The US Department of the Treasury (“Treasury”) published two proposed rules on September 24, 2019 that would significantly expand the jurisdiction of the Committee on Foreign Investment in the United States (“CFIUS”) to review inbound U.S. foreign investment for national security risks. The proposed rules, which have been in the works for months, would implement
Today the Treasury Department’s Office of Foreign Assets Control (“OFAC”) issued new restrictions on remittances and “U-turn” transactions to Cuba, which will come into effect on October 9, 2019. These restrictions are intended to further implement President Trump’s June 2017 National Security Presidential Memorandum, in which he outlined US policy toward Cuba under his administration and various policy actions to be taken by a number of agencies and departments.
These new restrictions build upon those announced on June 4, 2019, in which the US government prohibited US travelers from going to Cuba under the previous ‘group people-to-people educational’ travel authorization and further restricted travel by no longer permitting visits to Cuba via passenger and recreational vessels, including cruise ships and yachts, and private and corporate aircraft.
In addition to amending the Cuban Assets Control Regulations, OFAC issued 46 updated or new FAQs on Cuba. Although many of the changes were either cosmetic or to provide the relevant regulatory citations, some are worth noting. In particular, FAQs 1, 40, 44, and 65 provide guidance on today’s amendments. Additionally, FAQ 12 provides guidance on OFAC’s June 5 amendments related to “people-to-people travel.”
The amendments to OFAC regulations on remittances and U-turn transactions to Cuba represent the reinstatement of certain restrictions that were eased under the Obama administration as we described in our 2016 advisory.
Continue Reading Treasury tightens remittances to Cuba and prohibits “U-turn” transactions
On September 5, OFAC issued regulations to implement Executive Order (EO) 13851 related to the situation in Nicaragua. Signed on November 27, 2018, EO 13851 blocks the property of persons who served as Nicaraguan government officials at any time on or after January 10, 2007, persons who are responsible or complicit in serious human rights abuses, undermining democracy, threatening peace and security, or corruption and expropriation. It also blocks leaders or officials of entities that have engaged in such practices, as well as entities owned by persons blocked by the EO.
EO 13851 does not restrict general exports or imports involving Nicaragua. Rather it is targeted at prohibiting US persons from engaging in transactions with designated persons and entities, and any undesignated entities that are owned 50 percent or more by one or more designated entities or persons.
The order also authorizes the US government to block the property of any persons, including non-U.S. persons, that materially assist, or provide financial, material, or technological support for, or goods or services in support of, persons and entities blocked by the order, as well as persons that provide support for human rights abuses, threats to peace and security, corruption and other activities described in the order.
Continue Reading OFAC Issues regulations implementing Nicaragua sanctions
On August 5, President Trump issued executive order (EO) 13884 expanding sanctions in Venezuela by blocking the property of the Government of Venezuela as a whole. In connection with this step, OFAC issued 12 amended and 13 new general licenses and published interpretive guidance pertaining to the provision of humanitarian assistance and support for the Venezuelan people. According to an OFAC press release, the new EO and general licenses “allow U.S. persons to continue to provide humanitarian support to the Venezuelan people” while putting pressure on the Maduro regime.
Continue Reading New Round of Sanctions Block Government of Venezuela, Issue General Licenses
On May 1, OFAC issued two amended general licenses under the Ukraine-Related Sanctions Regulations (URSR). General License No. 12B, superseding General License No. 12A, authorizes additional activities necessary to the maintenance and winding down of operations or existing contracts. General License No. 13A, superseding General License No. 13, authorizes certain additional transactions necessary to divest from certain blocked persons. OFAC also issued three new FAQs (583-585) and revised four others (570, 571, 578, and 582).
Under General License No. 12B, funds of identified blocked persons may be used for maintenance or wind-down activities, and US financial institutions are now permitted to process funds related to these maintenance/wind-down activities.
Under General License No. 13A, US persons now have until June 6, 2018 to divest from holdings covered by the license. This is one month longer than the previous May 7, 2018 deadline. US persons may also take actions to divest from entities meeting the following criteria: (a) they are owned (50 percent or more) by EN+ Group plc, GAZ Group, and United Company Rusal and (b) their holdings were issued by Irkutskenergo, GAZ Auto Plant, or Rusal Capital Designated Activity Company.
Continue Reading OFAC Eases Maintenance/Wind-Down and Divestment Restrictions in New General Licenses