Sanctions

The UK's Office of Trade Sanctions Implementation (OTSI), within the Department for Business and Trade, opened last week. This new sanctions body has been established to strengthen the enforcement of trade sanctions and support businesses with compliance.. Complementing HMRC’s trade sanctions enforcement role at the UK border, OTSI has new civil enforcement powers in relation to services as well as movement of goods across third country borders, where there is a UK nexus.

Previously under sanctions due to its ties to Imperial Yachts, the 136 meter (446 ft) superyacht Flying Fox is likely to be free to operate globally without restrictions. …

The Commerce Department's Bureau of Industry and Security (BIS) published guidance for financial institutions containing best practice recommendations for complying with the Export Administration Regulations (EAR).  The guidance focuses on General Prohibition 10 (GP 10), which prohibits financial institutions (and other persons) from financing or otherwise servicing any item subject to the EAR with knowledge that a violation of EAR has occurred, is about to occur, or is intended to occur.

OFAC is amending the Reporting, Procedures and Penalties Regulations (RPPR). the May 2024 Interim Final Rule requiring reports witin 10 business days of when blocked property is unblocked or transferred, This final rule adds three exceptions to the reporting requirement for any blocked property that is unblocked or transferred.

The Department of Commerce’s Bureau of Industry and Security (BIS) published its second quarterly update of the boycott Requester List October 1st.  This list notifies companies, financial institutions, freight forwarders, individuals, and other U.S. persons of potential sources of certain boycott-related requests they may receive during the regular course of business. Of note, many recent reports come from customers outside the Arab world, including Japan, Brazil, Hong Kong, and the United Kingdom.   The greatest number of non-arab boycott requests originated in Bangladesh, Malaysia and Pakistan. 

BIS Chief Alan Estevez dismissed an appeal of a Temporary Denial Order issued in June against Russian national Alexey Sumchenko for his activities smuggling aircraft parts through Hong Kong to Russian airline customers.  Sumchenko argued that the alleged misconduct outlined in the TDO occurred after he relinquished ownership of the entities, reasoning Judge Tommy Cantrell found unpersuasive.

The G7 published joint guidance for industry on preventing evasion of the export controls and sanctions imposed on Russia. The guidance document contains items which pose a heightened risk of being diverted to Russia, updated red flag indicators of potential export control and/or sanctions evasion,  Best practices for industry to address these red flags, and screening tools and resources to assist with due diligence.

In a statement to mark the third anniversary of AUKUS, the leaders of Australia, the United Kingdom, and the United States, reaffirmed their commitment to this historic partnership and acknowledged progress to date.   

The Treasury Department has designated a network of five entities and one individual – based in Russia and in the Russia-occupied Georgian region of South Ossetia – that have enabled and supported ongoing efforts to establish illicit payment mechanisms between Russia and North Korea.

China announced steps against nine U.S. military-linked firms on Wednesday over U.S. weapons sales to Taiwan, freezing their property within China, in the latest move to put added pressure on the United States to halt its arms sales to the island, Reuters news service reported.

Today, the Department of the Treasury’s Office of Foreign Assets Control (OFAC) issued an update to the March 2019 OFAC Advisory to the Maritime Petroleum Shipping Community to highlight risks associated with shipments to Syria. Amendments to this advisory include updates to certain deceptive shipping practices and risk mitigation measures, along with an updated annex of vessels currently identified as blocked property on OFAC’s SDN List, that have been involved in fuel shipments to Syria.

The Georgia Institute of Technology announced it is shuttering its Shenzhen campus and closing a chapter of educational cooperation in the “China’s Silicon Valley” dating back to 1984. To date, Tianjin University remains on the Entity List, making Georgia Tech’s participation with Tianjin University, and subsequently GTSI, no longer tenable" the Iniversity said in a statement.

The US and allies announced a coordinated response to punish the government of Iran for supplying missiles to Moscow for use in Ukraine.  In a significant step, the allies promised sanctions against Iran Air, further crippling the Airbus-dependant state carrier. Existing sanctions have grounded much of the carrier's fleet of Airbus and ATR aircraft, with reports from last summer saying more than two-thirds were out of service.    The average age of the fleet exceeds 25 years.

On September 6, the U.S. Departments of State, Agriculture, Commerce, Homeland Security, and Treasury jointly released an updated warning for U.S. businesses about risks to their operations and activities in Hong Kong. Risk factors that were formerly limited to mainland China are now also a concern in Hong Kong and could affect commerce, trade, and seemingly routine individual commercial activities in Hong Kong. Many of these risks stem from the 2020 Law of the People’s Republic of China on Safeguarding National Security in the Hong Kong SAR (National Security Law, or NSL), as well as the Safeguarding National Security Ordinance (SNS Ordinance), which was enacted in March 2024 under Article 23 of Hong Kong’s Basic Law.

The Justice Department today announced the seizure of a Dassault Falcon 900EX aircraft owned and operated for the benefit of Nicolás Maduro Moros and persons affiliated with him in Venezuela. The aircraft was seized in the Dominican Republic and transferred to the Southern District of Florida at the request of the United States based on violations of U.S. export control and sanctions laws.

A Virginia  couple were indicted for sanctions violations and money laundering related to the Husband's work as a TV presenter and the wife's acting as an art & collectibles procurement agent for sanctioned Russian oligarch Aleksander Udoddov.

The Department of the Treasury's Office of Foreign Assets Control (OFAC) is issuing Russia-related General License 25E - "Authorizing Transactions Related to Telecommunications and Certain Internet-Based Communications," along with a related FAQ. Additionally, OFAC is publishing an alert, "Russian Attempts to Evade Sanctions Using New Overseas Branches and Subsidiaries," to warn foreign jurisdictions and financial institutions about Russia’s attempts to evade sanctions by opening new overseas branches and subsidiaries of Russian financial institutions.

Treasury’s Office of Foreign Assets Control (OFAC) designated 10 individuals and two entities as part of a coordinated U.S. government response to Moscow’s efforts to influence the 2024 U.S. presidential election. Beginning in early 2024, executives at RT—Russia’s state-funded news media outlet—began an ever more nefarious effort to covertly recruit unwitting American influencers in support of their malign influence campaign. RT used a front company to disguise its own involvement or the involvement of the Russian government in content meant to influence U.S. audiences. According to the Treasury statement, the Kremlin has increasingly adapted its efforts to hide its involvement by developing a vast ecosystem of Russian proxy websites, fake online personas, and front organizations that give the false appearance of being independent news sources unconnected to the Russian state.

The U.S. Agency for International Development (USAID) is considering updating its sanctions-related provisions and contract clauses for assistance and acquisition awards. A primary factor under review is whether to expand reporting requirements to enhance USAID's monitoring of recipients' and contractors' activities involving sanctioned jurisdictions or sanctioned individuals and entities subject to the sanctions programs administered by the U.S. Department of the Treasury's Office of Foreign Assets Control (OFAC).

Treasury's Office of Foreign Assets Control (OFAC) announced three new Frequently Asked Questions updates, one "basic information," clarifying First amendment protections, and two related to updated Cuban sanctions regulations.

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