OFAC Amends the Iranian Transactions and Sanctions Regulations

On Thursday, June 28 the U.S. Department of the Treasury, Office of Foreign Assets Control (OFAC) amended (1) the Iranian Transactions and Sanctions Regulations (2) in order to implement the President's May 8, 2018 decision (3) to end U.S. participation in the Joint Comprehensive Plan of Action (JCPOA).  The changes include, but are not limited to:

• Amending the general licenses authorizing the importation into the US (4) of and dealings in, Iranian-origin carpets and foodstuffs, as well as related letters of credit and brokering services, to narrow the scope of the licenses and to allow for the wind down of these activities through August 6, 2018;
• Adding a new general license to authorize the wind down, through August 6, 2018, of transactions related to the negotiation of contingent contracts for activities, previously approved under General License I (5), related to the export or re-export to Iran of commercial passenger aircraft and related parts and services; and 
• Adding a new general license (6) to authorize the wind down, through November 4, 2018 of certain transactions, previously approved under General License H (7), related to foreign entities owned or controlled by a US Person (8).
  • Non-US entities that are owned or controlled by a US Person are still subject to the restrictions on US Person involvement during the wind down period (9).  

For more information contact your GCSG experts.

E  info@globalcompliancesg.com

References:

• (1) Federal Register / Vol. 83, No. 125 / Thursday, June 28, 2018 pp. 30335-30338 - Iranian Transactions and Sanctions - Final Rule
• (2) 31 CFR 560 - Iranian Transactions and Sanctions Regulations
• (3) Presidential Memoranda - "Ceasing US Participation in the JCPOA and Taking Additional Action to Counter Iran's Malign Influence and Deny Iran All Paths to a Nuclear Weapon" - 5/8/18
• (4) 31 CFR 560.534 and 560.535
• (5) General License I
• (6) 31 CFR 560.537
• (7) General License H
• (8) US Person - "the term United States person or US person means any United States citizen, permanent resident alien, entity organized under the laws of the United States or any jurisdiction within the United States (including foreign branches), or any person in the United States." 31 CFR 560.314. 
• (9) "Guidance on the provision of certain services relating to the requirements of US sanctions laws" - 1/12/17
• FAQ - "Regarding the Re-Imposition of Sanctions Pursuant to the May 8, 2018 National Security Presidential Memorandum Relating to the JCPOA" - 5/8/18; updated 6/27/18
• Office of Foreign Assets Control
• US Department of the Treasury
• US Department of State
• US Department of State - Press Release "Senior State Department Official On U.S. Efforts to Discuss the Re-imposition of Sanctions on Iran With Partners Around the World" - June 26, 2018

U.S. Sanctions Additional Russian Entities

On Friday, January 26, 2018, the U.S. Department of the Treasury's Office of Foreign Assets Control (OFAC) sanctioned an additional nine entities, and 21 individuals related to Russia and Ukraine.  In addition, OFAC identified 12 subsidiaries that are 50% or more owned by previously sanctioned Russian companies.  

The action is related to Russia's occupation of Crimea and is intended to pressure Russia to fully implement its commitments under the Minsk agreements.  U.S. Persons (1, 2) are generally prohibited from conducting transactions involving these persons (2).

"The U.S. government is committed to maintaining the sovereignty and territorial integrity of Ukraine and to targeting those who attempt to undermine the Minsk agreements," - Secretary of the Treasury Steven T. Mnuchin (3)

Summary of OFAC Actions Taken

• Designated 11 Ukrainian separatists - Pursuant to Executive Order (EO) 13660
• Designated 3 individuals and 4 entities (ZAO Vneshtorgservis, Gaz-Alyans OOO, Doncoaltrade Sp. ZOO and Ugolnye Tekhnologii OOO) who have supported the illicit coal trade - Pursuant to EO 13660
• Authorized sanctions against 4 individuals and 2 entities (Evro Polis Ltd., Instar Logistics) related to the Russian government - Pursuant to EO 13661
• Authorized sanctions against one construction entity (VAD, AO) and two associated individuals - Pursuant to EO 13685
• Designated one individual and 2 entities (Limited Liability Company Foreign Economic Association Technopromexport, PJSC Power Machines) related to Russia's transfer of four turbines to Crimea
• Identified 12 subsidiaries of Surgutneftegaz as being 50% or more owned by Surgutneftegaz which was added to the Sectoral Sanctions Identification list in September 2014
  • Kaliningradnefteprodukt OOO
  • Kinef OOO
  • Kirishiavtoservis OOO
  • Lengiproneftekhim OOO
  • Media-Invest OOO
  • Novgorodnefteprodukt OOO
  • Pskovnefteprodukt OOO
  • Sngb AO
  • SO Tvernefteprodukt OOO
  • Sovkhoz Chervishevski PAO
  • Strakhovove Obshchestvo Surgutneftegaz OOO
  • Surgutmebel OOO

References and Key Link(s):

• (1) 31 CFR 589.307 - "The term person means an individual or entity." 
• (2) 31 CFR 589.312 - "The term United States person or U.S. person means any United States citizen, permanent resident alien, entity organized under the laws of the United States or any jurisdiction within the United States (including foreign branches), or any person in the United States.
• (3) U.S. Department of the Treasury Press Release - "Treasury Sanctions Additional Individuals and Entities in Connection with the Conflict in Ukraine and Russia's Occupation of Crimea" - 1/26/2018
• Executive Order 13660 - 3/6/2014
• Executive Order 13661 - 3/16/2014
• Executive Order 13685 - 12/19/2014
• Minsk Agreement Protocol Press Release (Russian) - "Organization for Security and Co-operation in Europe" - 9/5/2014 
• OFAC - Office of Foreign Assets Control
• OFAC Resource Center - Russia/Ukraine-related Designations and Identifications - 1/26/2018
• US Department of the Treasury

Monday Compliance News - Around the World

GCSG's Monday Compliance News is a compilation of some of the previous weeks interesting compliance news bites, from around the world, that we deliver every Monday morning. 

Identity Fraud Cases Skyrocket in Netherlands - NLTimes.nl

"The number of reports about identity fraud in the Netherlands more than doubled last year, according to figures from the Identity Fraud Hotline." (Click here for the article) - Netherlands

How hackers made off with millions - Thomson Reuters

"It's been a little over a year since the New York Federal Reserve and the SWIFT international transaction system were breached in a cyber-attack that resulted in $81 million stolen from a Bangladesh central bank account - one of the biggest known bank thefts in history" (Click here for the article) - USA, Bangladesh

Report Faults Wells Fargo's Law Department in Sham-Accounts Scandal - Law.com

"The report, released Monday, was commissioned by Wells Fargo last year after the bank agreed to pay $185 million to settle accusations that employees opened as many as 2.2 million unauthorized accounts by transferring funds without customers consent from existing accounts." (Click here for the article) - USA

The money machine: how a high-profile corruption investigation fell apart - Guardian News and Media Limited or its affiliated companies

"The 2014 summit - much like David Cameron's highly publicized global Anti-Corruption Summit in 2016 - was intended to show Britain's determination to live up to its responsibilities.  Instead, the case of the $23m collapsed within a year - when a British judge ruled that the SFO had built its case on 'conjecture and suspicion', and ordered the money returned to its owner." (Click here for the article) - Britain, Ukraine

North Korea oil imports, airline among possible US sanctions targets - Thomson Reuters

"...the Trump administration is focusing its North Korea strategy on tougher economic sanctions, possibly including an oil embargo, banning its airline, intercepting cargo ships and punishing Chinese banks doing business with Pyongyang..." (Click here for the article) - USA, North Korea, China

How one of the world's biggest oil firms secured a $1.3 billion deal mired in corruption allegations - BuzzFeed

"On the evening of 17 February 2016...the chief executive of oil giant Shell, picked up his phone...The topic of their conversation: a 'dawn raid' on the company's headquarters earlier that day by Dutch police investigating a controversial $1.3 billion Nigerian oil deal struck five years previously." (Click here for the article) - Netherlands, Italy, Nigeria

Trump considers trade order that could lead to duties - CNBC

"U.S. President Donald Trump is considering an executive order to launch a trade investigation that could lead to supplemental duties in certain product categories..." (Click here for the article) - USA

EU Updates Restrictive Measures Concerning Iran, North Korea & Central African Republic

Council Implementing Regulation (EU) 2016/603 of 18 April 2016 implementing Regulation (EU) No 267/2012 concerning restrictive measures against Iran

Council Decision (CFSP) 2016/609 of 18 April 2016 amending Decision 2010/413/CFSP concerning restrictive measures against Iran

Council Regulation (EU) 2016/555 of 11 April 2016 amending Regulation (EU) No 224/2014 concerning restrictive measures in view of the situation in the Central African Republic

Council Implementing Regulation (EU) 2016/556 of 11 April 2016 implementing Regulation (EU) No 359/2011 concerning restrictive measures directed against certain persons, entities and bodies in view of the situation in Iran

Commission Implementing Regulation (EU) 2016/569 of 12 April 2016 amending Council Regulation (EC) No 329/2007 concerning restrictive measures against the Democratic People's Republic of Korea

Council Decision (CFSP) 2016/564 of 11 April 2016 amending Decision 2013/798/CFSP concerning restrictive measures against the Central African Republic

Council Decision (CFSP) 2016/565 of 11 April 2016 amending Decision 2011/235/CFSP concerning restrictive measures directed against certain persons and entities in view of the situation in Iran

Council Implementing Decision (CFSP) 2016/573 of 12 April 2016 implementing Decision 2013/183/CFSP concerning restrictive measures against the Democratic People's Republic of Korea