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In this blog post, we update our earlier post regarding OFAC’s determination and guidance on implementing the price cap policy for Russian crude oil (see link), by incorporating the recently released determinations regarding the price cap policy for Russian petroleum products and the updated guidance on implementing the price cap policy for Russian-origin crude oil and petroleum products.

On November 22, 2022, the US Department of the Treasury’s Office of Foreign Assets Control (OFAC) published a determination targeting Russian-origin crude oil pursuant to section 1(a)(ii) of Executive Order 14071 (EO 14071), and guidance on the implementation of the price cap policy for Russian-origin crude oil. These followed OFAC’s preliminary guidance released on September 9 (see Steptoe’s earlier blog post here).

Further, on February 3, 2023, OFAC published a determination targeting Russian-origin petroleum products pursuant to section 1(a)(ii) of EO 14071, and updated guidance on the implementation of the price cap policy for Russian-origin crude oil and petroleum products (the Updated Guidance).

The two determinations (the Determinations) set forth the categories of services relating to the maritime transport of Russian-origin crude oil and petroleum products (Covered Services) that US persons are prohibited from providing directly or indirectly to a person located in Russia, unless these items are purchased at or below relevant price cap. The Updated Guidance addresses issues relating to the implementation of the price cap policy for Russian-origin crude oil and petroleum products.…

Continue Reading [UPDATED] OFAC Publishes Determinations and Guidance on Implementing the Price Cap Policy for Russian Crude Oil and Petroleum Products

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.[1]…

Continue Reading New Sanctions Authority for Theft of U.S. Trade Secrets by Foreign Persons

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

This year, we have witnessed an extraordinary set of coordinated economic sanctions and export control regulatory actions against Russia after its invasion of Ukraine. In contrast to the fast and furious pace of regulatory action, enforcement actions did not keep pace.

This year’s enforcement actions by the US Treasury Department’s Office of Foreign Assets Control (OFAC) are notable for their jurisdictional reach and expansion of liability theories that aren’t necessarily supported by the plain language of their regulatory authority. The Commerce Department’s Bureau of Industry & Security (BIS) enforcement actions have targeted the aerospace industry, especially in relation to Russia and Belarus. The Department of Justice (DOJ) expended much of its resources on seizing and forfeiting assets linked to Russian oligarchs, galvanizing its multilateral networks.

Interestingly, OFAC continued to target the Iranian petroleum and petrochemical sector despite news reports of intensive negotiations to revive the Joint Comprehensive Plan of Action (JCPOA).

Below we discuss some representative enforcement actions to date.…

Continue Reading What to Expect Next? US Economic Sanctions and Export Controls Enforcement Actions Thus Far in 2022

On December 29, 2021, the PRC State Council’s Information Office (the Information Office) published a white paper on export controls, providing a comprehensive picture of China’s current legal and regulatory regime for export controls and potential future changes in export control governance. The document is China’s first white paper on export controls and comes approximately one year after the implementation of the PRC Export Control Law in December 2020.

On the same day, the PRC Ministry of Commerce (MOFCOM), which plays a central role in administering China’s export control regime for non-military items, issued a statement giving more information about the White Paper, while an unnamed MOFCOM official gave an interview to Chinese state-owned media discussing the White Paper in the context of PRC government policy with respect to multilateral export controls as well as China’s national security and development interests.…

Continue Reading China’s First White Paper on Export Controls Summarizes Legal Developments, Opposes “Abuse” of Export Controls