On June 2, 2022, the Department of the Treasury’s Office of Foreign Assets Control (OFAC) designated and blocked numerous additional Russian and related entities that are “key networks” relied upon by President Vladimir Putin and other Russian elites “to attempt to hide and move money and anonymously make use of luxury assets around the globe.” Notable among the designated entities are: (i) Severgroup (an investment company with holdings in metallurgy, engineering, mining, banking, technology, media and finance); (ii) PJSC Severstal (a company operating in the steel and mining industry); (iii) Nord Gold PLC (a gold producing subsidiary of Severstal with operations in Russia, Africa, South America, and North America); and (iv) Limited Liability Company Algoritm (a Russian technology, media, and advertising company).
Also added to the SDN List were additional Russian government ministers as well as the presidents of United Aircraft Corporation and Severgroup. The OFAC designation also include several yachts, aircraft and a helicopter – and related operating entities – with ownership ties or interests to President Putin or the government of Russia.
Detailed identifying information on these entities can be found here. All property and interests in property of these newly designated SDN List 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.
Russia-Related General Licenses
OFAC has revised General License (GL) 25B authorizing certain transactions related to telecommunications and Internet-based communications to specifically exclude LLC Algoritm. The following new Russia-related GLs have been issued:
- GL 36 – authorizes, until August 31, 2022, all transactions ordinarily incident and necessary to the wind-down of transactions involving JSC Severstal.
- GL 37 – authorizes, until July 1, 2022, all transactions ordinarily incident and necessary to the wind-down of transactions involving Nord Gold PLC.
- GL 38 – authorizes all transactions ordinarily incident and necessary for the processing of pension payments to U.S. persons via certain OFAC-blocked financial institutions.