On May 23, 2022, the U.S. Departments of State, the Treasury, Commerce, and Labor issued a joint advisory for U.S. businesses operating in Sudan. The advisory highlights the risks associated with conducting business with Sudan’s state-owned enterprises (“SOEs”), which are effectively controlled by the Sudanese military since its seizure of power on October 25, 2021. Among other things, the business advisory highlights the following risks:
- Gold Industry: The advisory warns U.S. businesses that the U.S. Department of Labor lists gold from Sudan as a good produced with child labor and urges businesses engaging in gold trade in Sudan or whose suppliers source gold from Sudan to adopt due diligence practices consistent with OECD Due Diligence Guidance, Gold Supplement.
- Sanctioned Parties: The advisory also highlights that certain individuals and entities in Sudan have been designated under various sanctions authorities, including the recent designation of the Central Reserve Police under Executive Order 13818, and advises businesses to employ a tailored risk-based approach to sanctions compliance by developing and updating their sanctions compliance policies and procedures.
- Arms, Military Equipment, and Related Activities: the Sudan business advisory highlights that there is a UN arms embargo on the supply of arms and related materiel and any related technical training or assistance in relation to actors operating in Darfur, and that the embargo was implemented by the U.S. Government in the International Traffic in Arms Regulations, which reflects a policy of denial for exports or imports of defense articles and services destined for or originating in Sudan, with certain exceptions.
- Human Rights Due Diligence: Finally, the business advisory document recommends that U.S. businesses conduct human rights due diligence based on publicly available guidance documents, including UN Guiding Principles on Business and Human Rights, and U.S. Department of Labor’s platform – Comply Chain: Business Tools for Labor Compliance – providing information about due diligence measures specific to forced labor and child labor in supply chains.