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OFAC sanctions target North Korea’s shipping and trading industry
On February 23, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) imposed additional sanctions targeting the North Korean shipping and trading industry. The sanctions include the designation of 27 entities, 28 vessels, and one individual consistent with the Countering America’s Adversaries Through Sanctions Act of 2017. Treasury Secretary Steven T. Mnuchin stated, “Treasury is aggressively targeting all illicit avenues used by North Korea to evade sanctions, including taking decisive action to block the vessels, shipping companies, and entities across the globe that work on North Korea’s behalf. This will significantly hinder the Kim regime’s capacity to conduct evasive maritime activities that facilitate illicit coal and fuel transports, and erode its abilities to ship goods through international waters.” All property or interests in property held by the sanctioned individual and entities within U.S. jurisdiction must be blocked, and transactions between the designated persons and Americans are also prohibited.
Separately, OCAC issued a global shipping advisory in conjunction with the U.S. Department of State and the U.S. Coast Guard to, among other things, (i) outline methods employed by North Korea to facilitate illicit transactions to evade sanctions; (ii) list due diligence steps companies should employ to monitor illicit North Korean activity and mitigate the risk of potentially engaging in prohibited activity or transactions; and (iii) provide an overview of penalties associated with violating U.S. or UN sanctions.
See here for previous InfoBytes coverage on North Korean sanctions.
Treasury releases list of Russian senior foreign political figures and oligarchs, does not impose new sanctions
On January 29, the U.S. Treasury Department released an unclassified report to Congress containing a list of 210 individuals who are either senior foreign political figures in the Russian Federation or Russian oligarchs with a net worth of at least $1 billion. Treasury emphasized that the report—which was mandated through Section 241 of the Countering America’s Adversaries Through Sanctions Act of 2017 (CAATSA)— (i) is not a sanctions list; (ii) should not be interpreted as a determination that individuals or entities included in the report or listed within classified appendices or annexes meet the criteria for sanctions designation (individuals and entities subject to separate sanctions are denoted within the report); and (iii) does not serve to indicate that the U.S. Government possesses information about an “individual’s involvement in malign activities.” Classified lists that may include officials and oligarchs of lesser rank and wealth will be submitted as well. Additionally, Treasury submitted to Congress a required classified annex to the report, which lists Russian parastatals entities that are defined as “companies in which state ownership is at least 25 percent and that had 2016 revenues of approximately $2 billion or more.” The annex also presents an analysis of potential impact on the U.S. economy that may result should additional debt and equity restrictions or sanctions be imposed on the identified entities.
Separately, on January 30, Treasury released updated FAQs to address questions related to the report’s release.
See here for additional CAATSA InfoBytes coverage.
OFAC Issues License and Guidance on Amended Ukrainian/Russian Sanctions
On November 28, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) released General License 1B to address amendments made to Directives 1 and 2 (Directives) of its Ukrainian/Russian-related Sectoral Sanctions. The amendments were made in accordance with the Countering America’s Adversaries Through Sanctions Act of 2017 (CAATSA). (See previous InfoBytes coverage on Directives here.) The Directives prohibit U.S. persons from dealings in certain equity and debt of persons determined by OFAC to be part of the Russian financial and energy sectors. According to a Treasury press release, General License 1B addresses the decrease in the maturity dates of debt transactions prohibited by Directive 1 from 30 days to 14 days, and the decrease in the maturity dates of debt transactions prohibited by Directive 2 from 90 days to 60 days. General License 1B authorizes transactions by U.S. persons, wherever located, and transactions within the United States that involve derivative products whose value is linked to an underlying asset that constitutes prohibited debt issued by person subject to Directives 1, 2 or 3 of the Sectoral Sanctions, including those issued on or after November 28 that have the reduced maturity dates targeted by CAATSA. OFAC also released updated FAQs to answer questions related to the Ukrainian-/Russian-related amended directives.
OFAC Sanctions North Korean Officials, Amends Global Terrorism Sanctions Regulations
On October 26, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced sanctions on an additional seven individuals (pursuant to Executive Order 13687) and three entities (pursuant to Executive Order 13722) connected to the North Korean government for ongoing human rights abuses. According to Treasury Secretary Steven T. Mnuchin, the sanctions target “financial facilitators who attempt to keep the regime afloat with foreign currency earned through forced labor operations.” The sanctions freeze all property or interests in property within U.S. jurisdiction, and transactions by U.S. persons involving these individuals and entities are also “generally prohibited.” Please see here for previous InfoBytes coverage on North Korean sanctions.
Separately, on October 30, OFAC released amendments to its Global Terrorism Sanctions Regulations to include recently identified officials, agents, and affiliates connected to Iran’s Islamic Revolutionary Guard Corps. The amendments take effect upon publication in the Federal Register on October 31 and are issued pursuant to the Countering America's Adversaries Through Sanctions Act of 2017 (CAATSA). See previous InfoBytes coverage on CAATSA here.
OFAC Amends Sanctions on Russia’s Financial and Energy Sectors
On September 29, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) amended Directive 1 and Directive 2 of its Ukrainian-/Russian-related Sectoral Sanctions, as required by the Countering America’s Adversaries Through Sanctions Act of 2017 (H.R. 3364), which was signed into law by President Trump in August. (See previous InfoBytes summary here.) As amended, Directive 1 prohibits U.S. persons from all dealings in equity issued on or after July 16, 2014, of persons determined by OFAC to be part of the Russian financial services sector. Directive 1 also prohibits U.S. persons from dealing in the following debt of such persons: (i) debt of over 90 days maturity issued on or after July 16, 2014, but prior to September 12, 2014; (ii) debt of over 30 days maturity issued on or after September 12, 2014, but before November 28, 2017; and (iii) debt of over 14 days maturity issued on or after November 28, 2017. As amended, Directive 2 prohibits U.S. persons from all dealings in the following debt of persons identified by OFAC to be part of the Russian energy sector: (i) all debt of over 90 days maturity issued on or after July 16, , but before November 28, 2017; and (ii) all debt of over 60 days maturity issued on or after November 28, 2017. OFAC also released updated FAQs to answer questions related to the amended directives.