On March 31, 2022, Secretary of the Treasury Janet Yellen released a Determination expanding the scope of Section 1(a)(i) of Executive Order 14024 to include aerospace, electronics and marine sectors of the Russian economy as being within the scope of the Executive Order. This Executive Order has been relied upon extensively to implement sanctions against Russia since its invasion of Ukraine as a manner in which to designate and block property and assets of certain Russian persons and entities. Specifically, Section 1(a)(i) allows for the blocking of any person determined by the Treasury Secretary to “operate or have operated in the technology sector or the defense and related materiel sector of the Russian Federation economy, or any other sector of the Russian Federation economy as may be determined by the Secretary of the Treasury.” With this designation it is anticipated that the Department of the Treasury’s Office of Foreign Assets Control (OFAC) will begin designating and blocking additional Russian entities in the aerospace, marine, and electronics industry sectors.
In addition, OFAC designated 21 Russian entities and 13 individuals, including one of Russia’s largest exporters of microelectronics and chips and several Russian government malicious cyber actors to the Specially Designated Nationals (SDN) List. These designations also include entities which have been determined to be attempting to obfuscate Russian military and intelligence as the ultimate-end users and evade U.S. sanctions. Detailed information on these entities and persons is available here. All property and interests in property of the identified individuals and entities that are in the United States or in the possession or control of U.S. persons are blocked and must be reported to OFAC. In addition, any entities that are owned, directly or indirectly, 50% or more by one or more blocked persons are also blocked. All transactions by U.S. persons or within (or transiting) the United States that involve any property or interests in property of designated or otherwise blocked persons are prohibited unless authorized by a general or specific license issued by OFAC, or exempt.