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  • OFAC publishes new Ukraine-/Russia-related FAQs providing guidance on “maintenance” related to wind-down activities

    Financial Crimes

    On September 14, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced the publication of two new FAQs to provide additional guidance on “maintenance” as that term is used in General Licenses (GLs) 1415, and 16. As previously covered in InfoBytes (see posts here, here, and here), the GLs authorize specified wind-down activities otherwise prohibited by Ukraine-related sanctions regulations. According to OFAC, maintenance “generally includes all transactions and activities ordinarily incident to performing under a contract or agreement in effect prior to April 6, 2018, provided that the level of performance is consistent with the terms of the general license and consistent with past practices that existed between the party and the blocked entity prior to April 6, 2018.”

    Visit here for additional InfoBytes coverage on Ukraine/Russia-related sanctions.

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  • OFAC issues Ukraine-/Russia-related General License to extend expiration date

    Financial Crimes

    On July 31, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced that it was issuing Ukraine-/Russia-related General License 13C (GL 13C) to replace and supersede General License 13B (GL 13B) in its entirety, and to extend the expiration date through October 23, 2018. (See previous InfoBytes coverage on GL 13B, which was set to expire August 5, here.) GL 13C, which permits the same conduct as GL 13B, authorizes activities that would otherwise be prohibited by the Ukraine-Related Sanctions Regulations. Permissible activities include authorizing certain divestiture transactions with specified blocked persons to a non-U.S. person, and allowing the facilitation of transfers of debt, equity, or other holdings involving listed blocked persons, including entities owned 50 percent or more and issued by the named persons. In accordance with the issuance of GL 13C, OFAC issued updates to relevant FAQs.

    Visit here for additional InfoBytes coverage on Ukraine/Russian sanctions.

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  • OFAC issues Ukraine-/Russia-related General Licenses to extend expiration dates

    Financial Crimes

    On June 4, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) issued Ukraine-/Russia-related General License 16 (GL 16) authorizing specified wind-down activities, which would be otherwise prohibited by Ukraine-Related Sanctions Regulations. Permissible activities with the two designated, previously sanctioned companies (and any entity in which either of the two companies has a 50 percent or greater ownership interest, directly or indirectly) apply to operations, contracts, and agreements that were effective prior to April 6. GL 16 extends the wind-down period, which was originally set to expire June 5 under General License 12C (GL 12C), until October 23. (See previous InfoBytes coverage on GL 12C here.)

    Earlier on May 31, OFAC issued Ukraine-/Russia-related General License 13B (GL 13B) to replace and supersede General License 13A (GL 13A) in its entirety, and to extend the expiration date through 12:01 a.m. EDT August 5. (See previous InfoBytes coverage on GL 13A, which was set to expire June 6, here.) GL 13B permits the same conduct as GL 13A, including authorizing certain divestiture transactions with specified blocked persons to a non-U.S. person, and allowing the facilitation of transfers of debt, equity, or other holdings involving listed blocked persons, including entities owned 50 percent or more and issued by the named persons.

    Visit here for additional InfoBytes coverage on Ukraine/Russian sanctions.

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  • OFAC updates Ukraine-/Russia-related FAQs to address authorized wind-down activities permitted under certain general licenses

    Financial Crimes

    On May 25, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) published two additional FAQs to provide additional guidance on authorized wind-down activities outlined within General Licenses (GL) 12C, 14, and 15. (See previous InfoBytes coverage here concerning GL 14 and here for GL 12C and GL 15.) Specifically, the FAQs discuss conditions under which a U.S. person is authorized to receive scheduled principal and interest payments from identified blocked persons for a loan or bond in existence before the April 6 sanctions against Russian oligarchs or entities. The FAQs also address sanction implications for a foreign entity—that is itself not blocked—who pays dividends to a blocked person holding less than 50 percent equity interest.

    Visit here for additional InfoBytes coverage on Ukraine/Russian sanctions.

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  • OFAC issues new Ukraine-/Russia-related General Licenses authorizing additional wind-down activities

    Financial Crimes

    On May 22, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) issued Ukraine-/Russia-related General License 15 (GL 15) authorizing specified wind-down activities through October 23, which would be otherwise prohibited by Ukraine-Related Sanctions Regulations. Permissible activities with the designated company and its subsidiaries apply to operations, contracts, and agreements that were effective prior to April 6. OFAC further stated that, while funds blocked prior to May 22 remain blocked, GL 15 permits the use of these blocked funds for specified maintenance and wind-down activities.

    The same day, OFAC also issued Ukraine-/Russia-related General License 12C (GL 12C) to replace and supersede General License 12B (GL 12B) in its entirety. (See previous InfoBytes coverage on GL 12B here.) GL 12C, which incorporates exemptions permitted under GL 15, authorizes wind-down activities “originating and intermediary U.S. financial institutions to process funds transfers that they would otherwise block to an account held by a blocked U.S. person at a U.S. financial institution,” and allows the release of “such funds for authorized maintenance and wind-down purposes.” GL 12C is effective May 22.

    OFAC also released six new FAQs and published updated FAQs related to these general licenses.

    Visit here for additional InfoBytes coverage on Ukraine/Russian sanctions.

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  • OFAC issues new Ukraine-/Russia-related General Licenses and FAQs

    Financial Crimes

    On May 1, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) issued Ukraine-/Russia-related General License 12B (GL 12B) authorizing specified wind-down activities, which would be otherwise prohibited by Ukraine-related Sanctions Regulations, through June 5. According to a Treasury announcement, GL 12B—which replaces and supersedes General License 12A in its entirely—permits “originating and intermediary U.S. financial institutions to process funds transfers that they would otherwise block to an account held by a blocked U.S. person at a U.S. financial institution,” and allows the release of “such funds for authorized maintenance and wind-down purposes.”

    The same day, OFAC also issued Ukraine-/Russia-related General License 13A (GL 13A) to replace and supersede General License 13 (GL 13) in its entirety. (See previous InfoBytes coverage on GL 13 here.) GL 13A authorizes certain divestiture transactions with specified blocked persons to a non-U.S. person, and allows the facilitation of transfers of debt, equity, or other holdings involving listed blocked persons, including entities owned 50 percent or more and issued by the named persons. GL 13A is effective through June 6.

    OFAC also released three new FAQs and published updated FAQs related to these general licenses.

    Visit here for additional InfoBytes coverage on Ukraine/Russian sanctions.

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  • Treasury issues general license to extend wind-down period for sanctioned Russian aluminum producer

    Financial Crimes

    On April 23, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) issued General License 14 (GL 14) to extend the grace period for specified wind-down activities involving a Russian aluminum producer sanctioned earlier this month. As previously covered in InfoBytes here, the April 6 sanctions—issued pursuant to the Countering America’s Adversaries Through Sanctions Act of 2017—allowed U.S. persons until May 7 to wind down operations involving identified blocked persons. According to Treasury’s press release, GL 14’s new October 23 deadline provides Treasury time to consider the aluminum producer’s petition for delisting given the impact the April 6 sanctions have had on U.S. partners and allies. Additionally, Treasury stated that “OFAC will not impose secondary sanctions on non-U.S. persons for engaging in the same activity involving [the aluminum producer] or its subsidiaries that General License 14 authorizes U.S. persons to engage in.”

    The same day, OFAC also issued an amended General License 12A to reflect the authorization in GL 14, and released several new FAQs addressing authorizations and limitations under GL 14.

    Visit here for additional InfoBytes coverage on Ukraine/Russian sanctions.

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  • OFAC sanctions Russian oligarchs and government officials; releases new general licenses and updated FAQs

    Financial Crimes

    On April 6, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced its decision to sanction seven Russian oligarchs along with 12 companies they own or control, 17 senior Russian government officials, and a state-owned Russian weapons trading company and its Russian bank subsidiary, pursuant to the Countering America’s Adversaries Through Sanctions Act of 2017 (CAATSA) and Executive Orders 13661, 13662, and 13582. In a foreign policy statement released the same day, President Trump explained that the identified persons placed on the Specially Designated Nationals (SDNs) and Blocked Persons List engaged in actions that have reportedly contributed to “advancing Russia’s malign activities,” including (i) profiting from “Russia's destabilizing activities”; (ii) election meddling; (iii) undermining U.S. cybersecurity; (iv) engaging in weapons proliferation; (v) continuing to occupy Crimea; (vi) instigating violence in eastern Ukraine; and (vii) providing military equipment and support for the Government of Syria's continued attacks against Syrian citizens. Pursuant to OFAC’s sanctions, all property or interests in property of the designated persons along with any other entity owned 50 percent or more by one or more designated persons that is within U.S. jurisdiction are blocked, and U.S. persons are “generally prohibited” from participating in transactions with these individuals and entities. Additionally, “non-U.S. persons could face sanctions for knowingly facilitating significant transactions for or on behalf of the individuals or entities blocked today.”

    The same day, OFAC issued two Ukraine-/Russia-related general licenses to “minimize immediate disruptions to U.S. persons, partners, and allies.” General License 12 authorizes through June 5 certain activities necessary to “wind down” operations, contracts, or agreements in effect prior to April 6 involving specified blocked persons. General License 13 authorizes through May 7 divestiture transactions with certain blocked persons to a non-U.S. person, as well as the facilitation of transfers of debt, equity, or other holdings involving listed blocked persons by a non-U.S. person to another non-U.S. person. OFAC also released eight new FAQs related to this action and published one updated FAQ related to CAATSA.

    Visit here for additional InfoBytes coverage on Ukraine/Russian sanctions.

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  • OFAC further expands sanctions in connection with Ukrainian conflict

    Financial Crimes

    On January 26, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced its decision to sanction an additional 21 individuals and nine entities, pursuant to four executive orders (see Executive Orders 13660, 13661, 13662, and 13685), in connection with the United States’ support of Ukraine’s “sovereignty and territorial integrity” and opposition to Russia’s occupation of Crimea. Among other things, the financial sanctions target Russian government officials, Russian business executives, and Ukrainian separatist leaders involved with Russia’s occupation as part of efforts to hold responsible individuals accountable. Also sanctioned are nine technology, construction, and shipping firms supporting Russia’s occupation. As part of the announcement, Treasury Secretary Steven Mnuchin stated that “[t]he 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.” He further indicated that “[t]hose who provide goods, services, or material support to individuals and entities sanctioned by the United States for their activities in Ukraine are engaging in behavior that could expose them to U.S. sanctions.” All property, or interests in property, held by the sanctioned individuals and entities within U.S. jurisdiction will be blocked, and transactions between the sanctioned individuals and entities and Americans are also “generally prohibited.”

    Visit here for additional InfoBytes coverage on Russian and Ukrainian sanctions.

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  • OFAC Issues License and Guidance on Amended Ukrainian/Russian Sanctions

    Financial Crimes

    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. 

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