Key Notes:
- The ban is effective January 11, 2021.
- Executive Order 13959 bans U.S. persons from transacting in publicly traded securities or derivatives or similar securities of publicly traded Chinese companies designated by the U.S. Department of Defense as enabling Chinese military aims.
- OFAC has identified, and will continue to add, subsidiaries of the named companies, which will be subject to the same restrictions.
- Divestiture of securities is permitted until November 11, 2021 or 60 days after listing of the company, whichever comes last.
On November 12, 2020, President Trump issued Executive Order 13959, prohibiting U.S. persons from transacting in publicly traded securities or derivatives or similar securities of publicly traded Chinese companies designated by the U.S. Department of Defense as enabling Chinese military aims. The ban is effective January 11, 2021. Since issuance of the order, the DoD and the U.S. Department of the Treasury have added a number of companies to the list of designated entities released by the Office of Foreign Assets Control, and OFAC has prepared guidance in the form of a series of Frequently Asked Questions.