If you are a foreign company that wants access to the U.S. financial markets, make sure you understand the U.S. Iran Transactions and Sanctions Regulations (ITSR). Administered by the U.S. Department of Treasury’s Office of Foreign Assets Control (OFAC), the ITSR, unlike other sanctions programs, contain secondary sanctions that apply to non-U.S. persons for wholly non-U.S. conduct that may occur entirely outside U.S. jurisdiction. Even if you are not doing business with Iran, several companies and individuals, many of whom are not Iranian, have been listed under the sanctions program, including 25 more added earlier this month. (more…)
In the final weeks of December, President Obama amended sanctions to both the Iran and Russia programs. These changes further relaxed sanctions on Iran while they tightened sanctions on Russia (see our client advisory). Yet, just three days from the inauguration of President-elect Donald Trump, exporters are no doubt wondering what the new president will do with regard to these changes and other sanctions relief that has come to pass under the Obama administration. (more…)
Sanctions against Cuba continue to lift. Effective this week, the Department of Treasury’s Office of Foreign Assets Control (OFAC) and the Department of Commerce’s Bureau of Industry and Security (BIS) have relaxed controls in several areas of trade and commerce with Cuba, including loosening restrictions on exporting to and importing from Cuba, carving out new allowances for U.S. persons entering into contingent contracts with Cubans, and opening new opportunities for American entrepreneurs in the civil aviation, construction, and health sectors. Among the changes is also a provision that will allow Americans to travel to Cuba to attend professional meetings and conferences related to tourism. (more…)
Further weakening secondary sanctions, the Department of Treasury’s Office of Foreign Assets Control has issued a new license to allow non-U.S. persons to fly some U.S. aircraft to Iran for temporary sojourn. While General License J only applies to fixed-wing airplanes and imposes a number of conditions that must be met in order for non U.S.-persons to fly to Iran, the new license may mark the start of new opportunities for the civil aviation industry in Iran. (more…)
What are secondary sanctions?
Secondary sanctions apply to non-U.S. persons for wholly non-U.S. conduct that occurs entirely outside U.S. jurisdiction. Compare this to primary sanctions, which prohibit U.S. persons from engaging in specified activities with certain countries, entities, and persons. (more…)
The U.S. Department of Commerce’s Bureau of Industry and Security (BIS) has issued a voluntary disclosure guidance for export violations. The guidance takes effect July 22 and its intent is to make Commerce’s enforcement more in line with that of the Office of Foreign Assets Control (OFAC). Specifically, the new guidance introduces the OFAC concept of a “base penalty amount.” Like OFAC base penalties, the BIS base penalties will be determined by whether the violation was egregious and whether it was voluntarily disclosed. Once a base penalty amount is determined, the amount can move downward or upward based on mitigating and aggravating factors. (more…)
We all know that export regulations cannot keep up with reality. Reforms are happening very quickly, especially regarding Cuba. So, here’s a new procedure we just discovered. Perhaps it can help you if you are ever similarity situated.
On March 16, 2016, in what could be the final set of amendments to the Cuban Assets Control Regulations (CACR) under the Obama Administration, the Office of Foreign Assets Control (OFAC) published a Final Rule that further facilitates travel to Cuba, authorizes additional types of financial transactions, and allows companies to have a greater business presence on the island. As expected, Wednesday’s changes represent yet another small step towards normalization that builds upon past rounds of regulatory amendments implemented on January 16, June 15, and September 21, 2015, and January 27, 2016. (more…)
A year ago I posted an overview of OFAC’s Ukraine and Russia-related sanctions program, located here. Although the Executive Orders and program structure described in that post have not been changed or expanded, it is important to remember that (1) the existing prohibitions remain in place until further notice and (2) individuals and entities are added and removed from OFAC’s SDN and SSI lists on a regular basis. This means that if you are doing business with companies that may be located in or may have ties to Ukraine, Crimea, or Russia, you have an ongoing responsibility to ensure that you are not transacting with a prohibited party or exporting to Crimea in violation of OFAC’s regulations or associated State and Commerce policies. (more…)
In December of 2015 the Department of the Treasury’s Office of Foreign Assets Control (“OFAC”) issued regulations implementing the President’s April 1, 2015 Executive Order (“EO”), “Blocking the Property of Certain Persons Engaging in Significant Malicious Cyber-Enabled Activities.” The buzz around the water cooler is that many business are worried about the implications of these regulations on their everyday business and cyber security activities like network defense and the use of encryption. Fear not, OFAC is not coming after your IT department. These regulations are not meant to deter companies or individuals from protecting themselves or their data, but to identify, isolate, and cripple foreign cyber terrorists and those that pose a threat to national security, foreign policy, or the health of the U.S. economy. (more…)