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Financial Services Law Insights and Observations

OFAC sanctions additional persons for human rights violations in China’s Xinjiang region

Financial Crimes OFAC Department of Treasury Sanctions China Of Interest to Non-US Persons

Financial Crimes

On July 31, the U.S. Treasury Department’s Office of Foreign Assets Control announced sanctions pursuant to Executive Order 13818 against a Chinese government entity and two current or former government officials for alleged corruption violations of the Global Magnitsky Human Rights Accountability Act. According to OFAC, the sanctioned persons are connected to serious human rights abuse against ethnic monitories, including Uyghurs, in the Xinjiang region. Earlier in July, OFAC sanctioned another Chinese government entity and several current or former government officials for similar corruption violations (covered by InfoBytes here). As a result of the sanctions, all property and interests in property of the designated persons within U.S. jurisdiction must be blocked and reported to OFAC. OFAC notes that its regulations generally prohibit U.S. persons from participating in transactions with these individuals and entities, which includes “the making of any contribution or provision of funds, goods, or services by, to, or for the benefit of any blocked person or the receipt of any contribution or provision of funds, goods or services from any such person.”

Concurrent with the sanctions, OFAC also issued General License No. 2, which authorizes certain wind down and divestment transactions and activities related to blocked subsidiaries of the Chinese entity through September 30.

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