On January 18, 2023, the US Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) issued an order identifying the virtual currency exchange Bitzlato Limited (Bitzlato) as a “primary money laundering concern” in connection with Russian illicit finance. The order, which is the first of its kind, was issued pursuant to Section 9714(a) of the Combating Russian Money Laundering Act.Continue Reading In Unprecedented Action FinCEN Identifies Virtual Currency Exchange as Primary Money Laundering Concern
On January 17, 2023, the US Department of Commerce’s Bureau of Industry and Security (BIS) issued an interim final rule (the “January 17 rule”), expanding its recent China-focused export controls, related to advanced computing and semiconductors, to Macau. These controls, initially imposed on China (including Hong Kong), were announced in an interim final rule on October 7, 2022 (the “October 7 rule”).Continue Reading BIS Extends Advanced Computing and Semiconductor Rules to Macau
On December 20, 2022, the US Department of the Treasury’s Office of Foreign Assets Control (OFAC) issued or amended general licenses (GLs) and FAQs to implement United Nations Security Council Resolution (UNSCR) 2664, which establishes humanitarian carveouts across UN sanctions regimes. The development of UNSCR 2664 was co-led by the United States and Ireland, and the Security Council adopted the Resolution on December 9, 2022. The amendments to OFAC’s regulations are set forth in OFAC’s Final Rule published in the Federal Register (see here and here).Continue Reading US Treasury Implements Humanitarian Authorizations Across Sanctions Programs to Comply with UN Resolution
On January 5, 2023, President Biden signed into law the Protecting American Intellectual Property Act of 2022 (the Act). The Act requires periodic reports to Congress identifying any “foreign persons” who are found to have engaged in significant theft of trade secrets of U.S. persons. The Act also requires menu-based sanctions against such persons, which may include blocking sanctions.
Although the Act does not specifically target any country, the press statement from Sen. Chris Van Hollen (D-Md.), the sponsor of the Act, clearly indicates that China is a primary intended target of the legislation.Continue Reading New Sanctions Authority for Theft of U.S. Trade Secrets by Foreign Persons
On December 16, FinCEN issued a notice of proposed rulemaking (NPRM) entitled “Beneficial Ownership Information Access and Safeguards, and Use of FinCEN Identifiers for Entities.” The NPRM is intended to implement the Corporate Transparency Act (CTA) and, in particular, to govern which entities may access corporate beneficial ownership information (BOI) that certain entities will soon be required to report to FinCEN under the CTA. Steptoe previously summarized FinCEN’s final rule on BOI reporting here.Continue Reading Proposed Rule Lays Out Who Will Have Access to New Corporate Beneficial Ownership Information
On December 15, 2022, The Russia (Sanctions) (EU Exit) (Amendment) (No. 17) Regulations 2022 (“Amendment 17”) were laid before parliament. Amendment 17 revises existing restrictions on dealing with securities, money market instruments, loans and credit to prohibit new investments in Russia via third countries. It also introduces a new prohibition on the provision of trust services to designated persons and persons connected with Russia, as well as expanding the existing ban on the provision of specified professional and business services to persons connected with Russia and making additions to the lists of items subject to existing trade sanctions. Finally, Amendment 17 suspends the Bank of England’s duty under the Banking Act 2009 to make a decision in respect of a notification of third-country resolution action in respect of a designated person, or entities owned or controlled by such a person. These measures came into effect on December 16, 2022.Continue Reading UK Introduces New Wave of Russia Financial and Trade Sanctions
The Department of Justice (DOJ) “KleptoCapture” Task Force (the “Task Force”), launched shortly after Russia’s invasion of Ukraine earlier this year, is characterized by DOJ as a key part of the current Administration’s broader anti-corruption initiative. The role of the Task Force is to support the enforcement of sanctions and export control restrictions imposed against Russia in response to the conflict. Earlier this month, Andrew Adams, the Task Force’s director, discussed its work to date, expected future developments, and implications for private sector companies. Highlights of his remarks are summarized below, along with our comments on key points addressed.Continue Reading Department of Justice KleptoCapture Task Force – Director Andrew Adams Shares Observations on Current Efforts and Expected Developments
On December 2, 2022, the G7, EU, and Australia (Price Cap Coalition) jointly agreed upon a cap on the price of seaborne Russian-origin crude oil at USD 60 per barrel as of December 5, 2022. The cap is subject to change based on the Coalition’s objectives and market fundamentals.
Upon reaching this consensus, the Treasury Department released a fact sheet on the same day providing additional details on the price cap policy, including its goals, how it works, and the compliance framework for the policy (the Fact Sheet). Most information has been previously discussed in the guidance released on November 22 (see our prior blog post at link). On December 5, the Treasury Department issued a Determination (the December Determination) pursuant to Executive Order 14071 and the prior Determination dated November 22 (the November Determination), to set the cap at USD 60 per barrel formally and to implement the policy.Continue Reading Price Cap Coalition Selects Level for Cap on Price of Seaborne Russian-Origin Crude Oil
On November 22, 2022, the US Department of the Treasury’s Office of Foreign Assets Control (OFAC) published a determination pursuant to Executive Order 14071 (EO 14071) (the Determination) and a guidance on the implementation of the price cap policy for Russian-origin crude oil (the Guidance). These followed OFAC’s preliminary guidance released on September 9 (see Steptoe’s earlier blog post here). The Determination sets forth the categories of services relating to the maritime transport of Russian-origin crude oil (Covered Services) that US persons are prohibited from providing directly or indirectly to a person located in Russia, unless the Russian crude oil is purchased at or below the price cap. The Guidance addresses issues relating to the implementation of the price cap policy for Russian-origin crude oil.Continue Reading OFAC Publishes Determination and Guidance on Implementing the Price Cap Policy for Russian Crude Oil
On November 21, 2022, the UK Department for Business, Energy and Industrial Strategy published guidance on the UK ban on Russian oil and oil products intended for entry into the UK (the “BEIS Guidance”) that was legislated for by the Russia (Sanctions) (EU Exit) (Amendment) (No. 14) Regulations 2022 and will come into effect on December 5, 2022. Among other things, the BEIS Guidance explains how to determine the origin of oil or oil product imports to the UK and sets out UK sanctions authorities’ expectations with respect to compliance controls in relation to the ban.Continue Reading UK Government Publishes Guidance on the UK Ban on Oil and Oil Products