the delay will allow Chinese lawmakers more time to gather information and consider the issue.
- The US Office of Foreign Assets Control (OFAC) named nine individuals and two entities in Russia as Specially Designated Nationals (SDNs) on the one-year anniversary of the suspected poisoning of opposition figure Alexey Navalny by the Russian government. The US State Department also announced additional import and export restrictions on Russian firearms and nuclear- and missile-related goods and technology under the Chemical and Biological Weapons Control and Warfare Elimination Act of 1991 (the CBW Act). Meanwhile, the UK government announced targeted sanctions on operatives of Russia’s Federal Security Service.
- In related news, the White House released a new Executive Order authorizing SDN sanctions on persons involved in the Nord Stream 2 and TurkStream pipeline projects. Meanwhile, OFAC named two entities and two vessels in Russia as SDNs under the new Executive Order and moved several (previously sanctioned) entities and vessels from the Non-SDN Menu-Based Sanctions List (NS-MBS List) to the SDN List.
- The US Commerce Department’s Bureau of Industry and Security (BIS) entered into a settlement with a California company for violations of the Export Administration Regulations (EAR). According to the Settlement Agreement, the company exported semiconductor equipment to a distributor with reason to know the goods were destined for a Chinese company on the Entity List.
- OFAC named three Cuban officials as SDNs under the Global Magnitsky Sanctions program in response to the Cuban government’s suppression of protests in the country since July 2021.
Apparently, the NPCSC saw no reason to rush into adopting a Hong Kong version of the Anti-Foreign Sanction Law. And why would they? Business in Hong Kong is booming despite foreign sanctions. A hastily passed law could upset that. As I’ve said before, it’s probably inevitable that the law will come to the Special Administrative Region given its importance to China’s national security. But it may be some time before we know what it will look like. (No complaints from me!)
As mentioned in May 2021, the Biden administration waived secondary sanctions against Nord Stream 2 AG and its CEO and corporate officers under the Protecting Europe’s Energy Security Act (PEESA). The new Executive Order and SDN designations (most of which are just a reshuffle from the NS-MBS List to the SDN List) are probably more for political consumption in Washington than anything. (For more on the Nord Stream 2 issue, read my team’s blog post here.)
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(The views expressed are my own and do not constitute legal advice. Photo from Vladislav Reshetnyak.)