Sanctions Top-5 for the week ending 29 May 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 big news: Donald Trump held a news conference on Friday to announce his administration would “begin the process” of revoking Hong Kong’s separate status from mainland China under US laws. This could include imposing heightened export controls under the Export Administration Regulations (EAR) and other steps. Additionally, the United States is expected to impose sanctions against Chinese and Hong Kong officials responsible for the erosion of Hong Kong’s autonomy. (For more on this issue, see my team’s Client Advisory.)

Comments

Friday’s White House news conference was short on specifics about how US laws might change in respect of Hong Kong. Anything at this point is speculation. Of all of the topics mentioned, sanctions is the easiest to implement in the short term. What are the options? For blocking sanctions we have: Section 7 of the Hong Kong Human Rights and Democracy Act of 2019, the Global Magnitsky program, and the International Emergency Economic Powers Act (IEEPA). Visa bans are authorized under Section 7031(c) of the FY 2019 Department of State, Foreign Operations, and Related Programs Appropriations Act (or as we like to call it, FORPA2). There is also the Hong Kong Autonomy Act pending in the Senate, which, if passed, would authorize blocking sanctions as well as menu-based secondary sanctions against financial institutions. Stay tuned.

Dr. Walker’s report contains a lot of helpful information about the humanitarian landscape in Syria and practical advice for handling transactions under various US, UN, and EU regulatory licenses and exemptions. It’s a must-read for anyone with an interest in humanitarian aid for sanctioned territories. “The creation of transparent and safe humanitarian payment corridors into highly complex risk environments requires collective vision,” Dr. Walker told me by email. “These principles have stemmed from an extensive 5 year process involving many banks, humanitarian organisations, international bodies and government officials.” (The report is available here.)

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.)

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Nicholas Turner

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