Today the U.S. State Department published updated guidance indicating that significant transactions related to Nord Stream 2 and the second line of TukStream may be subject to U.S. secondary sanctions penalties under Section 232 of CAATSA.
Section 232 authorizes the U.S. government to impose a bevy of sanctions on non-U.S. parties that make investments in
Today the Office of Foreign Assets Control (OFAC) announced a settlement agreement with Amazon for apparent violations of U.S. sanctions regulations by the company. The announcement puts e-commerce and online companies on notice to increase their vigilance when it comes to sanctions screening.
According to OFAC, Amazon violated U.S. regulations by conducting retail e-commerce transactions
Today the Bureau of Industry and Security (BIS) announced that it is suspending license exceptions for exports, re-exports, or transfers to or within Hong Kong that provide differential treatment than license exceptions available for shipments to mainland China. In other words, if a license exception is not available for shipments to China, then it can
Elliott Abrams, the U.S. Special Representative for Venezuela, announced a plan to lift sanctions on Venezuela should the Maduro regime step aside to permit a transitional government to be elected until full elections can take place in late 2020.[1] If there is transition of power, individual sanctions on dozens of Venezuelan government officials could
Today the president signed a new Executive Order (E.O.) announcing expanded primary and secondary sanctions on Iran, focused on the construction, mining, manufacturing, and textile industries. OFAC also sanctioned a significant segment of the Iranian metals industry today, targeting the largest iron, steel, aluminum, and copper producers in Iran under an existing sanctions authority focused
After an announcement from the President today, OFAC removed the Turkish Ministry of Energy and Natural Resources, the Ministry of National Defense, and the ministers of Defense, Energy and Natural Resources, and Interior from the SDN List. The move effectively lifts the sanctions imposed on Turkey two weeks ago for its incursion into Syria.
Companies
Yesterday, the Office of Foreign Assets Control (OFAC) issued General License No. 8D, authorizing U.S. persons to engage in transactions and activities involving Petroleos de Venezuela, S.A. (PdVSA) that are ordinarily incident and necessary to the maintenance of operations, contracts, and other agreements involving Chevron, Halliburton, Schlumberger Limited, Baker Hughes, and Weatherford International in
Today, the U.S. Bureau of Industry and Security (BIS) amended the Export Administration Regulations (EAR) to further tighten restrictions on Cuba. The changes, which are effective immediately, are part of a broader U.S. government effort to tighten the embargo on Cuba after a tentative easing of relations under the Obama Administration.
The amendment lowers the applicable de minimis threshold for non-U.S. items that contain U.S.-origin content; tightens rules regarding the leasing or chartering of aircraft or vessels; and limits license exception Support for the Cuban People (SCP), including by clarifying the scope of authorized telecommunications exports and reexports.
10 percent de minimis threshold
First, and most importantly for non-U.S. companies, BIS lowered the de minimis threshold for Cuba from 25 percent to 10 percent. During the Obama Administration, the de minimis level for Cuba was raised from 10 percent to 25 percent. This amendment reverses that change.
The amendment means that non-U.S. companies must now obtain a BIS license or use an EAR license exception before exporting any product (including goods, software, or technology) to Cuba if the product contains more 10 percent U.S.-origin content, by value. According to BIS, such license applications will face a presumption of denial unless the project supports U.S. policy, defined in Section 742.2(b) of the EAR. Non-U.S. companies should review pending and planned projects in Cuba to ensure compliance with the new rules. There is no grace or wind down period associated with the change.
The EAR’s de minimis provisions are an example of the extraterritorial application of U.S. export control laws – non-U.S. items located outside of the United States are subject to the EAR’s license requirements if the items contain more than a de minimis level of controlled U.S.-origin content.
Aircraft & vessel restrictions
Second, BIS is rescinding a favorable a licensing policy regarding the export or reexport of aircraft leased to Cuban state-owned airlines and is revoking licenses issued under the prior licensing policy within seven days. License requests related to such exports and reexports will now face a presumption of denial. The amendment also tightens the restrictions in license exception Aircraft, Vessels, and Space (AVS) when applied to aircraft or vessels leased to or chartered by a Cuban national or a state sponsor of terrorism.
New limits on license exception Support for the Cuban People
Finally, the amendment narrows license exception SCP with respect to certain donated items, clarifies the scope of the authorized telecommunications exports, and limits exports on
Continue Reading BIS tightens Cuba restrictions, lowers de minimis threshold to 10 percent
Yesterday, the U.S. government issued an Executive Order (E.O.) imposing new primary and secondary sanctions that target the government of Turkey in response to the escalating conflict in northern Syria. Pursuant to the new sanctions, the Office of Foreign Assets Control (OFAC) also added the Turkish Ministry of Energy and Natural Resources, the Turkish Ministry of National Defense, and the Turkish ministers of Defense, Energy and Natural Resources, and Interior to the SDN List, formally blocking (freezing) those parties’ property and interests in property, subject to U.S. jurisdiction. Entities owned 50 percent or more, directly or indirectly, by these SDNs are also subject to blocking sanctions pursuant to OFAC’s “50 percent rule.”
While the sanctions are currently narrowly targeted, the E.O. authorizes a broad array of future possible sanctions against other parties connected to the Turkish government and companies operating in Turkey. Whether and to what extent sanctions are expanded on Turkey will depend on developments on the ground in Syria and U.S. domestic politics. Various groups, including prominent voices in Congress, are pushing the administration for more aggressive action against Turkey, which could portend an expansion of sanctions against the Ankara government.
Blocking sanctions
The October 14, 2019 E.O. authorizes the U.S. government to block any person (e.g., designate that person as a Specially Designated National (SDN)) that the Secretary of the Treasury determines to:
Continue Reading U.S. Issues New Primary and Secondary Sanctions Targeting Turkey
Today the U.S. Office of Foreign Assets Control (OFAC) amended the Iranian Transactions and Sanctions Regulations (ITSR, 31 C.F.R. Part 560) to fully re-impose U.S. sanctions on Iran following a wind down period that expired yesterday, November 4, 2018. OFAC also issued new FAQs for foreign affiliates of U.S. companies and non-U.S. companies.
Foreign
