Sanctions Top-5 for the week ending 24 January 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 US Office of Foreign Assets Control (OFAC) and the US State Department placed secondary sanctions on six companies and two individuals for engaging in significant transactions involving Iranian petroleum. The targets, who are based in China, Hong Kong, and Dubai, were named as Specially Designated Nationals (SDNs) under Executive Order 13846. (Read more about it in my team’s post on the Steptoe & Johnson International Regulation and Compliance Blog.)
  2. OFAC identified fifteen aircraft owned by Venezuela’s Petróleos de Venezuela SA (PdVSA) that are (and were) blocked property under Executive Order 13884. According to a Treasury Department news release, several of the aircraft have been used to transport Venezuelan government officials.
  3. OFAC announced a USD 12,150 settlement with a New York-based lobbying firm for violations of the Global Terrorism Sanctions Regulations (GTSR). According to the settlement notice, the firm agreed to provide lobbying services to Al-Barakaat Group of Companies Somalia Limited, a Specially Designated Global Terrorist (SDGT). The services were not covered by a general or specific license.
  4. EU High Representative Josep Borrell released a statement indicating that the remaining parties to the Joint Comprehensive Plan of Action (JCPOA) have agreed to extend the timeline outlined in the agreement’s dispute resolution mechanism in order to resolve concerns about Iran’s compliance with the deal. As mentioned last week, the foreign ministers of France, Germany, and the United Kingdom notified Iran that they would invoke the dispute resolution mechanism following Iran’s announcement that it would cease complying with certain provisions in the agreement.
  5. Russia and China are among the countries that have missed a December 2019 deadline to repatriate North Korean workers in compliance with UN Security Council Resolution 2397 (2017), according to reports. As mentioned last week, OFAC named two entities in North Korea and China as SDNs under Executive Order 13722 for facilitating the exportation of workers from North Korea.

Comments

Kung Hei Fat Choy, friends! Best wishes for a prosperous and happy Year of the Rat, with lots of emphasis on good health this year.

Last week’s OFAC settlement provides another reminder that US Persons should review general licenses carefully before entering into business with sanctioned clients. In this case, the lobbying services at issue were outside the scope of a general license for legal services contained in the GTSR (and most other OFAC regulations). No word on whether OFAC would have granted a specific license for the services, if asked.

The remaining participants in the JCPOA appear to be committed to preserving the agreement, based on the latest EU statements. What’s in it for Iran? With the specter of US secondary sanctions in the background, Iran hasn’t received the economic benefits it hoped for when it signed the deal in 2015. Now it’s negotiating to prevent the potential re-imposition of EU and UN sanctions and further international isolation.

Did I miss something? Send me a message or comment on LinkedIn.

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

US attorney in Hong Kong specializing in economic sanctions, financial crimes. Sign up for emails: http://eepurl.com/cVhTXf LinkedIn at: http://goo.gl/KX1jER

US attorney in Hong Kong specializing in economic sanctions, financial crimes. Sign up for emails: http://eepurl.com/cVhTXf LinkedIn at: http://goo.gl/KX1jER