Sanctions Top-5 for the week ending 30 July 2021

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. According to reports, China’s National People’s Congress may consider a draft bill to incorporate elements of the recently adopted PRC Anti-Foreign Sanction Law into Hong Kong’s Basic Law. It’s too soon to say what the impact could be. (More on this below.)
  2. The US Office of Foreign Assets Control (OFAC) named eight prisons in Syria and five senior security officials as Specially Designated Nationals (SDNs) under Executive Orders 13894 and 13572. According to a Treasury Department news release, the facilities are “run by the Assad regime’s intelligence apparatus” and are linked to serious human rights abuses committed since 2011. OFAC also sanctioned Ahrar al-Sharqiya, a militant group, under Executive Order 13894 in response to a litany of abuses against Syrian civilians.
  3. OFAC named the Policia Nacional Revolucionaria (PNR) of the Cuban Ministry of the Interior and the PNR’s director and deputy director as SDNs under Executive Order 13818 (Global Magnitsky Sanctions) in response to their “actions to suppress peaceful, pro-democratic protests in Cuba.” The week before, OFAC sanctioned Cuba’s Minister of the Revolutionary Armed Forces and the Cuban Ministry of the Interior’s Special National Brigade, also under the Global Magnitsky program.
  4. The EU Council adopted a framework for imposing targeted sanctions — including asset freezes and travel bans — against persons found responsible for undermining democracy or the rule of law in Lebanon. According to a European Council news release, the measures are part of the EU’s efforts to encourage “Lebanese leadership [to] put aside their differences and work together to form a government” amid the current political and economic crisis.
  5. The US Department of Justice (DOJ) announced the seizure of the tanker M/T Courageous, whose owner (a Singapore national) stands accused of orchestrating sales of petroleum products to North Korea and laundering payments through the US financial system in violation of US and UN sanctions. The vessel was taken into custody in Cambodia in March 2020 after engaging in a ship-to-ship transfer with a sanctioned North Korean vessel.

Comments

It seems inevitable that some version of the PRC Anti-Foreign Sanction Law will make its way into Hong Kong law eventually. Last week’s reporting focused on the National People’s Congress’ authority to amend Annex III of Hong Kong’s Basic Law. However, that is not the only way. As reported by the South China Morning Post this week, Hong Kong’s Financial Secretary floated the idea of local legislation based on public consultation as another option.

As I told the Wall Street Journal, important questions about the proposal include which Hong Kong government agencies would be responsible for interpreting and enforcing such a law and the role of the Hong Kong courts. In any event, it’s not clear whether all provisions of the PRC law would (or should) be adopted in Hong Kong, or whether a different approach is warranted. And it may be too soon to do anything while so many details about the PRC version have yet to be worked out. (For more on the Anti-Foreign Sanction Law, see the Sanctions Top-5 for the week ending 11 June 2021.)

It’s also worth asking whether this development puts to rest the debate over Article 29(4) of Hong Kong’s National Security Law, which some commentators suggested could prohibit companies from complying with foreign sanctions. (Here’s a Sanctions Top-5 from July 2020 with more details.) But if that were true, there would be no need for a new law, right?

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