This newsletter is a listing of the latest changes in export control regulations through February 29, 2024. The newsletter is provided as a complimentary service to assist exporters with their ITAR and EAR export compliance responsibilities. It provides a summary of recent changes to export control regulations or other regulatory matters of interest that may impact your company’s international trade and export compliance functions. Call us at 703-847-5801 or email info@fdassociates.net with questions or comments.
See also our “Latest Sanctions Fines & Penalties” section below for an update on companies and persons denied export privileges by the United States Government.
REGULATORY UPDATES
President
President Biden Signed A New Executive Order Imposing Certain Sanctions on Persons Undermining Peace, Security, and Stability in the West Bank
February 5, 2024: 89 Fed. Reg. 7605: President Biden issued Executive Order 14115 and found that the situation in the West Bank-in particular high levels of extremist settler violence, forced displacement of people and villages, and property destruction-has reached intolerable levels and constitutes a serious threat to the peace, security, and stability of the West Bank and Gaza, Israel, and the broader Middle East region. These actions undermine the foreign policy objectives of the United States, including the viability of a two state solution and ensuring Israelis and Palestinians can attain equal measures of security, prosperity, and freedom. They also undermine the security of Israel and have the potential to lead to broader regional destabilization across the Middle East, threatening United States personnel and interests. For these reasons, these actions constitute an unusual and extraordinary threat to the national security and foreign policy of the United States. All property and interests in property that are in the United States, that hereafter come within the United States, or that are or hereafter come within the possession or control of any United States person, including any foreign branch, are blocked and may not be transferred, paid, exported, withdrawn, or otherwise dealt in pursuant to this Executive Order. See actions taken by the Department of the Treasury, Office of Foreign Assets Control’s (OFAC) and the Department of the Treasury, and the Department of Treasury, Financial Crimes Enforcement Network (FinCEN) in response to this Executive Order for the list of affected persons and entities.
https://ofac.treasury.gov/media/932576/download?inline
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President Biden Continued The National Emergency with Respect to Afghanistan
February 7, 2024: The widespread humanitarian crisis in Afghanistan — including the urgent needs of the people of Afghanistan for food security, livelihoods support, water, sanitation, health, hygiene, and shelter and settlement assistance, among other basic human needs — and the potential for a deepening economic collapse in Afghanistan continue to pose an unusual and extraordinary threat to the national security and foreign policy of the United States. In addition, the preservation of certain property of Da Afghanistan Bank (DAB) held in the United States by United States financial institutions is of the utmost importance to addressing this national emergency and the welfare of the people of Afghanistan. Various parties, including representatives of victims of terrorism, have asserted legal claims against certain property of DAB or indicated in public court filings an intent to make such claims. This property is blocked under Executive Order 14064.
For these reasons, the national emergency declared in Executive Order 14064 of February 11, 2022, must continue in effect beyond February 11, 2024. Therefore, in accordance with section 202(d) of the National Emergencies Act (50 U.S.C. 1622(d)), President Biden continued for 1 year the national emergency declared in Executive Order 14064 with respect to the widespread humanitarian crisis in Afghanistan and the potential for a deepening economic collapse in Afghanistan.
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President Biden Continued The National Emergency with Respect to Burma
February 7, 2024: On February 10, 2021, by Executive Order 14014, President Biden declared a national emergency pursuant to the International Emergency Economic Powers Act (50 U.S.C. 1701-1706) to deal with the unusual and extraordinary threat to the national security and foreign policy of the United States constituted by the situation in and in relation to Burma.
The situation in and in relation to Burma, and in particular the February 1, 2021 coup, in which the military overthrew the democratically elected civilian government of Burma and unjustly arrested and detained government leaders, politicians, human rights defenders, journalists, and religious leaders, thereby rejecting the will of the people of Burma as expressed in elections held in November 2020 and undermining the country’s democratic transition and rule of law, continues to pose an unusual and extraordinary threat to the national security and foreign policy of the United States.
Therefore, in accordance with section 202(d) of the National Emergencies Act (50 U.S.C. 1622(d)), President Biden continued for 1 year the national emergency declared in Executive Order 14014 with respect to the situation in and in relation to Burma.
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President Biden Continued The National Emergency with Respect to Cuba and of the Emergency Authority Relating to the Regulation of the Anchorage and Movement of Vessels
February 21, 2024: In accordance with section 202(d) of the National Emergencies Act (50 U.S.C. 1622(d)), President Biden continued the national emergency with respect to Cuba and the emergency authority relating to the regulation of the anchorage and movement of vessels set out in Proclamation 6867, as amended by Proclamation 7757, Proclamation 9398, and Proclamation 9699.
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President Biden Continued the National Emergency With Respect to Libya
February 21, 2024: The situation in Libya continues to pose an unusual and extraordinary threat to the national security and foreign policy of the United States, and measures are needed to protect against the diversion of assets or other abuses by members of Qadhafi’s family, their associates, and other persons hindering Libyan national reconciliation.
For this reason, the national emergency declared on February 25, 2011, and expanded on April 19, 2016, must continue in effect beyond February 25, 2024. Therefore, in accordance with section 202(d) of the National Emergencies Act (50 U.S.C. 1622(d)), President Biden continued for 1 year the national emergency declared in Executive Order 13566.
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Department of State, Directorate of Defense Trade Controls (DDTC)
DECCS Pending Payment Notification Email Update
February 5, 2024: The Department of State, Directorate of Defense Trade Controls (DDTC) made changes to the pending payment notification email message text.
The Notifications being updated are:
- Status = “Pending Payment”
- After 5 Days in “Pending Payment” Status
- After 10 Days in “Pending Payment” Status
These updates clarify the instructions on how to proceed with making payments, ensuring a smoother and more user-friendly experience.
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DDTC Name And Address Changes Posted To Website
February 2 through 20, 2024: The Directorate of Defense Trade Controls (DDTC) posted the following name and/or address changes on its website at
- Change in Name from Hitachi Kokusai Electric, Inc. to Kokusai Denki Electric, Inc., due to acquisition;
- Change in Name from Stichting Nationaal Lucht-en Ruimtevaartlaboratorium to Stichting Koninklijk Nederlands Lucht-en Ruimtevaartcentrum (Royal Netherlands Aerospace Centre) due to corporate rebranding;
- Change in Name from Progeny Systems, LLC to General Dynamics Mission Systems, Inc., due to acquisition;
- Change in Name from Atkins Limited to AtkinsRéalis UK Limited due to corporate rebranding;
- Change in Name from Raytheon BBN Technologies Corp. to RTX BBN Technologies Inc., due to corporate rebranding;
- Change in Address from NHIndustries SAS formerly at Building Alizé, 765, rue Albert Einstein, CS 70402, 13591 Aix-en-Provence Cedex 3, France to NHIndustries SAS at Parc Lumiére, 405 rue Emilien Gautier, 13090 Aix-en-Provence, France;
- Change in Name from Airbus Defence and Space Savunma Uzay Havacilik Sanayi Ve Ticaret Anonim Sirketi to Airbus Havacilik Sanayi Ve Ticaret Anonim Sirketi due to corporate rebranding;
- Change in Name from Zodiac US Corporation to Safran USA, Inc., due to acquisition;
- Change in Name and Address from MASER Engineering B.V. formerly at Capitool 56, 7521 PR ENSCHEDE, The Netherlands to Eurofins MASER B.V. at Auke Vleerstraat 26, 7521 PG ENSCHEDE, The Netherlands due to corporate rebranding;
- Change in Name from AI Yah Satellite Communications Company PJSC to Bayanat AI PLC due to merger;
- Change in Name from Herley Industries LLC to CAES Mission Systems LLC due to acquisition;
- Change in Name from W.S. Atkins International Limited to AtkinsRéalis UK International Limited due to corporate rebranding.
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2024 DECCS User Group (DUG) Enrollment
February 2024:
DDTC announced the enrollment period is open for the 2024 DECCS User Group
What is it?
- The mission of the Defense Export Controls and Compliance System (DECCS) User Group (DUG) is to allow individual industry users to provide feedback on DECCS by establishing and maintaining a forum for active and regular communication between DECCS users and the Directorate of Defense Trade Controls (DDTC).
- DUG members will have the opportunity to:
- Identify functional and technical challenges when interacting with DECCS, and
- Provide feedback and input for future DECCS enhancements and system support initiatives.
How to get involved:
- To express your interest, email PM_DDTCProjectTeam@state.gov by COB February 29, 2024, and provide your name & company/government affiliation (as applicable).
- DDTC will inform applicants by March 31, 2024, on DUG membership selection.
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DSCA Notifies Congress Of Potential FMS Sale To India
February 1, 2024: The State Department has made a determination approving a possible Foreign Military Sale to the Government of India of MQ-9B Remotely Piloted Aircraft and related equipment for an estimated cost of $3.99 billion. The Government of India has requested to buy thirty-one (31) MQ-9B Sky Guardian aircraft; one hundred sixty-one (161) Embedded Global Positioning & Inertial Navigation Systems (EGIs); thirty-five (35) L3 Rio Grande Communications Intelligence Sensor Suites; one hundred seventy (170) AGM-114R Hellfire missiles; sixteen (16) M36E9 Hellfire Captive Air Training Missiles (CATM); three hundred ten (310) GBU-39B/B Laser Small Diameter Bombs (LSDB); and eight (8) GBU-39B/B LSDB Guided Test Vehicles (GTVs) with live fuzes. Also included are Certifiable Ground Control Stations; TPE-331-10-GD engines; M299 Hellfire missile launchers; KIV-77 cryptographic appliques and other Identification Friend or Foe (IFF) equipment; KOR-24A Small Tactical Terminals (STT); AN/SSQ-62F, AN/SSQ-53G, and AN/SSQ-36 sonobuoys; ADU-891/E Adapter Group Test Sets; Common Munitions Built-In-Test (BIT) Reprogramming Equipment (CMBRE); GBU-39B/B tactical training rounds, Weapons Load Crew Trainers, and Reliability Assessment Vehicles-Instrumented; Portable Pre-flight/Post-flight Equipment (P3E); CCM-700A encryption devices; KY-100M Narrowband/wideband terminals; KI-133 cryptographic units; AN/PYQ-10 Simple Key Loaders; Automatic Identification System (AIS) transponders; ROVER 6Si and TNR2x transceivers; MR6000 ultra high frequency (UHF) and very high frequency (VHF) radios; Selex SeaSpray Active Electronically Scanned Array (AESA) surveillance radars; HISAR-300 Radars; SNC 4500 Auto Electronic Surveillance Measures (ESM) Systems; SAGE 750 ESM systems; Due Regard Radars (DRR); MX-20 Electro-Optical Infrared (EO-IR) Laser Target Designators (LTDs); Ku-Band SATCOM GAASI Transportable Earth Stations (GATES); C-Band Line-of-Sight (LOS) Ground Data Terminals; AN/DPX-7 IFF transponders; Compact Multi-band Data Links (CMDL); initial spare and repair parts, consumables, accessories, and repair and return support; secure communications, precision navigation, and cryptographic equipment; munitions support and support equipment; testing and integration support and equipment; classified and unclassified software delivery and support; classified and unclassified publications and technical documentation; personnel training and training equipment; transportation support; warranties; studies and surveys; U.S. Government and contractor engineering, technical, and logistics support services; and other related elements of logistics and program support.
https://www.dsca.mil/press-media/major-arms-sales/india-mq-9b-remotely-piloted-aircraft
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DSCA Notifies Congress Of Potential FMS Sale To The Netherlands
February 2, 2024: The State Department has made a determination approving a possible Foreign Military Sale to the Government of the Netherlands of Hellfire Missiles and related equipment for an estimated cost of $150 million. The Government of the Netherlands has requested to buy up to three hundred eighty-six (386) Hellfire Air-to-Ground Missiles, AGM-114R2. Also included is U.S. Army Aviation and Missile Command (AMCOM) Security Assistance Management Directorate (SAMD) technical assistance; Tactical Aviation and Ground Munitions (TAGM) Project Office technical assistance; non-standard books, publications, and other Hellfire publications; integration support; and other related elements of logistics and program support.
https://www.dsca.mil/press-media/major-arms-sales/netherlands-hellfire-missiles
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DSCA Notifies Congress Of Potential FMS Sale To The Netherlands
February 5, 2024: The State Department has made a determination approving a possible Foreign Military Sale to the Government of the Netherlands of Joint Air-to-Surface Standoff Missiles with Extended Range and related equipment for an estimated cost of $908 million. The Government of the Netherlands has requested to buy one hundred twenty (120) AGM-158B/B-2 Joint Air-to-Surface Standoff Missiles with Extended Range (JASSM-ER) All-Up-Rounds; fifteen (15) AGM-158 Inert JASSMs with Test Instrumentation Kits; two (2) AGM-158 JASSM Separation Test Vehicles; one (1) AGM-158 Instrumented Test Vehicle; and two (2) JASSM Jettison Test Vehicles. Also included are AGM-158 JASSM Dummy Air Training Missiles (DATM) and containers; KGV-135A encryption devices; test and integration equipment and support; spare parts, consumables, accessories, and repair and return support; munitions support and support equipment; classified and unclassified publications and technical documentation; Contractor Logistics Support (CLS); transportation support; personnel training and training equipment; studies and surveys; U.S. Government and contractor engineering, technical, and logistics support services; and other related elements of logistics and program support.
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DSCA Notifies Congress Of Potential FMS Sale To Poland
February 7, 2024: The State Department has made a determination approving a possible Foreign Military Sale to the Government of Poland of Airspace and Surface Radar Reconnaissance aerostat systems and related elements of logistics and program support for an estimated cost of $1.2 billion. The Government of Poland has requested to buy Airspace and Surface Radar Reconnaissance (ASRR) aerostat systems; Airborne Early Warning (AEW) Radars with Identification of Friend or Foe (IFF) capability; electronic sensor systems; mooring systems with powered tether with embedded fiber optics; Ground Control Systems (GCS); associated installation hardware; special tools and test equipment; Basic Issue Items (BII); program management support; verification testing; systems technical support; transportation; spare and repair parts; communications equipment; operators and maintenance manuals; personnel training and training equipment; tool and test equipment; repair and return; publications and technical documentation; Quality Assurance Team (QAT); U.S. Government and contractor engineering, technical, and logistics support services; in-country Field Service Representatives (FSR); and other related elements of logistics and program support.
https://www.dsca.mil/press-media/major-arms-sales/poland-aerostat-systems
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DSCA Notifies Congress Of Potential FMS Sale To Italy
February 15, 2024: The State Department has made a determination approving a possible Foreign Military Sale to the Government of Italy of AIM-120C-8 Advanced Medium-Range Air-to-Air Missiles and related equipment for an estimated cost of $69.3 million. The Government of Italy has requested to buy twelve (12) AIM-120C-8 Advanced Medium Range Air-to-Air Missiles (AMRAAM) that will be added to a previously implemented case whose value was under the congressional notification threshold. The original Foreign Military Sales (FMS) case, valued at $32.5 million ($23.0 million in Major Defense Equipment (MDE)), included twelve (12) AIM-120C-8 AMRAAM missiles. This notification is for a combined total of twenty-four (24) AIM-120C-8 AMRAAM missiles. Also included are Common Munitions Built-in-Test (BIT)/Reprogramming Equipment (CMBRE); ADU-891 Adaptor Group Test Set; AMRAAM containers and support equipment; integration and test support and equipment; munitions support and support equipment; spare parts, consumables and accessories, and repair and return support; contractor logistics support; classified software delivery and support; classified and unclassified publications and technical documentation; studies and surveys; U.S. Government and contractor engineering, technical, and logistics support services; and other related elements of logistics and program support.
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DSCA Notifies Congress Of Potential FMS Sale To Italy
February 15, 2024: The State Department has made a determination approving a possible Foreign Military Sale to the Government of Italy of Small Diameter Bomb II and related equipment for an estimated cost of $150 million. The Government of Italy has requested to buy one hundred twenty-five (125) Guided Bomb Unit (GBU)-53/B Small Diameter Bombs-Increment II (SDB-II) All-Up-Rounds (AURs); and eight (8) GBU-53/B SDB-II Captive Carry Reliability Tests (CCRTs) that will be added to a previously implemented case whose value was under the congressional notification threshold. The original FMS case, valued at $22.5 million ($9.7 million in MDE), included twenty-four (24) GBU-53/B SDB-II AURs; and four (4) GBU-53/B SDB-II CCRTs. The Government of Italy has also requested a new FMS case that includes twenty-four (24) GBU-53/B SDB-II AURs; and two (2) GBU-53/B SDB-II CCRTs. This notification is for a combined total of one hundred seventy-three (173) GBU-53/B SDB-II AURs; and fourteen (14) GBU-53/B SDB-II CCRTs. Also included are SDB-II Weapon Load Crew Trainers (WLCT) and Practical Explosive Ordnance Disposal Trainers (PEST); munitions support and support equipment; unclassified software delivery and support; spare parts, consumables and accessories, and repair and return support; modifications and maintenance support; unclassified publications and technical documentation; studies and surveys; U.S. Government and contractor engineering, technical, and logistics support services; and other related elements of logistics and program support.
https://www.dsca.mil/press-media/major-arms-sales/italy-small-diameter-bomb-ii
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DSCA Notifies Congress Of Potential FMS Sale To Taiwan
February 21, 2024: The State Department has made a determination approving a possible Foreign Military Sale to the Taipei Economic and Cultural Representative Office in the United States of a Taiwan Advanced Tactical Data Link System Upgrade Planning and related equipment for an estimated cost of $75 million. The Defense Security Cooperation Agency delivered the required certification notifying Congress of this possible sale.
The Taipei Economic and Cultural Representative Office in the United States (TECRO) has requested to buy Foreign Military Sales (FMS) Cross Domain Solutions (CDS); High Assurance devices; Global Positioning System (GPS) receivers; communications equipment; requirements analysis; engineering; technical services; and other related elements of logistics and program support.
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DSCA Notifies Congress Of Potential FMS Sale To Germany
February 27, 2024: The State Department made a determination approving a possible Foreign Military Sale to the Government of Germany of High-Frequency, Very-High Frequency, and Ultra-High Frequency Radios and related equipment for an estimated cost of $281 million. The Defense Security Cooperation Agency delivered the required certification notifying Congress of this possible sale.
The Government of Germany has requested to buy AN/PRC-117 radios; AN/PRC-160 radios; spare and repair parts; support equipment; tools and test equipment; diagnostic equipment; technical data and publications; personnel training and training equipment; U.S. Government and contractor technical assistance; technical and logistics support services; and other related elements of logistics and program support.
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Department of Commerce – Bureau of Industry and Security (BIS)
Commerce and Industry Export Control Principals from the United States, Japan, and the Republic of Korea (ROK) Convened As A Follow-up to the Commerce and Industry Ministerial initiative from the Trilateral Leaders’ Summit
February 21, 2024: Commerce and Industry Export Control Principals from the United States, Japan, and the Republic of Korea (ROK) convened as a follow-up to the Commerce and Industry Ministerial initiative from the Trilateral Leaders’ Summit at Camp David last August. This meeting was the first in-person meeting of its kind under the trilateral relationship focused on further aligning export controls, enhancing the ability to effectively collaborate on shared priorities. The United States hosted the convening at the U.S. Embassy in Tokyo. The principals agreed to further align on Russia controls, collaborate on outreach to countries in Southeast Asia, and cooperate on controls for critical and emerging technologies.
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February 23, 2024: 89 Fed. Reg. 13590: The Bureau of Industry and Security (BIS) amended the Export Administration Regulations (EAR), which it maintains, by revising license requirements for certain cameras, systems, and related components. These revisions will better align controls with technological and commercial developments, such as the items’ global commercial availability, while recognizing the cooperative strategic relationship the United States has with our closest allies. In addition to these changes, BIS is adding controls on certain cameras that are not already controlled by either export control classification number (ECCN) 6A003 or 6A203. These new controls are detailed under new ECCN 6A293, which is a classification for temporary controls for which BIS is seeking multilateral agreement.
89 FR 13590.pdf (SECURED) (doc.gov)
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Department of Treasury, Financial Crimes Enforcement Network (FinCEN)
FinCEN Issued An Alert Related To The Financing Of Israeli Extremist Settler Violence Against Palestinians In The West Bank Per Executive Order 14115
February 2, 2024: The U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) issued an alert related to the financing of Israeli extremist settler violence against Palestinians in the West Bank per Executive Order 14115. The alert provides select red flags to assist U.S. financial institutions in identifying and reporting suspicious activity that finances such violence.
While the alert highlights the potential involvement of certain nonprofit organizations (NPOs) in facilitating payments to fund violence in the West Bank, FinCEN continues to emphasize that legitimate charities should have access to financial services and can transmit funds through legitimate and transparent channels. FinCEN is also reminding financial institutions to apply a risk-based approach to Customer Due Diligence (CDD) requirements when developing the risk profiles of charities and other non-profit customers. No specific customer types, including charities and NPOs, automatically presents a higher risk of illicit activity. Additionally, as no single red flag is necessarily indicative of illicit or suspicious activity, U.S. financial institutions are encouraged to consider all the surrounding facts and circumstances before determining whether a specific transaction is suspicious or associated with potential Israeli violent extremist groups or campaigns.
Finally, through the alert, Treasury’s Office of Foreign Assets Control (OFAC) is highlighting for members of the public that under the Executive Order of February 1, 2024, “Imposing Certain Sanctions on Persons Undermining Peace, Security, and Stability in the West Bank,” the U.S. government is authorized to impose sanctions on foreign persons that are responsible for or complicit in, or have directly or indirectly engaged or attempted to engage in (1) actions that threaten the peace, security, or stability of the West Bank; or (2) planning, ordering, otherwise directing, or participating in specified actions affecting the West Bank, such as violence targeting civilians and property destruction. The United States seeks to impose tangible and significant consequences on those engaged in such activities, as well as to protect the U.S. financial system from abuse.
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U.S. Census Bureau
Tips on How to Resolve AES Response Messages February 20, 2024: When a shipment is filed to the AES, a system response message is generated and indicates whether the shipment has been accepted or rejected. If the shipment is accepted, the AES filer receives an Internal Transaction Number (ITN) as confirmation. Though the shipment is accepted, the filer may still receive a Verify Message, Compliance Alert, Informational Message or Warning Message along with their ITN. However, if the shipment is rejected, a Fatal Error notification is received and must be corrected to receive a valid ITN.
To help you take the appropriate action for the different AES Response Messages, here are some tips on how to address the most frequent messages that were generated in AES for this month.
Response Code: 107
Narrative: Country of Ultimate Destination Unknown
Severity: Fatal
Reason: The Country of Ultimate Destination reported is not valid in AES.
Resolution: The Country of Ultimate Destination Code must be a valid ISO country code listed in the Appendix C – ISO Country Codes.
Verify the Country of Ultimate Destination, correct the shipment and resubmit.
Response Code: 511
Narrative: Mode of Transportation Not Allowed for License Code
Severity: Fatal
Reason: The Mode of Transportation reported is not valid for the License Code/License Exemption reported.
Resolution: The Mode of Transportation must be compatible with the reported License Code/License Exemption. See ‘Appendix F, License and License Exemption Type Codes’ to determine the appropriate Mode of Transportation and License Code/License Exemption combination.
Verify the Mode of Transportation and License Code/License Exemption, correct the shipment and resubmit.
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NOTICE: “Forwarding Agent” will be changing to “Authorized Agent” across the AESTIR and AESDirect portal
February 27, 2024: At the request of the U.S. Census Bureau, the terms “Forwarding Agent” and “FWRD AGT” found in the Automated Export System Trade Interface Requirements (AESTIR) commodity record format, appendices (i.e., commodity filing response messages, AES acronyms and definitions) and the AESDirect portal will be replaced with the term “Authorized Agent” and “AUTH AGT,” consistent with the Foreign Trade Regulations (DTR) 15 CFR 30.6(b)(1).
This change will be effective April 1, 2024.
Background:
Authorized Agent is the term used in the FTR to identify the individual or legal entity physically located in or otherwise under the jurisdiction of the United States that has obtained power of attorney or written authorization from a U.S. Principal Party in Interest (USPPI) or Foreign Principal Party in Interest (FPPI) to act on its behalf and to complete and file the Electronic Export Information (EEI).
When the Filer ID in the header and trailer records of the AES commodity format is an Authorized Agent, the Census Bureau relies on the details in the party records/section (N01-N03 records) of the Authorized Agent for verification purposes. Without that level of detail, the Filer ID by itself does not suffice for verification purposes.
The trade community has informed the Census Bureau that the term Forwarding Agent, currently in the party record/section and the appendices, is misleading. In most cases, the Forwarding Agent and the Authorized Agent are the same company. However, when there are scenarios when the Authorized Agent files the EEI and a Forwarding Agent facilitates the movement of the export of that same shipment, the Census Bureau must ensure that the Authorized Agent information is collected in the party record for verification purposes. The Census Bureau has had multiple occasions where the Forwarding Agent in the N01-N03 party records was not able to verify the data because they were not the filer. The Forwarding Agent in these filings only facilitated the export but did not prepare and file the EEI in AES. The same situation also applies when a USPPI files the EEI on their own behalf.
| LATEST SANCTIONS FINES & PENALTIES |
This section of our newsletter provides information on the latest sanctions, fines and penalties for export violations or matters of non-compliance with the ITAR or EAR issued by the US government enforcement agencies. It is provided as a service to exporters and associates of FD Associates to remind them of the importance of extreme due diligence in all international trade and export compliance matters, particularly those involving exports subject to the ITAR or the EAR. Don’t let this happen to you or your company! Call us with questions or concerns at 703-847-5801 or email info@fdassociates.net.
Fines and Penalties
February 1, 2024: Saber Fakih, 48, of the United Kingdom, to 18 months in prison for violations of the International Emergency Economic Powers Act (IEEPA) and Iranian Transactions and Sanctions Regulations. In addition to the prison term, Saber Fakih was ordered to serve three years of supervised release.
According to his plea agreement, Saber Fakih conspired with Bader Fakih, 43, of Canada, Altaf Faquih, 72, of the United Arab Emirates, and Alireza Taghavi, 48, of Iran, to export and attempt to export an Industrial Microwave System (IMS) and counter-drone system from the United States to Iran, without first obtaining the requisite license from the Department of Treasury’s Office of Foreign Assets Control (OFAC).
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February 1, 2024: Joly Germine, 31, of Croix-des-Bouquets, Haiti, the self-described “King” of a notoriously violent Haitian gang known as 400 Mawozo, pleaded guilty to his role in a gunrunning conspiracy that smuggled firearms to Haiti in violation of U.S. export laws, and the laundering of ransoms paid for U.S. hostages to the gang in 2021.
The conspiracy resulted in the purchase in the United States of at least 24 firearms, including AK-47s, AR-15s, an M4 Carbine rifle, an M1A rifle, and a .50 caliber rifle, described by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) as a military weapon, which were smuggled from the United States to the gang in Haiti for their criminal activities. Co-defendant Eliande Tunis, 45, of Pompano Beach, Florida, pleaded guilty on Jan. 17 to the same offenses.
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February 7, 2024: In two separate cases on opposite coasts, several individuals are charged – one of whom was arrested on February 6, 2024, in connection with sophisticated schemes to transfer sensitive technology, goods, and information for the benefit of hostile foreign adversaries, in violation of U.S. law.
In the Eastern District of New York, two Iranian nationals were charged with conspiring to export equipment used in the aerospace industry to the Government of Iran, in violation of the International Emergency Economic Powers Act (IEEPA), in connection with an alleged conspiracy to illegally export U.S. goods and technology without the required licenses.
In the Central District of California, a man was arrested for allegedly stealing trade secrets developed for use by the U.S. government to detect nuclear missile launches and track ballistic and hypersonic missiles.
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February 7, 2024: David Murar, 73, waived his right to indictment by a grand jury and pleaded guilty in U.S. District Court in St. Louis to one felony count of conspiracy to commit wire fraud. Murar admitted that from roughly April through October of 2022, he bid on and received at least nine U.S. government contracts by way of fraudulent misrepresentations, including that he would provide parts from domestic sources. Murar actually provided parts from China and other foreign countries. By doing so, Murar was able to underbid domestic suppliers. Murar broke the law by providing “military critical technical data,” which was restricted and protected information, to foreign individuals and/or entities. Murar also admitted to fraudulently using his wife’s name to gain a competitive advantage for one of his companies as a woman-owned small business, when he was really the actual owner and operator.
Murar fraudulently obtained contracts worth at least $333,465 for parts including nuts, bolts, washers, sleeves, and tools.
https://www.justice.gov/usao-edmo/pr/defense-department-contractor-missouri-admits-fraud
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February 12, 2024: The Department of Justice completed enforcement of a final order for forfeiture of a U.S.-manufactured Boeing 747 cargo plane, previously owned by Mahan Air, a sanctioned Iranian airline affiliated with the Islamic Revolutionary Guard Corp-Qods Force (IRGC-QF), a designated Foreign Terrorist Organization (FTO).
On February 11, 2024, the government of Argentina transferred physical custody of the aircraft to the United States pursuant to the final order of forfeiture, which rests all right, title, and interest in the aircraft in the United States of America. The Boeing 747 cargo plane arrived in the Southern District of Florida where it will be prepared for disposition.
The plane was previously detained by Argentine law enforcement. On July 19, 2022, the U.S. District Court for the District of Columbia issued a seizure warrant for the aircraft, which Argentine authorities promptly enforced. On Oct. 20, 2022, in support of its ongoing criminal investigation, the United States filed a civil forfeiture complaint alleging that the aircraft’s transfer from Mahan Air to Empresa de Transporte Aéreocargo del Sur, S.A. (EMTRASUR), a Venezuelan cargo airline and subsidiary of Consorcio Venezolano de Industrias Aeronáuticas y Servicios Aéreos, S.A (CONVIASA), a Venezuelan state-owned company, violated U.S. export control laws. As alleged, Mahan Air was subject to a Department of Commerce Temporary Denial Order, which prohibited, among other things, Mahan Air from engaging in any transactions involving any commodity exported from the United States that is subject to the Export Administration Regulations. The complaint further alleged that the unauthorized transfer of this aircraft directly benefited the IRGC-QF.
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February 12, 2024: Kristina Puzyreva pleaded guilty to money laundering conspiracy for her role in a multimillion-dollar scheme to send components used in unnamed aerial vehicles (UAVs) and guided missile systems and other weapons to sanctioned entities in Russia. The components shipped in violation of export control and sanctions laws were later found in Russian weapons platforms and signals intelligence equipment in Ukraine. At sentencing, Puzyreva faces up to twenty years in prison.
Kristina Puzyreva and her co-defendants allegedly purchased and dispatched millions of dollars in U.S.-sourced electronics to support the Kremlin in its ongoing attacks of Ukraine. Her money laundering conspiracy was directly linked to 298 shipments of restricted technology, valued at $7 million, to the Russian battlefield.
As alleged in the indictment and other court filings, the defendant laundered money as part of a sophisticated export control and sanctions evasion scheme involving SH Brothers Inc. (SH Brothers) and SN Electronics, Inc. (SN Electronics), two companies registered in Brooklyn, New York. Using the SH Brothers and SN Electronics corporate entities, the defendant’s co-conspirators unlawfully sourced, purchased and shipped millions of dollars in dual-use electronics from U.S. manufacturers to end users, including sanctioned entities, in Russia. The electronic components and integrated circuits shipped were later found in seized Russian weapons platforms and signals intelligence equipment in Ukraine, including in UAVs and guided missiles. During the period charged in the indictment, SH Brothers made hundreds of shipments valued at over $7 million to Russia.
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February 28, 2024: The Boeing Company (“Boeing”) entered into a three (3) year Consent Agreement to settle allegations that it violated the International Traffic in Arms Regulations (ITAR) in connection with unauthorized exports and retransfers of technical data to foreign-person employees and contractors; unauthorized exports to the People’s Republic of China, a proscribed country; and violations of license terms, conditions, and provisos of Directorate of Defense Trade Controls – DDTC authorizations. All of the violations were Voluntarily Disclosed to the Department of State by Boeing over a period of years pursuant to multiple Voluntary Disclosures. Boeing agreed to pay a fine of $51,000,000 of which $24,000,000 will be used by Boeing for remedial compliance measures.
Remedial Measures:
Boeing shall ensure that adequate resources are dedicated to ITAR compliance throughout its ITAR-regulated operating divisions, subsidiaries, and business units. Boeing shall establish policies and procedures for all of Boeing ‘s employees with responsibility for AECA and ITAR compliance to address lines of authority, staffing levels, performance evaluations, and career paths.
Boeing, in coordination with the Designated Official (as defined below), shall conduct an internal review of AECA and ITAR compliance resources and establish the necessary actions to ensure that sufficient resources are dedicated to AECA and IT AR compliance.
Boeing shall appoint, in accordance with the provisions of this Consent Agreement and in consultation with and the approval of the Director, Defense Trade Controls Compliance – DTCC, a qualified individual to serve as a Designated Official for the entire term that the Consent Agreement is in force. The term “Designated Official” in this Consent Agreement refers to a Special Compliance Officer (SCO) 1 or Internal Special Compliance Officer (ISCO)2 during the term of their appointment.
Boeing shall strengthen corporate compliance procedures focused principally on Boeing’s business operations such that: (a) all Boeing employees engaged in AECA and ITAR-regulated activities are
familiar with the AECA and the ITAR, and their own and Boeing’s responsibilities thereunder; (b) all persons responsible for supervising those employees, including senior managers of those units, are knowledgeable about the underlying policies and principles of the AECA and the ITAR; and (c) there are records indicating the names of employees, trainers, and level and area of training received.
Boeing shall enhance its AECA and ITAR compliance program with specific attention to the areas described in paragraphs 9(k)(I)(i) through 9(k)(1)(vii). Respondent shall provide to DTCC written confirmation that the company has completed this action.
Boeing agreed to implement a comprehensive, automated export compliance system throughout its operating divisions, subsidiaries, and business units engaged in AECA and ITAR-regulated activities to strengthen its internal controls for ensuring compliance with the AECA and the ITAR. This system shall track the decision process from the initiation to conclusion of a request for export, reexport, or retransfer
authorization. The automated export compliance system shall improve Boeing’s ability to oversee and monitor export, reexport, and retransfer activity. This system shall also cover the initial identification of all technical data and technical assistance in any form proposed to be disclosed to any foreign persons. Boeing shall ensure the use of a means of alerting users to the AECA and ITAR requirements on electronic transmissions of ITAR-controlled technical data. In order to prevent unintentional or accidental transmissions to unauthorized recipients, Boeing shall also provide training lo all employees to ensure that any type of electronic transmissions of ITAR-controlled technical data are sent in accordance with Boeings’ export compliance policies and procedures.
Classification Review:
Boeing shall, under the supervision of the Designated Official, review, verify, and complete the export control jurisdiction of all hardware and/or software that Boeings’ AECA and ITAR-regulated operating divisions, subsidiaries and business units, and any defense services or technical data, directly related to such hardware and not related to any hardware.
Also, separately, prior to export, re-export and/or retransfer, Boeing shall review, verify, and complete the export control jurisdiction of each hardware item (and any defense services or technical data, including software, directly related to such hardware item and not related to any hardware) and items procured from
suppliers for which such jurisdiction was not previously and accurately determined and/or verified in accordance with this paragraph.
Audits:
Two audits shall be performed during the Consent Agreement. Boeing shall have the first audit conducted by an outside consultant with expertise in AECA and ITAR matters, approved by the Direcror, DTCC. The audit shall be conducted under the supervision of the Designated Official. The first audit shall provide a thorough assessment of the effectiveness of Boeing’s implementation of all measures set forth in this Consent Agreement with focus on those actions undertaken to address the compliance issues identified in the Proposed Charging Letter, the policies, procedures, and training established by Boeing. The Designated Official or the Director, DTCC, may identify other areas (e.g., transactional review of agreements, Respondent’s information technology systems) for the first audit.
Debarment:
Boeing has cooperated with the Department’s review, has expressed regret for these activities, and has taken steps to improve its compliance programs. It has also undertaken to pay a cash penalty and agrees to implement the significant additional remedial compliance actions specified in the Consent Agreement. For these reasons, the Department determined not to impose an administrative debarment of Boeing.
Onsite Reviews by the Department:
For the purpose of assessing compliance with the provisions of the AECA, the ITAR and future authorizations, Boeing agreed to arrange and facilitate, with minimum advance notice, onsite reviews by the Department while this Consent Agreement remains in effect.
Violations:
Boeing disclosed the following violations to the Department:
Unauthorized Exports to Foreign-Person Employees and Contractors:
Boeing disclosed in two separate voluntary disclosures that from 2013- 2018 foreign-person employees (FPEs) at multiple Boeing and partner facilities overseas downloaded without authorization on more than 100 occasions files containing ITAR-controlled technical data from the Boeing Library System (BLS), the company’s digital technical document repository.
From 2013-2017 three FPEs from the People’s Republic of China (PRC), which is a proscribed destination under ITAR 126.1(d)(1), working at Boeings’ facilities in the PRC downloaded ITAR-controlled technical data from the BLS on 25 occasions. The files were controlled under multiple USML categories, including IV(i), VIII(i), IX(e)(1), XI(d), XII(f), XIII(l), XIX(g), and involved multiple U.S. Department of Defense (DoD) platforms, including the F18, F-15, F-22, E-3 Airborne Warning and Control System, AH-64 Apache, AGM84E Standoff Land Attack Missile, and AGM-131 Short Range Attack Missile II.
In a subsequent voluntary disclosure, Boeing disclosed that from 2013-2018 an indeterminate number of FPEs and contractors working at Boeing and – 4 – partner facilities in 18 countries, including Australia, Canada, France, Germany, Hong Kong, India, Italy, Japan, Kenya, Morocco, Russia, Singapore, South Korea, Spain, Thailand, Taiwan, Ukraine, and the United Kingdom (UK) downloaded ITAR-controlled technical data on 80 occasions. At the time of these unauthorized exports, Russia was subject to restrictive measures on defense exports per the Department of State public announcement on April 28, 2014. The documents were controlled under multiple USML categories, including IV(i), VIII(i), IX(e)(1), XI(d), XII(f), and XIX(g).
Unauthorized Exports, Reexports, Retransfers, and Temporary Imports of Defense Articles, including Technical Data:
In addition to violations involving FPEs, Boeing submitted multiple voluntary disclosures involving unauthorized exports, reexports, retransfers, and temporary imports of defense articles, including technical data.
Unauthorized Exports Resulting from Fabricated Permanent Export Licenses:
A trade compliance specialist working at Boeing’s U.S. subsidiary, Aviall Services, Inc., fabricated five permanent export licenses, which resulted in Boeing exporting USML Category XIX(f)(1)-(3) nozzle segments and seal strips to Portugal and Turkey without DDTC authorization on seven occasions between July and November 2018. When the company became aware of the employee’s actions, it promptly took corrective measures and voluntarily disclosed the matter.
Unauthorized Exports and Retransfers of Technical Data Resulting from Jurisdiction and Classification Issues:
Boeing submitted multiple disclosures involving unauthorized exports stemming from jurisdiction and classification issues. For example, Boeing disclosed that due to misclassification, it temporarily imported and subsequently exported while improperly relying on Department of Commerce authorizations USML Category VIII(h)(18) parts for the AH-64 Apache Helicopter flight control system to multiple countries on five occasions between August 2018 and August 2022. Respondent
Unauthorized Exports, Retransfers, and Temporary Imports of Defense Articles:
Boeing exported USML Category XI(d) technical data to Canada without authorization on two occasions in March 2017. The exports occurred when an employee at Boeing’s U.S. subsidiary Argon exported without authorization requests for quotation to a potential supplier in Canada that contained a total of nine drawings with USML XI(d) technical data related to the ceramic acoustic structure of towed torpedo decoys used on U.S. and allied warships. The U.S. Government reviewed copies of the files and determined that it would not have authorized the exports had a license application been submitted.
Violation of Terms, Conditions, and Provisos of DDTC Authorizations:
Respondent submitted multiple voluntary disclosures that demonstrated issues with managing export authorizations, including failures to comply with the terms, conditions, and provisos of DDTC authorizations.
Copies of the Charging Letter, Agreement and Order can be found at the following links:
Article – DDTC Public Portal (state.gov) and
Article – DDTC Public Portal (state.gov) and
Article – DDTC Public Portal (state.gov)
Sanctions
Department of State
February 23, 2024: Following Russia’s two years of unprovoked full-scale war, the death of opposition politician and anticorruption activist Aleksey Navalny, and a decade of aggression against Ukraine, the United States sanctioned more than 500 individuals and entities in Russia and globally. There is a clear link between Russia’s authoritarianism, its domestic crackdown on dissent, and its aggression abroad.
The Department of State sanctioned three individuals in connection with the death of Navalny in Russian Penal Colony IK-3: the prison warden, regional prison head, and deputy director of the Federal Penitentiary Service of Russia. In addition, the Department imposed sanctions on more than 250 entities and individuals, including those engaged in sanctions evasion and circumvention, and those bolstering Russia’s future energy and metals and mining production.
Along with these actions, the Department sanctioned several individuals to promote accountability for acts supporting Russia’s war, including by those involved in the unlawful transfer and/or deportation of Ukrainian children. These financial sanctions targets were designated pursuant to Executive Order (E.O.) 14024, as amended, which authorizes sanctions with respect to specified harmful foreign activities of the Government of the Russian Federation.
The Department also took steps to impose visa restrictions on Russian Federation-installed purported authorities involved in human rights abuses in connection with the transfer, deportation and confinement of Ukrainian children.
Additionally, the U.S. government issued a business advisory to assist companies in making informed decisions regarding the risks of conducting business in Russia.
See the links below for the list of persons and entities sanctioned by the Department as the list is too voluminous to for this newsletter.
https://www.state.gov/imposing-measures-in-response-to-navalnys-death-and-two-years-of-russias-full-scale-war-against-ukraine/ and https://www.state.gov/russia-business-advisory/
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Department of Commerce, Bureau of Industry and Security (BIS)
February 23, 2024: 89 Fed. Reg. 14385: Following the death of opposition politician and anti-corruption activist Aleksey Navalny, and after two years of Russia’s unprovoked and unlawful full-scale invasion of Ukraine, the Commerce Department’s Bureau of Industry and Security (BIS) imposed additional export restrictions on 93 entities under 95 entries in Russia and seven other destinations. This action, along with others announced by the Department of State and the Department of Treasury, demonstrates the Biden-Harris Administration’s unwavering commitment to supporting those affected by Russia’s aggression.
Entity List additions continue efforts to cut off the Russian defense industrial base and military from even the low-technology consumer goods it seeks to sustain its war effort. Prior to this action, the Biden Harris Administration had added 815 entities in Russia, Belarus, and numerous third countries to the Entity List since March 2nd, 2022, for reasons related to Russia’s full-scale invasion of Ukraine or for otherwise supporting Russia’s military and/or defense industry.
Pursuant to this action, BIS added an additional 93 entities under 95 entries (due to some entities operating in multiple countries) to the Entity List for a variety of reasons related to their activities in support of Russia’s defense-industrial sector and war effort. Sixty-three of the entities are based in Russia, eight in the People’s Republic of China, sixteen in Turkiye, four in the United Arab Emirates (UAE), two in the Kyrgyz Republic, and one each in India and South Korea.
More than 50 of the entities added to the list will also receive a “footnote 3” designation as Russian-Belarusian military end users. A footnote 3 designation subjects these entities to some of the most severe restrictions under the Export Administration Regulations (EAR). The entities are added with a license requirement for all items subject to the EAR and a license review policy of denial, apart from food and medicine designated as EAR99, which will be reviewed on a case-by-case basis. These rules are meant to serve as a response to Russian aggression against Ukraine. BIS added entities in several allied and partner countries, but it is not an action against the countries in which the entities are located or registered or the governments of those countries. The restrictions imposed in this rule serve as an action against those entities listed, which have supported the Russian military industrial base and other activities contrary to U.S. national security and foreign policy interests.
See the links below for the list of persons and entities sanctioned by BIS as the list is too voluminous to for this newsletter.
https://www.bis.doc.gov/index.php/documents/about-bis/newsroom/press-releases/3452-2024-02-23-bis-press-release-russia-two-year-actions/file and https://www.federalregister.gov/public-inspection/2024-03969/additions-of-entities-to-the-entity-list
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February 27, 2024: 89 Fed. Reg. 14403: The Commerce Department’s Bureau of Industry and Security (BIS) added two entities to the Entity List under seven entries for activities contrary to U.S. national security and foreign policy interests. One entity was found to have been involved in supporting online censorship and surveillance to target political actors and human rights activities, and the other is being added for diversion of U.S. items to an Entity Listed party.
Two entities are being added to the Entity List under seven entries in multiple countries. One entity operating in multiple destinations globally is being listed due to information that it supplies deep packet inspection technology to a foreign government, where it is used in mass web-monitoring and censorship to block news as well as target political actors and human rights activists. One entity is based in the People’s Republic of China (PRC) and is being added for acquiring and attempting to acquire U.S.-origin items on behalf of a party on the Entity List. As a result of this rule, any transactions with these entities that involve items subject to the Export Administration Regulations (EAR) will require a license from the BIS, and applications for those licenses are likely to be denied.
The following 2 entities are added to the Entity List under 7 entries to the Entity List and includes, where appropriate, aliases:
Canada
- Sandvine Incorporated.
China
- Chengdu Beizhan Electronics Co., Ltd.
India
- Sandvine Incorporated.
Japan
- Sandvine Incorporated.
Malaysia
- Sandvine Incorporated.
Sweden
- Sandvine Incorporated.
United Arab Emirates
- Sandvine Incorporated.
https://www.bis.doc.gov/index.php/documents/about-bis/newsroom/press-releases/3454-2024-02-26-bis-press-release-entity-list-additions/file and https://www.bis.doc.gov/index.php/documents/regulations-docs/federal-register-notices/federal-register-2024/3456-2024-03674/file
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February 29, 2024: The U.S. Department of Commerce issued an advance notice of proposed rulemaking (ANPRM) seeking public comment to inform the potential development of regulations to secure and safeguard the Information and Communications Technology and Services (ICTS) supply chain for connected vehicles (CVs).
The ANPRM explains how the incorporation of foreign adversary ICTS in CVs can create risks, for example, by offering a direct entry point to sensitive U.S. technology and data or by bypassing measures intended to protect U.S. persons’ safety and security. In such cases, ICTS provided by persons or entities owned, controlled, or subject to the jurisdiction or direction of a foreign adversary may pose undue risks to critical infrastructure in the United States and unacceptable risks to national security. The People’s Republic of China presents a particularly acute and persistent threat to the U.S. ICTS supply chain related to CVs. This ANPRM demonstrates the Biden-Harris Administration’s proactive efforts to address the potential national security risks associated with the ICTS integral to CVs and is a significant step in advancing the ICTS mission. In this ANPRM, the Department seeks feedback on a number of issues, including: definitions; how potential classes of ICTS transactions integral to CVs may present undue or unacceptable risks to U.S. national security; implementation mechanisms to address these risks through potential prohibitions or, where feasible, mitigation measures; and whether to create a process for the public to request approval to engage in an otherwise prohibited transaction by demonstrating that the risk to U.S. national security is sufficiently mitigated in the context of a particular transaction.
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Department of the Treasury, Office of Foreign Assets Control (OFAC)
February 1, 2024: The Department of the Treasury’s Office of Foreign Assets Control (OFAC) published the Price Cap Coalition Compliance and Enforcement Alert. The oil price cap (OPC), introduced by the “Price Cap Coalition” (or “G7+ Coalition”, comprising the G7, the European Union, and Australia) in December 2022, has two key objectives: 1) constraining Russian revenues that could otherwise be used to fund Russia’s war of aggression against Ukraine; while 2) maintaining global oil flows and protecting energy security.
This alert includes:
- An overview of key OPC evasion methods and recommendations for identifying such methods and mitigating their risks and negative impacts; and
- Information on how to report OPC suspected breaches across the Price Cap Coalition.
The OPC evasion methods covered in this alert are related to:
- Falsified documentation and attestations;
- Opaque shipping and ancillary costs;
- Third country supply chain intermediaries and complex and irregular corporate structures;
- Flagging;
- The “shadow” fleet; and
- Voyage irregularities.
https://ofac.treasury.gov/recent-actions/20240201_33 and https://ofac.treasury.gov/media/932571/download?inline
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February 1, 2024: Pursuant to Executive Order 14115 (See first entry above) the Department of the Treasury, Office of Foreign Assets Control’s (OFAC) updated its Specially Designated Nationals and Blocked Persons List:
The following individuals have been added to OFAC’s SDN List:
- Chasdai, David Chai of Israel;
- Levi, Yinon of Israel;
- Tanjil, Einan of Israel; and
- Zicherman, Shalom of Israel.
https://ofac.treasury.gov/recent-actions/20240201
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February 2, 2024: The Department of the Treasury’s Office of Foreign Assets Control (OFAC) amended FAQ 629 and published an updated document titled, “Frequently Asked Questions Related to the Suspension of Certain U.S. Sanctions with Respect to Venezuela on October 18, 2023.”
Frequently Asked Question 629: Executive order (E.O.) 13850 of November 1, 2018, “Blocking Property of Additional Persons Contributing to the Situation in Venezuela,” authorizes the imposition of sanctions on persons operating in Venezuela’s gold sector. For purposes of this E.O., how will OFAC target those who “operate in the gold sector of the Venezuela economy or any other sector of the Venezuela economy as may be determined by the Secretary of the Treasury in consultation with the Secretary of State”?
Answer: OFAC expects to use its discretion to target in particular those who operate corruptly in the gold or other identified sectors of the Venezuela economy, and not those who are operating legitimately in such sectors. This includes, for example, persons engaging in dishonest or fraudulent conduct, illicit activity, or deceptive transactions within Venezuela’s gold sector or other identified Venezuela sectors, with the purpose or effect of misappropriating Venezuelan resources in those sectors for personal, professional, or political gain.
https://ofac.treasury.gov/recent-actions/20240202_33 and https://ofac.treasury.gov/faqs/629 and https://ofac.treasury.gov/media/932581/download?inline
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February 2, 2024: The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned a key procurement network of prolific suppliers of materials and sensitive technology for Iran’s ballistic missile and Unmanned Aerial Vehicle (UAV) programs, including the Shahed-series UAV produced by Iran’s Shahed Aviation Industries Research Center (SAIRC). The four Iran- and Hong Kong-based entities designated have operated as covert procurement entities for OFAC designated Hamed Dehghan and Pishtazan Kavosh Gostar Boshra (PKGB), who are actively engaged in supporting multiple Iranian military organizations, including the Islamic Revolutionary Guard Corps (IRGC). Additionally, OFAC designated a Hong Kong-based front company involved in the sale of hundreds of millions of dollars’ worth of Iranian commodities for the benefit of the Islamic Revolutionary Guard Corps-Qods Force (IRGC-QF).
OFAC also sanctioned six officials in the Iranian Islamic Revolutionary Guard Corps Cyber-Electronic Command (IRGC-CEC), an Iranian government organization responsible for a series of malicious cyber activities against critical infrastructure in the United States and other countries.
The United States is taking action against these individuals in response to IRGC-affiliated cyber actors’ recent cyber operations in which they hacked and posted images on the screens of programmable logic controllers manufactured by Unitronics, an Israeli company. Industrial control devices, such as programmable logic controllers, used in water and other critical infrastructure systems, are sensitive targets. Although this particular operation did not disrupt any critical services, unauthorized access to critical infrastructure systems can enable actions that harm the public and cause devastating humanitarian consequences.
The following individuals have been added to OFAC’s SDN List:
- Homayunfal, Hamid of Iran;
- Lashgarian, Hamid Reza of Iran;
- Lashgarian, Mahdi of Iran;
- Mansuri, Milad of Iran; and
- Saberian, Reza Mohammad Amin of Iran.
The following entities have been added to OFAC’s SDN List:
- Advantage Trading Co., Limited, of China;
- China Oil And Petroleum Company Limited of China;
- Duling Technology Hk Limited of China;
- Fy International Trading Co., Limited of China; and
- Narin Sepehr Mobin Isatis of Iran.
https://home.treasury.gov/news/press-releases/jy2073 and https://home.treasury.gov/news/press-releases/jy2072 and https://ofac.treasury.gov/recent-actions/20240202
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February 7, 2024: The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned one of Ecuador’s most violent gangs, Los Choneros, and its leader, José Adolfo Macías Villamar (also known by the alias “Fito”), pursuant to counter narcotics authorities. OFAC’s action follows a steep rise in violence in Ecuador attributed to the actions of Los Choneros and other drug trafficking gangs in the country.
The following individual has been added to OFAC’s SDN List:
- Macias Villamar, Jose Adolfo of Ecuador.
The following entity has been added to OFAC’s SDN List:
- Los Choneros of Ecuador.
https://home.treasury.gov/news/press-releases/jy2082 and https://ofac.treasury.gov/recent-actions/20240207
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February 8, 2024: The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) took its second price cap enforcement action of 2024, imposing sanctions on four entities and identifying one vessel as blocked property. The network of these entities and the vessel were involved in a price cap violation scheme in late 2023. OFAC is also issued two new determinations that implement G7 commitments to ban the importation of Russian diamonds.
The following entities have been added to OFAC’s SDN List:
- NS Leader Shipping Incorporated Of Liberia;
- Oil Tankers Scf Mgmt FZCO of the United Arab Emirates;
- Talassa Shipping DMCC of he United Arab Emirates; and
- Zeenit Supply And Trading DMCC of the United Arab Emirates.
The following vessel has been added to OFAC’s SDN List:
- NS Leader (A8LU7) Crude Oil Tanker Gabon flag; Identification Number IMO 9339301; MMSI 636013272 (vessel).
OFAC also published a Determination for Prohibitions Related to Imports of Diamond Jewelry and Unsorted Diamonds of Russian Federation Origin and Diamond Jewelry and Unsorted Diamonds Exported From the Russian Federation, and a Determination for Prohibitions Related to Imports of Certain Categories of Diamonds.
OFAC also issued Russia-related General License 87, “Authorizing Limited Safety and Environmental Transactions Involving Certain Persons or Vessels Blocked on February 8, 2024.”
Russia-related General License 87: All transactions prohibited by Executive Order (E.O.) 14024 that are ordinarily incident and necessary to one of the following activities involving the blocked persons described below are authorized through 12:01 a.m. eastern daylight time, May 8, 2024, provided that any payment to a blocked person must be made into a blocked account in accordance with the Russian Harmful Foreign Activities Sanctions Regulations (RuHSR):
(1) The safe docking and anchoring in port of any vessels in which any person or entity listed in below has a property interest (“blocked vessels”);
(2) The preservation of the health or safety of the crew of any of the blocked vessels; or
(3) Emergency repairs of any of the blocked vessels or environmental mitigation or protection activities relating to any of the blocked vessels.
The authorization above applies to the following blocked persons listed on the Office of Foreign Assets Control’s Specially Designated Nationals and Blocked Persons List and any entity in which any of the following persons own, directly or indirectly, individually or in the aggregate, a 50 percent or greater interest:
(1) Oil Tankers SCF MGMT FZCO; and
(2) NS Leader Shipping Incorporated.
https://home.treasury.gov/news/press-releases/jy2085 and https://ofac.treasury.gov/recent-actions/20240208 and https://ofac.treasury.gov/media/932606/download?inline and https://ofac.treasury.gov/media/932611/download?inline and https://ofac.treasury.gov/media/932601/download?inline
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February 14, 2024: The Department of the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned a procurement network responsible for facilitating the illegal export of goods and technology from over two dozen U.S. companies to end-users in Iran, including the Central Bank of Iran (CBI), which is designated for its role in providing financial support to the Islamic Revolutionary Guard Corps-Qods Force (IRGC-QF) and Hizballah. These designations target three individuals and four entities tied to the procurement of sophisticated U.S. technology for use by CBI in violation of U.S. export restrictions and sanctions. Among the goods and technology acquired by CBI were items classified as information security items subject to national security and anti-terrorism controls by the U.S. Department of Commerce’s Bureau of Industry and Security.
The following individuals have been added to OFAC’s SDN List:
- Khademi, Mohammad Reza of the United Arab Emirates;
- Mirdamadi, Pouria of Iran and France; and
- Najafi, Seyed Abotaleb of Iran.
The following entities have been added to OFAC’s SDN List:
- Advance Banking Solution Trading DMCC of the United Arab Emirates;
- Freedom Star General Trading CO. L.L.C. of the United Arab Emirates;
- Informatics Services Corporation of Iran; and
- Ted Teknoloji Gelistirme Hizmetleri Sanayi Ticaret Anonim Sirketi of Turkey.
https://ofac.treasury.gov/recent-actions/20240214 and https://home.treasury.gov/news/press-releases/jy2095
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February 15, 2024: 89 Fed. Reg. 12233: The Department of the Treasury’s Office of Foreign Assets Control (OFAC) is amended the North Korea Sanctions Regulations to amend or add general licenses to facilitate certain humanitarian-related and journalistic activities. Specifically, OFAC amended an existing general license for nongovernmental organizations and adding general licenses to authorize certain transactions related to the exportation and re-exportation of items authorized by the U.S. Department of Commerce; the provision of certain agricultural commodities, medicine, and medical devices; and certain journalistic activities in North Korea.
OFAC has also issued several new North Korea-related Frequently Asked Questions (1160, 1161, 1162, 1163).
Frequently Asked Question 1160: What changes did the February 15, 2024 regulatory amendment to the North Korea Sanctions Regulations, 31 CFR part 510 (NKSR), make?
Answer: On February 15, 2024, OFAC, in consultation with the Department of State, amended the NKSR to modify an existing general license (GL) and add three new GLs to facilitate humanitarian-related and other activities in North Korea. These changes include:
- Additional non-governmental organization (NGO) activities
OFAC amended the GL at § 510.512 to authorize NGOs to engage in a broader range of humanitarian-related activities involving North Korea, including certain educational activities and activities to support disarmament, demobilization, and reintegration (DDR) programs and peacebuilding, conflict prevention, and conflict resolution programs. The general license at § 510.512 allows transactions that are ordinarily incident and necessary to such NGO activities involving certain Government of North Korea entities, including limited partnerships, subject to certain conditions and limitations–including that the NGO must submit a report to the U.S. Department of State at least 30 days before their proposed activities, as further described in FAQ 1162.
The amended NGO GL at § 510.512 authorizes the export and reexport to North Korea of items not subject to the Export Administration Regulations (15 CFR parts 730 through 774) (EAR) to North Korea that are ordinarily incident and necessary to authorized NGO activities, provided the items would be designated as EAR99 if located in the United States.
- Removal of dual licensing burden
To avoid duplicative licensing requirements, OFAC added a new GL at § 510.520 to authorize all transactions ordinarily incident to the exportation or reexportation of items (i.e., commodities, software, or technology) to North Korea, provided the exportation or reexportation is licensed or otherwise authorized by the Department of Commerce. Such transactions may include transactions with the Government of North Korea, or any other person blocked pursuant to the NKSR, and services provided outside North Korea to install, repair, or replace authorized items. Accordingly, U.S. persons no longer need to seek a specific license from OFAC to engage in transactions ordinarily incident to exports and reexports that are already licensed or otherwise authorized by the Department of Commerce.
- Expansion of authorization for the exportation or reexportation of certain food, medicine, and other agricultural and medical items
OFAC added a new GL at § 510.521 to authorize certain transactions related to the export and reexport to North Korea of certain agricultural commodities (including food), medicine, medical devices, and replacement parts and components for medical devices, that are not subject to the EAR but that would be designated EAR99 if they were located in the United States, subject to certain conditions and limitations.
- Journalistic activities
OFAC added a new GL at § 510.522 to authorize U.S. news reporting organizations and certain of their U.S. person employees to engage in certain transactions ordinarily incident and necessary to their journalistic activities or the establishment or operation of a news bureau in North Korea.
Frequently Asked Question 1161: Does the general license for non-governmental organization (NGO) activities at section 510.512 of the North Korea Sanctions Regulations, 31 CFR part 510 (NKSR), authorize NGOs to engage in transactions involving the Government of North Korea?
Answer: Yes, subject to certain conditions and limitations. NGOs may engage in transactions with the Government of North Korea to the extent ordinarily incident and necessary to the activities authorized by § 510.512(a). Such transactions may not include partnerships and partnership agreements with Government of North Korea military, intelligence, or law enforcement entities, except as necessary to export or import items to or from North Korea that are licensed or otherwise authorized pursuant to the NKSR or pursuant to the Export Administration Regulations (15 CFR parts 730 through 774) (EAR). For example, NGOs may engage with North Korea’s Ministry of Public Health to provide assistance to clean water projects; with customs officials to import humanitarian-related items into the country; and with local jurisdictions, such as city governments and hospitals, to provide food and medical devices. However, this general license does not authorize the exportation or reexportation of services to, charitable donations to or for the benefit of, or any other transactions involving, the Government of North Korea, the Workers’ Party of Korea, or any other person whose property and interests in property are blocked pursuant to the NKSR, except as ordinarily incident and necessary to an activity authorized pursuant to § 510.512(a).
Frequently Asked Question 1162: What must a non-governmental organization (NGO) do before relying on the general license (GL) at § 510.512 of the North Korea Sanctions Regulations, 31 CFR part 510 (NKSR)?
Answer: To be eligible for the NGO GL, an NGO must first submit a report to the U.S. Department of State via email to DPRK-NGO-GL-Notification-DL@state.gov no fewer than 30 days before the commencement of their activities, with one of the following: (1) a copy of approval by the UN Security Council 1718 Committee (1718 Committee) with respect to the NGO’s activities; (2) a copy of a 1718 Committee exemption request or notification that has been or will be submitted to the 1718 Committee with respect to the NGO’s activities; or (3) a detailed explanation of why the NGO’s proposed activities do not require such an exemption or notification, including details about the type and scope of the proposed activities. In the two-week period following submission of this information, the U.S. Department of State may notify the NGO that it is not eligible to rely upon the GL. An NGO that does not receive this type of notification may proceed with the activities described in the report.
Frequently Asked Question 1163: Can I export tobacco or other luxury goods to North Korea?
Answer: No. The general license for the exportation or reexportation of certain agricultural and medical items at § 510.521 of the North Korea Sanctions Regulations, 31 CFR part 510, does not authorize the exportation or reexportation to North Korea of luxury goods, including tobacco, as set forth in 15 CFR § 746.4(b)(1) of the Export Administration Regulations (15 CFR parts 730 through 774).
https://ofac.treasury.gov/recent-actions/20240215 and https://ofac.treasury.gov/media/932631/download?inline and https://ofac.treasury.gov/faqs/1160 and https://ofac.treasury.gov/faqs/1161 and https://ofac.treasury.gov/faqs/1162 and https://ofac.treasury.gov/faqs/1163
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February 16, 2024: The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) issued an OFAC Compliance Communiqué: Guidance for the Provision of Humanitarian-Related Assistance and Critical Commodities to the Yemeni People in response to questions from the NGO community and the general public on how to ensure humanitarian assistance and trade continue to flow to the Yemeni people while complying with OFAC sanctions.
OFAC is also issued Counter Terrorism General License 28, “Authorizing Transactions for Third-Country Diplomatic and Consular Missions Involving Ansarallah.”
The following entity has been added to OFAC’s SDN List:
Ansarallah of Yemen.
Counter Terrorism General License 28:
All transactions prohibited by the Global Terrorism Sanctions Regulations, 31 CFR part 594 (GTSR), involving Ansarallah, or any entity in which Ansarallah owns, directly or indirectly, a 50 percent or greater interest, that are ordinarily incident and necessary to the official business of third-country diplomatic or consular missions to Yemen are authorized.
This general license does not authorize:
(1) Financial transfers to any blocked person described above, other than for the purpose of effecting the payment of taxes, fees, or import duties, or the purchase or receipt of permits, licenses, or public utility services; or
(2) Any transactions otherwise prohibited by the GTSR, including transactions involving any person blocked pursuant to the GTSR other than the blocked persons described above, unless separately authorized.
https://ofac.treasury.gov/recent-actions/20240216 and https://ofac.treasury.gov/media/932621/download?inline and https://ofac.treasury.gov/media/932626/download?inline
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February 20, 2024: The Department of the Treasury’s Office of Foreign Assets Control (OFAC) is issuing Russia-related General License 83A, “Authorizing Certain Transactions Related to Imports of Certain Categories of Fish, Seafood, and Preparations Thereof Prohibited by Executive Order 14068.”
Russia-related General License 83A: All transactions prohibited by the determination of December 22, 2023 made pursuant to section 1(a)(i)(B) of Executive Order (E.O.) 14068, as amended by E.O. 14114 (“Prohibitions Related to Imports of Certain Categories of Fish, Seafood, and Preparations Thereof”), that are ordinarily incident and necessary to the importation into the United States of seafood derivative products that were loaded onto a vessel at the port of loading prior to 12:01 a.m. eastern standard time on February 20, 2024, pursuant to written contracts or written agreements entered into prior to December 22, 2023, are authorized through 12:01 a.m. eastern daylight time, May 31, 2024. (b) This general license does not authorize any transactions otherwise prohibited by the Russian Harmful Foreign Activities Sanctions Regulations, 31 CFR part 587 (RuHSR), including transactions involving any person blocked pursuant to the RuHSR, unless separately authorized. Effective February 20, 2024, General License No. 83, dated December 22, 2023, is replaced and superseded in its entirety by this General License No. 83A.
https://ofac.treasury.gov/recent-actions/20240220_33 and https://ofac.treasury.gov/media/932636/download?inline
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February 20, 2024: The United States designated two individuals who are affiliates of the Russia-based ransomware group LockBit. This action is the first in an ongoing collaborative effort with the U.S. Department of Justice, Federal Bureau of Investigation, and our international partners targeting LockBit.
Russia continues to offer safe harbor for cybercriminals where groups such as LockBit are free to launch ransomware attacks against the United States, its allies, and partners. These ransomware attacks have targeted critical infrastructure, including hospitals, schools, and financial institutions. Notably, LockBit was responsible for the November 2023 ransomware attack against the Industrial and Commercial Bank of China’s (ICBC) U.S. broker-dealer. The United States is a global leader in the fight against cybercrime and is committed to using all available authorities and tools to defend Americans from cyber threats. In addition to the actions announced, the U.S. government provides critical resources to support potential victims in protecting against and responding to ransomware attacks. For example, last year, the Cybersecurity & Infrastructure Security Agency in conjunction with other U.S. Departments and Agencies and foreign partners published two cybersecurity advisories, “Understanding Ransomware Threat Actors: LockBit” and “LockBit 3.0 Ransomware Affiliates Exploit CVE 2023-4966 Citrix Bleed Vulnerability.” These advisories detail the threats posed by this group and provide recommendations to reduce the likelihood and impact of future ransomware incidents.
The following individuals have been added to OFAC’s SDN List:
- Kondratiev, Ivan Gennadievich of Russia; and
- Sungatov, Artur Ravilevich, Kazan, of Russia.
https://home.treasury.gov/news/press-releases/jy2114 and https://ofac.treasury.gov/recent-actions/20240220
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February 23, 2024: Marking Russia’s two years of unprovoked and unlawful full-scale war against Ukraine and in response to the death of opposition politician and anticorruption activist Aleksey Navalny, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned almost 300 individuals and entities. Together with actions from the U.S. Department of State (State), this is the largest number of sanctions imposed since Russia’s full-scale invasion of Ukraine. State designated three Government of Russia officials in connection with Navalny’s death; together, Treasury and State sanctioned over 500 targets to impose additional costs for Russia’s repression, human rights abuses, and aggression against Ukraine. The Department of Commerce also added more than 90 companies to the Entity List.
To deny Russia the resources necessary to support its brutal war against Ukraine, Treasury designatedg targets including a major cog in Russia’s financial infrastructure; more than two dozen third-country sanctions evaders in Europe, East Asia, Central Asia, and the Middle East; and hundreds of entities in Russia’s military-industrial base and other key sectors.
State’s concurrent actions include sanctions on those involved in supporting Russian future energy revenue sources, maintaining Russia’s capacity to wage its war of aggression, and facilitating sanctions evasion and circumvention. State also took steps to impose visa restrictions on Russian Federation-installed purported authorities involved in the transfer, deportation, and confinement of Ukraine’s children.
See the links below for the list of persons and entities added to the SDN list as the list is too voluminous for this newsletter.
The Department of the Treasury’s Office of Foreign Assets Control (OFAC) is issuing Russia-related General License 88, “Authorizing the Wind Down of Transactions Involving Certain Entities Blocked on February 23, 2024;” Russia-related General License 89, “Authorizing the Wind Down and Rejection of Transactions Involving Certain Financial Institutions Blocked on February 23, 2024;” Russia-related General License 90, “Authorizing Certain Transactions Related to Debt or Equity of, or Derivative Contracts Involving, Certain Entities Blocked on February 23, 2024;” and Russia-related General License 91, “Authorizing Limited Safety and Environmental Transactions Involving Certain Blocked Persons or Vessels.”
Russia-related General License 88: All transactions prohibited by Executive Order (E.O.) 14024 that are ordinarily incident and necessary to the wind down of any transaction involving one or more of the following blocked entities are authorized through 12:01 a.m. eastern daylight time, April 8, 2024, provided that any payment to a blocked person is made into a blocked account in accordance with the Russian Harmful Foreign Activities Sanctions Regulations, 31 CFR part 587 (RuHSR): (1) PJSC Transcontainer; (2) Publichnoe Aktsionernoe Obshchestvo Mechel; (3) JSC SUEK; (4) ILLC Geopromining Investment; (5) LLC Holding GPM; (6) Joint Stock Company Samara Metallurgical Plant; (7) Joint Stock Company Rimera; (8) Public Joint Stock Company Pipe Metallurgical Company; (9) Vostochnaya Stevedoring Company LLC; (10) JSC Rosgeologia; (11) National Payment Card System Joint Stock Company; (12) Limited Liability Company BSF Capital; (13) Limited Liability Company Investment Consultant Elbrus Capital; (14) Limited Liability Company Orbita Capital Partners; (15) Nonprofit Organization Investment and Venture Fund of the Republic of Tatarstan; (16) Obshchestvo S Ogranichennoi Otvetstvennostyu Guard Kapital; (18) Limited Liability Company Shipbuilding Complex Zvezda; (19) Joint Stock Company Sovcomflot; and (20) Any entity in which one or more of the above persons own, directly or indirectly, individually or in the aggregate, a 50 percent or greater interest.
https://ofac.treasury.gov/media/932671/download?inline
Russia-related General License 89: All transactions prohibited by Executive Order (E.O.) 14024 that are ordinarily incident and necessary to the wind down of any transaction involving one or more of the following blocked entities are authorized through 12:01 a.m. eastern daylight time, April 8, 2024, provided that any payment to a blocked person is made into a blocked account in accordance with the Russian Harmful Foreign Activities Sanctions Regulations, 31 CFR part 587 (RuHSR): (1) Avangard Joint Stock Bank; (2) Bank RostFinance; (3) Joint Stock Commercial Bank Chelindbank; (4) Joint Stock Commercial Bank International Financial Club; (5) Joint Stock Commercial Bank Modulbank; (6) Joint Stock Company Databank; (7) Maritime Joint Stock Bank Joint Stock Company; (8) Public Joint Stock Company Bystrobank; and (9) Any entity in which one or more of the above persons own, directly or indirectly, individually or in the aggregate, a 50 percent or greater interest.
https://ofac.treasury.gov/media/932646/download?inline
Russia-related General License 90: All transactions prohibited by Executive Order (E.O.) 14024 that are ordinarily incident and necessary to the divestment or transfer, or the facilitation of the divestment or transfer, of debt or equity issued or guaranteed by the following blocked entities (“Covered Debt or Equity”) to a non-U.S. person are authorized through 12:01 a.m. eastern daylight time, April 8, 2024: (1) LLC Holding GPM; (2) Limited Liability Company Geopromaining Verkhne Menkeche; (3) Joint Stock Company Sarylakh Surma; (4) Joint Stock Company Zvezda; (5) ILLC Geopromining Investment; (6) Public Joint Stock Company PIK Specialized Homebuilder; and (7) Any entity in which one or more of the above persons own, directly or indirectly, individually or in the aggregate, a 50 percent or greater interest.
All transactions prohibited by E.O. 14024 that are ordinarily incident and necessary to facilitating, clearing, and settling trades of Covered Debt or Equity that were placed prior to 4:00 p.m. eastern standard time, February 23, 2024 are authorized through 12:01 a.m. eastern daylight time, April 8, 2024.
All transactions prohibited by E.O. 14024 that are ordinarily incident and necessary to the wind down of derivative contracts entered into prior to 4:00 p.m. eastern standard time, February 23, 2024 that (i) include a blocked person described in paragraph (a) of this general license as a counterparty or (ii) are linked to Covered Debt or Equity are authorized through 12:01 a.m. eastern daylight time, April 8, 2024, provided that any payments to a blocked person are made into a blocked account in accordance with the Russian Harmful Foreign Activities Sanctions Regulations, 31 CFR part 587 (RuHSR).
https://ofac.treasury.gov/media/932651/download?inline
Russia-related General License 91: All transactions prohibited by Executive Order (E.O.) 14024 that are ordinarily incident and necessary to one of the following activities involving the blocked persons described below are authorized through 12:01 a.m. eastern daylight time, May 23, 2024, provided that any payment to a blocked person must be made into a blocked account in accordance with the Russian Harmful Foreign Activities Sanctions Regulations, 31 CFR part 587 (RuHSR): (1) The safe docking and anchoring in port of any vessels in which any person listed below has a property interest (“blocked vessels”); (2) The preservation of the health or safety of the crew of any of the blocked vessels; or (3) Emergency repairs of any of the blocked vessels or environmental mitigation or protection activities relating to any of the blocked vessels.
The authorization above applies to the following blocked persons listed on the Office of Foreign Assets Control’s Specially Designated Nationals and Blocked Persons List and any entity in which any of the following persons own, directly or indirectly, individually or in the aggregate, a 50 percent or greater interest: (1) Ladoga Shipping Company Limited Liability Company; (2) JSC Polar Marine Geosurvey Expedition; (3) Yuzhmorgeologiya AO; (4) Sevmorneftegeofizika AO; and (5) Amige AO.
https://ofac.treasury.gov/media/932656/download?inline
OFAC is also issuing three new, Russia-related Frequently Asked Questions (FAQs 1164-1166) and amending eight Russia-related Frequently Asked Questions (FAQs 886, 887, 1019, 1022, 1025, 1027, 1092, and 1154).
Answer: On March 11, 2022, the Biden Administration issued Executive Order (E.O.) 14068, prohibiting the importation into the United States of non-industrial diamonds of Russian Federation origin. See FAQs 1019 and 1027 for the definition of Russian Federation origin and non-industrial diamonds, respectively. On December 6, 2023, the G7 Leaders announced a coordinated international effort to impose phased restrictions on the importation of certain Russian diamonds, including diamonds processed in third countries. As a part of this G7 commitment, OFAC has issued additional restrictions on the importation of non-industrial diamonds mined, extracted, produced, or manufactured wholly or in part in the Russian Federation as well as unsorted diamonds and diamond jewelry.
Specifically, on February 8, 2024, OFAC issued two determinations, “Prohibitions Related to Imports of Certain Categories of Diamonds” pursuant to Executive Order (E.O.) 14068 (the “Diamonds Determination”) and “Prohibitions Related to Imports of Diamond Jewelry and Unsorted Diamonds of Russian Federation Origin and Diamond Jewelry and Unsorted Diamonds Exported From the Russian Federation” pursuant to Executive Order (E.O.) 14068 (the “Diamond Jewelry and Unsorted Diamonds Determination”).
Answer: The Diamonds Determination prohibits the importation and entry into the United States of two categories of diamonds, effective on the dates indicated below.
Effective March 1, 2024, the Diamonds Determination prohibits the importation of non-industrial diamonds that were mined, extracted, produced, or manufactured wholly or in part in the Russian Federation with a weight of 1.0 carat or greater, even if such diamonds have been substantially transformed into other products outside of the Russian Federation.
Effective September 1, 2024, the Diamonds Determination prohibits the importation of Russian non-industrial diamonds with a weight of 0.5 carats or greater, even if such diamonds have been substantially transformed into other products outside of the Russian Federation.
For example, a non-industrial diamond that is mined in Russia but then undergoes manufacturing operations such as being cut, faceted, or polished in a third country, is prohibited from importation and entry into the United States, if at the time of importation, it is 1.0 carat or greater as of March 1, 2024 or 0.5 carats or greater as of September 1, 2024.
See FAQ 1027 for the definition of non-industrial diamonds. See FAQ 1166 for information on the prohibition related to diamond jewelry and unsorted diamonds.
Answer: The Diamond Jewelry Determination prohibits the importation and entry into the United States of diamond jewelry and unsorted diamonds of Russian Federation origin, as well as diamond jewelry and unsorted diamonds that were exported from the Russian Federation. For example, it prohibits the importation into the United States of a diamond bracelet that has been manufactured in the Russian Federation, regardless of where the diamonds originated.
This prohibition comes into effect on March 1, 2024. See FAQ 1027 for the definition of diamond jewelry. See FAQ 1019 for the definition of Russian Federation origin. See FAQ 1165 for information on the prohibition related to certain categories of non-industrial diamonds. For additional information on certification and traceability of diamonds, please contact U.S. Customs and Border Protection.
https://home.treasury.gov/news/press-releases/jy2117 and https://ofac.treasury.gov/faqs/added/2024-02-23 and https://ofac.treasury.gov/faqs/search/886+887+1019+1022+1025+1027+1092+1154
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February 23, 2024: The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) took action to responsibly reduce Russia’s revenue from oil sales by targeting Joint Stock Company Sovcomflot (Sovcomflot), Russia’s state-owned shipping company and fleet operator. In addition to designating Sovcomflot, OFAC is identified 14 crude oil tankers as property in which Sovcomflot has an interest.
Concurrent with the designation of Sovcomflot, OFAC issued a general license authorizing the offloading of crude oil (or other cargo) from these 14 vessels for a period of 45 days. In addition, OFAC issued a general license authorizing transactions with all other Sovcomflot-owned vessels at this time. Nothing in these general licenses changes any of the restrictions imposed by the price cap sanctions regime.
Sovcomflot was designated pursuant to Executive Order (E.O.) 14024 for operating or having operated in the marine sector of the Russian Federation economy and for being owned or controlled by, or having acted for or on behalf of, directly or indirectly, the Government of the Russian Federation. Sovcomflot has also been sanctioned by Australia, Canada, New Zealand, and the United Kingdom (UK) and is under certain European Union (EU) restrictions.
The following entity has been added to OFAC’s SDN List:
- Joint Stock Company Sovcomflot of Russia.
The following vessels have been added to OFAC’s SDN List:
- Anatoly Kolodkin (3E7525) Crude Oil Tanker Panama flag; Vessel Registration Identification IMO 9610808; MMSI 352003372;
- Georgy Maslov (TRBD9) Crude Oil Tanker Gabon flag; Vessel Registration Identification IMO 9610793; MMSI 626362000;
- Krymsk (TRBE3) Crude Oil Tanker Gabon flag; Vessel Registration Identification IMO 9270529; MMSI 626364000 (vessel);
- Liteyny Prospect (TRBE6) Crude Oil Tanker Gabon flag; Vessel Registration Identification IMO 9256078; MMSI 626367000 (vessel);
- Nevskiy Prospect (TRBE8) Crude Oil Tanker Gabon flag; Vessel Registration Identification IMO 9256054; MMSI 626369000 (vessel);
- NS Antarctic (TRBF3) Crude Oil Tanker Gabon flag; Vessel Registration Identification IMO 9413559; MMSI 626372000 (vessel);
- NS Bravo (TRBF8) Crude Oil Tanker Gabon flag; Vessel Registration Identification IMO 9412359; MMSI 626377000 (vessel);
- NS Burgas (TRBF9) Crude Oil Tanker Gabon flag; Vessel Registration Identification IMO 9411020; MMSI 626378000 (vessel);
- NS Captain (TRBG2) Crude Oil Tanker Gabon flag; Vessel Registration Identification IMO 9341067; MMSI 626379000 (vessel);
- NS Columbus (TRBG5) Crude Oil Tanker Gabon flag; Vessel Registration Identification IMO 9312884; MMSI 626382000 (vessel);
- NS Consul (TRBH3) Crude Oil Tanker Gabon flag; Vessel Registration Identification IMO 9341093; MMSI 626388000 (vessel);
- NS Creation (TRBH5) Crude Oil Tanker Gabon flag; Vessel Registration Identification IMO 9312896; MMSI 626390000 (vessel);
- NS Lion (TRBH8) Crude Oil Tanker Gabon flag; Vessel Registration Identification IMO 9339313; MMSI 626393000 (vessel);
- Sakhalin Island (3E4139) Crude Oil Tanker Panama flag; Vessel Registration Identification IMO 9249128; MMSI 352002202 (vessel).
Russia Related General License 88A: All transactions prohibited by Executive Order (E.O.) 14024 that are ordinarily incident and necessary to the wind down of any transaction involving one or more of the following blocked entities are authorized through 12:01 a.m. eastern daylight time, April 8, 2024, provided that any payment to a blocked person is made into a blocked account in accordance with the Russian Harmful Foreign Activities Sanctions Regulations, 31 CFR part 587 (RuHSR): (1) PJSC Transcontainer; (2) Publichnoe Aktsionernoe Obshchestvo Mechel; (3) JSC SUEK; (4) ILLC Geopromining Investment; (5) LLC Holding GPM; (6) Joint Stock Company Samara Metallurgical Plant; (7) Joint Stock Company Rimera; (8) Public Joint Stock Company Pipe Metallurgical Company; (9) Vostochnaya Stevedoring Company LLC; (10) JSC Rosgeologia; (11) National Payment Card System Joint Stock Company; (12) Limited Liability Company BSF Capital; (13) Limited Liability Company Investment Consultant Elbrus Capital; (14) Limited Liability Company Orbita Capital Partners; (15) Nonprofit Organization Investment and Venture Fund of the Republic of Tatarstan; (16) Obshchestvo S Ogranichennoi Otvetstvennostyu Guard Kapital; (18) Limited Liability Company Shipbuilding Complex Zvezda; (19) Joint Stock Company Sovcomflot; and (20) Any entity in which one or more of the above persons own, directly or indirectly, individually or in the aggregate, a 50 percent or greater interest.
https://ofac.treasury.gov/media/932671/download?inline
Russia Related General License 91A: All transactions prohibited by Executive Order (E.O.) 14024 that are ordinarily incident and necessary to one of the following activities involving the blocked persons described in paragraph (b) are authorized through 12:01 a.m. eastern daylight time, May 23, 2024, provided that any payment to a blocked person must be made into a blocked account in accordance with the Russian Harmful Foreign Activities Sanctions Regulations, 31 CFR part 587 (RuHSR): (1) The safe docking and anchoring in port of any vessels in which any person listed in paragraph (b) of this general license has a property interest (“blocked vessels”); (2) The preservation of the health or safety of the crew of any of the blocked vessels; or (3) Emergency repairs of any of the blocked vessels or environmental mitigation or protection activities relating to any of the blocked vessels.
The authorization above applies to the following blocked persons listed on the Office of Foreign Assets Control’s Specially Designated Nationals and Blocked Persons List and any entity in which any of the following persons own, directly or indirectly, individually or in the aggregate, a 50 percent or greater interest: (1) Ladoga Shipping Company Limited Liability Company; (2) JSC Polar Marine Geosurvey Expedition; (3) Yuzhmorgeologiya AO; (4) Sevmorneftegeofizika AO (5) Amige AO; and (6) Joint Stock Company Sovcomflot.
https://ofac.treasury.gov/media/932676/download?inline
Russia Related General License 92: All transactions prohibited by Executive Order (E.O.) 14024 that are ordinarily incident and necessary to the delivery and offloading of cargo from any vessel identified on the Office of Foreign Assets Control’s List of Specially Designated Nationals and Blocked Persons that is blocked solely due to a property interest of Joint Stock Company Sovcomflot (Sovcomflot), or any entity in which Sovcomflot owns, directly or indirectly, a 50 percent or greater interest, are authorized through 11:59 p.m. eastern daylight time, April 8, 2024, provided that the cargo was loaded prior to February 23, 2024.
https://ofac.treasury.gov/media/932661/download?inline
Russia Related General License 93: All transactions prohibited by Executive Order (E.O.) 14024 involving any vessel that is blocked solely due to a property interest of Joint Stock Company Sovcomflot or any entity in which Sovcomflot owns, directly or indirectly, a 50 percent or greater interest, are authorized, provided that such vessel is not identified on the Office of Foreign Assets Control’s List of Specially Designated Nationals and Blocked Persons.
https://ofac.treasury.gov/media/932666/download?inline
https://home.treasury.gov/news/press-releases/jy2121 and https://ofac.treasury.gov/recent-actions/20240223_33
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February 27, 2024: The Department of the Treasury’s Office of Foreign Assets Control (OFAC), in coordination with the United Kingdom, took action against the Deputy Commander of Iran’s Islamic Revolutionary Guard Corps-Qods Force (IRGC-QF), Mohammad Reza Falahzadeh, as well as a Houthi group member. OFAC is also designating the owner and operator of a vessel used to ship Iranian commodities that were sold to support both the Houthis and the IRGC-QF. The revenue generated through these illicit networks enables the Houthis’ militant efforts, including numerous terrorist attacks in the region using advanced unmanned aerial vehicles and missiles. This action follows the recent U.S. Department of State designation of Ansarallah (commonly known as the Houthis) as a Specially Designated Global Terrorist as a result of their ongoing and unprecedented attacks on international maritime commerce in the Red Sea and Gulf of Aden. This action was taken pursuant to the counterterrorism authority Executive Order (E.O.) 13224, as amended, which targets terrorist groups, their supporters, and those who aid acts of terrorism. The IRGC-QF was designated pursuant to E.O. 13224 on October 25, 2007, for providing support to multiple terrorist groups.
OFAC also took action against two companies registered in Hong Kong and the Marshall Islands that own and operate a vessel, the Panama-flagged KOHANA, shipping over $100 million in Iranian commodities to businesses in the People’s Republic of China (PRC) on behalf of Iran’s Ministry of Defense and Armed Forces Logistics (MODAFL). MODAFL continues to facilitate the delivery of Iranian weapons, most notably unmanned aerial vehicles (UAVs), to Russia in support of its war of aggression in Ukraine and to Iranian-aligned militia groups in the Middle East.
The following individuals have been added to OFAC’s SDN List:
- Al-Nashiri, Ibrahim of Yemen; and
- Falahzadeh, Mohammad Reza of Iran.
The following entities have been added to OFAC’s SDN List:
- Cap Tees Shipping Co., Limited of China;
- Iridescent Co LTD of the Marshall Islands and China; and
- Kohana Company Limited of China.
The following vessels have been added to OFAC’s SDN List:
- Artura (3E3496) Crude Oil Tanker Panama flag; Vessel Registration Identification IMO 9150365; MMSI 352002279 (vessel); and
- Kohana (3E4115) Crude Oil Tanker Panama flag; Vessel Registration Identification IMO 9254082; MMSI 352002176 (vessel).
https://home.treasury.gov/news/press-releases/jy2125 and https://home.treasury.gov/news/press-releases/jy2127 and https://ofac.treasury.gov/recent-actions/20240227
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February 28, 2024: The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) redesignated, pursuant to Executive Order (E.O.) 14059, the Los Pochos Drug Trafficking Organization (DTO), and designated three members and four affiliated companies based in Guatemala. First sanctioned in 2019 pursuant to the Kingpin Act, the Los Pochos DTO is a Guatemala-based organization primarily engaged in cocaine trafficking from Guatemala through Mexico to the United States. This action placed renewed attention on the Los Pochos DTO following a change in leadership and involvement of its members in local Guatemalan politics. The Los Pochos DTO controls narcotics trafficking activities on the Guatemala-Mexico border and is associated with Mexico’s Sinaloa Cartel, one of the world’s most notorious drug trafficking organizations.
The following individuals have been added to OFAC’s SDN List:
- Morales Cifuentes, Juan Jose of Guatemala;
- Ochoa Villagran, Erick Manuel of Guatemala; and
- Suniga Morfin, Isel Aneli of Guatemala.
The following entities have been added to OFAC’s SDN List:
- Condado Real of Guatemala;
- Construhogar of Guatemala;
- Importadora Jireh of Guatemala; and
- Wiv, Sociedad Anonima of Guatemala.
https://home.treasury.gov/news/press-releases/jy2133 and https://ofac.treasury.gov/recent-actions/20240228
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February 29, 2024: The Department of the Treasury’s Office of Foreign Assets Control (OFAC) is issuing Venezuela General License 45B, “Authorizing Certain Repatriation Transactions Involving Consorcio Venezolano de Industrias Aeronáuticas y Servicios Aéreos, S.A.”
Venezuela General License 45B: All transactions ordinarily incident and necessary to the repatriation of Venezuelan nationals from non-U.S. jurisdictions in the Western Hemisphere to Venezuela, and which are exclusively for the purposes of such repatriation, involving Consorcio Venezolano de Industrias Aeronáuticas y Servicios Aéreos, S.A. (Conviasa), or any entity in which Conviasa owns, directly or indirectly, a 50 percent or greater interest, that are prohibited by Executive Order (E.O.) 13850, as amended by E.O. 13857, or E.O. 13884, each as incorporated into the Venezuela Sanctions Regulations, 31 CFR part 591 (the VSR), are authorized.
This General License includes transactions for the maintenance (including repair) of the aircraft being used for such repatriation flights.
This general license does not authorize any transactions otherwise prohibited by the VSR, including any transactions involving any person blocked pursuant to the VSR other than the blocked persons described in paragraph (a) of this general license, Government of Venezuela persons blocked solely pursuant to E.O. 13884, Banco Central de Venezuela, or Banco de Venezuela SA Banco Universal.
https://ofac.treasury.gov/recent-actions/20240229 and https://ofac.treasury.gov/media/932686/download?inline