As the world turns… There have been several key developments recently in the Russia sanctions context:
- Issuance of General License 15. This general license, issued May 22, authorizes maintenance and winding down of pre-April 6 business with GAZ Group and its subsidiaries through October 23. The authorization is similar in scope to General License 14, issued on April 23 with respect to Rusal.
- Issuance of General License 13B. This general license, issued May 31, added EN+ Group PLC to the list of companies (previously consisting of GAZ Group and Rusal) for which divestment of holdings is permitted, and extended the deadline for divestment from June 6 to August 5. The general license also permits divestment of holdings in the subsidiaries of the covered companies under certain circumstances.
- Issuance of General License 16. This general license, issued just yesterday, authorizes certain activities to maintain or wind down pre-April 6 business with EN+ Group PLC, EuroSibEnergo, and their subsidiaries through October 23.
- Lapse of General License 12C. This general license previously had authorized certain activities to maintain or wind down pre-April 6 business with several Russian companies (see the list below). That authorization lapsed yesterday, meaning that business with the companies covered by the general license no longer is permitted.
- President Putin signs Russian “counter-sanctions” into law. Yesterday, President Putin signed into law a bill that gives him the power to sever relations with “unfriendly” countries and prohibit trade with such countries. Notably, the bill as initially proposed would have banned a range of US goods and services, including certain US food, alcohol, medicine, and consulting services, but it was watered down significantly before reaching the president’s desk. Consideration of a related bill, which would criminalize compliance with US sanctions on Russian soil, has been postponed for the time being.
So where do things stand? Here’s a short summary:
- Certain activity to maintain or wind down pre-April 6 business with Rusal, GAZ Group, EN+ Group PLC, EuroSibEnergo, and their subsidiaries is permitted through October 23. Note that General Licenses 14, 15, and 16 may vary in scope, and each should be assessed carefully.
- Certain activity to divest holdings in Rusal, GAZ Group, EN+ Group, and (under certain circumstances) their subsidiaries is permitted through August 5.
- Business with AgroHolding Kuban, Basic Element Ltd., B-Finance Ltd., Gazprom Burenie, Ladoga Menedzhment, NPV Engineering, Renova Group, and Russian Machines is no longer authorized pursuant to any OFAC general license as of today, June 5.
- Business with Rosoboroneksport, Russian Financial Corporation, and all of the individuals designated for sanctions on April 6— none of which were eligible for relief under the general licenses that OFAC has issued in recent weeks– remains off-limits.
- President Putin has signed certain counter-measures into law, and more may follow with respect to compliance with US sanctions on Russian soil.