The European Commission (the Commission) recently issued draft guidelines on the core elements that European industry should take into account when implementing internal export controls and sanctions compliance programs.  The guidance – which is legally non-binding – will be finalized upon the results of a public consultation providing the opportunity for EU exporters to comment on its core elements.  Companies can participate by responding to a survey until November 15.  It is the intention of the Commission to share the results of this survey with a Technical Expert Group before finalizing its guidance.

Internal compliance programs (ICPs) have long been part of a culture of compliance in the US, but much less so within the European Union.  However, ICPs are increasingly viewed in the EU as a key element for an effective export control system.  While not expressly alluding to ICPs, the EU Dual Use Regulation has encouraged Member States to take into consideration whether a company employs adequate means and procedures for compliance when assessing applications for global export authorizations.  In addition, ICP guidelines have been introduced by some Member States as a tool to better monitor compliance with EU and national export controls.  The EU Dual Use Regulation Recast Proposal formally introduces standardized operational ICPs as part of the assessment in the granting and control of global export authorizations and certain general export authorizations.  In implementing these ICP guidelines, the EU is acting pursuant to the multilateral provisions of the Wassenaar Arrangement that have expressed support for ICPs and for this type of regulatory guidance.
Continue Reading EU Promotes Export Controls and Sanctions Compliance Programs

In response to President Trump’s Executive Order re-imposing certain Iran-related sanctions, summarized in our recent post, the EU has expanded the scope of the EU Blocking Statute to cover certain US Iran-focused sanctions.  On August 7, immediately following the US government’s re-imposition of certain Iran-related sanctions, the Commission Delegated Regulation (EU) 2018/1100 amending the annex to the EU Blocking Statute was published in the EU Official Journal and entered into force.

In addition to the Delegated Regulation, the following two texts relating to the application of the Blocking Statute were published in the EU Official Journal:

  • Commission Implementing Regulation (EU) 2018/1101 which sets out: (i) the process for applying to the Commission for an authorization permitting full or partial compliance with the relevant US sanctions; and (ii) a non-exhaustive list of criteria that the Commission will consider in assessing whether an authorization should be granted; and
  • The Commission’s Guidance Note with non-binding guidance on the application of the revised Blocking Statute. The non-binding guidance covers various aspects of the Blocking Statute, including persons/entities within the scope of the Blocking Statute, its temporal application, effects of the Blocking Statute, recovery of damages arising from the application of US Iran-related sanctions, authorizations to comply with US Iran-related sanctions, etc.


Continue Reading EU Blocking Statute Takes Effect to Counter US Re-Imposed Sanctions on Iran

On June 6, and in furtherance of its May 16 announcement, the European Commission adopted a delegated act to amend the annex to the EU Blocking Statute by adding within its scope US Iran-related secondary sanctions that have extra-territorial application.  The delegated act will enter into force once it is published in the EU Official Journal – probably well before the August 16 deadline set out for the re-imposition of the US secondary sanctions – unless the European Parliament or the Council (the Member States) object within a two-month scrutiny period.

List of US Secondary Sanctions Newly Targeted

The revised annex sets out the third-country measures to which the statute applies should it enter into force. The revised annex includes the same references to US sanctions laws that have previously been included in the annex, namely those that target US sanctions on Cuba.  But it also lists the following new US sanctions laws and regulations specifically to address the reimposition of US sanctions pursuant to the US withdrawal of the JCPOA:
Continue Reading EU Extends the Scope of EU Blocking Statute to Protect Against Extra Territorial Application of US Re-Imposed Sanctions on Iran

On May 18, the Commission announced the launch of the formal process to activate the EU “blocking statute” (Council Regulation (EC) 2271/96) by updating the list of US sanctions on Iran falling within its scope.

The Commission starts the formal process after receiving unanimous informal support from the leaders of the EU Member States to a package of measures that the Commission has proposed to protect the interests of EU companies investing in Iran and to demonstrate the EU’s commitment to the Joint Comprehensive Plan of Action (JCPOA). As part of that package, the Commission:

  • Launched the formal process to remove obstacles for the European Investment Bank (EIB) to finance activities in Iran, under the EU budget guarantee.
  • Will continue and strengthen the ongoing sectoral cooperation with and assistance to Iran, including facilitating financial assistance through the Development Cooperation or Partnership Instruments.
  • Is encouraging Member States to explore the possibility of one-off bank transfers to the Central Bank of Iran which would allow the Iranian authorities to receive their oil-related revenues.


Continue Reading A Brief Explanation of the EU Blocking Statute Process in Support of the JCPOA

As the world seeks to come to grips with President Trump’s withdrawal from the JCPOA, it appears that the European Union will play one of its strongest cards by invoking its “Blocking Regulation, which would prohibit European companies from complying with US sanctions against Iran.  European Commission President Jean-Claude Juncker had

On January 12, President Trump announced that he was reissuing statutory waivers necessary to continue certain sanctions relief pursuant to the Joint Comprehensive Plan of Action (“JCPOA” or Iran nuclear deal), but stated that this was the last time he would reissue such waivers unless his concerns over the agreement were addressed.  On the same

As tensions continue to escalate between the United States and North Korea, and President Donald Trump and Kim Jong-Un trade increasingly tense lobs, the United Nations, the EU, the United States, and other countries continue to impose further stringent sanctions against North Korea to a breaking point (for details on UN Security Council Resolution 2375

On Wednesday, November 15 at 12:00 PM EST, Anthony Rapa will be presenting “Recent Developments in Economic Sanctions: Russia, Iran, Venezuela, North Korea, and Cuba,” a webinar hosted by Federal Publications.  As described on the Federal Publications website:

From “decertifying” the Iran deal to disputes with “Rocket Man,” the economic sanctions world has seen dizzying

In light of the continuing deterioration of the democracy and human rights in Venezuela, the Foreign Affairs Council of Ministers agreed on November 13 to adopt a first set of sanctions measures against Venezuela. These measures are reflected in two EU legal instruments, Council Regulation (EU) 2017/2063 of 13 November 2017 concerning restrictive measures in view of the situation in Venezuela and Council Decision (CFSP) 2017/2074 of 13 November 2017 concerning restrictive measures in view of the situation in Venezuela.

At this stage, the measures are not intended to cut off commerce with specific sectors of the economy in  Venezuela. Measures include:

  • A prohibition to sell, supply, transfer or export, directly or indirectly, goods and technology listed in the EU Common Military List, as well as equipment which may be used for internal repression as listed in Annex I of Council Regulation (EU) 2017/2063.  Related financial and technical assistance is also prohibited.
  • A prohibition to sell, supply, transfer or export, directly or indirectly, equipment, technology or software, as listed in Annex II of  Council Regulation (EU) 2017/2063. Related financial and technical assistance is also prohibited.


Continue Reading EU Adopts Initial Set of Sanctions Against Venezuela