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Welcome to Sanctions Sound-Off A forum to share developments and trends in the regulatory areas of OFAC sanctions, export controls, and BSA/AML compliance

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Demonstrating the importance of knowing who you’re doing business with, Amazon, the largest web-based retailer, submitted a voluntary self-disclosure to OFAC for a potential sanctions violation. According to a recent quarterly report from Amazon, it is under federal investigation after selling products to at least one Iranian on the SDN list.

Read more here.

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The U.S. Treasury Department designated 16 entities and individuals for supporting “illicit Iranian actors or transnational criminal activity.” Read more here.

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Today, President Trump issued an amendment to the E.O. easing sanctions against Sudan. The amendment extends the probationary review period allotted to the U.S. government,  giving the U.S. more time to determine whether the government of Sudan has made demonstrable progress against human rights abuses. The probationary review period was set to end today, Wednesday, July 12, making the lifting of sanctions against Sudan permanent. Many humanitarian organizations have lauded the move, saying that the government of Sudan has not yet made sufficient progress to warrant a permanent easing of U.S. sanctions. The Government of Sudan responded, issuing “a presidential decree ordering the suspension of the committee that was negotiating (the lifting of the sanctions) with the United States until October 12” according to its official news agency.

See further analysis on other implications of the E.O., specifically Sudan’s involvement with North Korea, here.

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Sanctions against Russia have been extended by the Senate – a show of widespread bipartisan support – likely due to the hot button issue of Russian interference in the 2016 presidential election. However, European allies are concerned about the legislation and its impact on European companies in the energy sector.  Read more here.

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Scope of TSRA license regarding the exportation of medical supplies to Iran broadened by the U.S. Department of the Treasury Office of Foreign Assets Control
On December 22, 2016, the U.S. Department of the Treasury Office of Foreign Assets Control (OFAC) amended the rules surrounding the General License for the exportation of medical devices to Iran.  See 31 C.F.R. Section 560.530.  Prior to the recent change, OFAC had published a list of medical supplies and devices that were eligible for exportation to Iran.  The exportation of all medical devices not included on the list would require a Specific License from OFAC.

OFAC’s recent action changed this inclusionary list to an exclusionary one.  Put differently, OFAC has now authorized the exportation of all medical devices to Iran except for products contained on a new shorter List of Medical Devices Requiring Specific Authorization (PDF).

The items on the List of Medical Devices Requiring Specific Authorization include advanced diagnostic imaging equipment, oxygen generators, high-volume pumps, and a long list of laboratory equipment.

Burma Sanctions program ended by President Obama executive actionOn September 14th,  President Obama pledged to lift all of the economic sanctions against Myanmar or Burma. This was a broad regime-focused sanctions program that had been in place for almost two decades.

In May of 1997, President Bill Clinton issued an executive order declaring a national emergency with respect to the actions and policies of the military junta that was governing Burma, specifically related to the repression of the democratic opposition and related activities. This Burma Sanctions Program was one of the country-based sanctions programs, which means that the sanctions prohibited not just transactions with particular people, but transactions with the then-ruling military junta or Burma, generally speaking.

In this way, it is similar to the sanctions programs for Iran, Sudan, Syria, Cuba and North Korea, but different from the smart sanctions approach, which only targets specific individuals and entities. The Burma Sanctions have changed a lot over time and there have been a number of different executive orders which have been issued, including Executive Order 13047, which was issued by President Bill Clinton on May 28th of 1997, as well as the congressional laws Burmese Freedom and Democracy Act of 2003; an additional Executive Order 13310 on July 28, 2003; Executive Order 13448, which was issued on October 18, 2007; Executive Order 13464, which was issued on April 30, 2008; the Tom Lantos Block Burmese JADE Act of 2008, which was signed into law on July 29th of that year; Executive Order 13619, which was issued by President Barack Obama on July 11, 2012; Executive Order 13651, which was issued by President Barack Obama on August 6, 2013; and now Obama’s pledge to withhold the sanctions regarding Myanmar.

On September 14th, President Obama issued an Executive Order titled, “Termination of Emergency with Respect to the Situation in or in Relation to Cote d’Ivoire,” with respect to the situation in or in relation to Cote d’Ivoire or the Ivory Coast. This represents an official end to the Ivory Coast or Cote d’Ivoire Sanctions Program that has been implemented by the Office of Foreign Assets Controls since February 7, 2006, based on the issuance of the Executive Order 13396.

Background on the Ivory Coast Sanctions Program

Sanctions program against Ivory Coast lifted by President Obama executive order.
The Cote d’Ivoire Sanctions Program originated from President George W. Bush’s Executive Order 13396 declaring a national emergency to address the situation in or in relation to the Cote d’Ivoire, regarding the massacre of many civilians, widespread abuses of human rights, political violence and instability, and attacks by elements within the country against international peace-keeping forces that resulted in fatalities.

An OFAC lawyer discusses the enforcement trends of OFAC and the proper precaution all businesses should take to avoid consequences.Since the beginning of August, there have been three publicly released enforcement actions by the Office of Foreign Assets Control (OFAC), including two within the same week. These enforcement actions are showing that OFAC is taking a close look at two different things: 1) the constant updating and updated screening of names on one’s list when providing services to someone, and 2) taking the proper steps when engaging an activity that would be eligible for a license.

  1. Regularly screening your sanctions list.

On August 2, 2016, OFAC issued a finding a violation to Humana Incorporated, which is the parent company of Kanawha Insurance Company, for violations of the Foreign Narcotics Kingpin Sanctions Regulation. The Foreign Narcotics Kingpin Sanctions Regulations can be found in 31 CFR Part 598.