On August 2, 2022, the Department of the Treasury’s Office of Foreign Assets Control (OFAC) added further Russian individuals, entities and vessels to its Specially Designated Nationals (SDN) List.  The designations include numerous Russian individuals connected to Russia President Vladimir Putin, as well as multinational companies Investitsionnaya Kompaniya MMK-FINANS (an investment and financial copany) and MMK Metalurji Sanayi Ticaret Ve Liman Isletmeciligi Anonim Sirketi (aka MMK Metalurji; a steel products manufacturer).  OFAC also designated Joint Stock Company Promising Industrial and Infrastructure Technologies for reportedly attempting to facility and evade U.S. sanctions on the Russian Direct Investment Fund.

Additional identifying information on these individuals and entities sanctioned is available 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.

In connection with these sanctions, OFAC has issued several revised and new Russia-related General Licenses (GL):

  • GL 40B authorizes transactions ordinarily incident and necessary to the provision, exportation, or reexportation of goods, technology, or services to ensure the safety of civil aviation for certain blocked entities listed in an annex to the GL and including UAC, Irkut and other related companies.  Use of this GL is restricted to aircraft registered in a jurisdiction solely outside of Russia and for goods, technology, or services for use on aircraft operated solely for civil aviation purposes.  This revised GL modifies the list of entities in an attached Annex.
  • GL 43A authorizes, until August 31, 2022, transactions that are ordinarily incident and necessary for the divestment or transfer of debt or equity purchased prior to June 2, 2022, and wind down of derivative contracts entered into before June 2, 2022, involving, Public Joint Stock Company Severstal or Nord Gold PLC.  This revised GL allows U.S. financial institutions to unblock covered debt or equity that was blocked on or after June 2, 2022 but before June 28, 2022, provided that the unblocked covered debt or equity is solely used to effect transactions authorized by this GL.
  • GL 47A authorizes transactions ordinarily incident and necessary to wind down any transaction involving six of the newly designated Russian entities, or any entities owned, directly or indirectly, by 50 percent or greater interest, until September 1, 2022.
  • GL 48A authorizes the divestment or transfer of debt or equity and the wind down of related derivative contracts in two designated entities, or any entities owned, directly or indirectly, by 50 percent or greater interest, until October 3, 2022.
  • GL 49 authorizes transactions ordinarily incident and necessary to wind down any transaction involving MMK Metalurji or any entity in which it owns, directly or indirectly, a 50 percent or greater interest, until January 31, 2023.

 

Photo of Scott E. Diamond** Scott E. Diamond**

Scott is a senior policy advisor with more than 25 years’ experience with the legislative and regulatory processes involved in international trade policy, remedies and enforcement. This includes working with clients on matters involving export controls, economic sanctions, human rights and forced labor…

Scott is a senior policy advisor with more than 25 years’ experience with the legislative and regulatory processes involved in international trade policy, remedies and enforcement. This includes working with clients on matters involving export controls, economic sanctions, human rights and forced labor compliance, corporate anti-boycott and antibribery compliance, national security investigations, and foreign direct investment in the United States.

**Not licensed to practice law.

Photo of Samir D. Varma Samir D. Varma

Samir advises multinational corporations on export controls, economic sanctions and customs, and counsels individuals and corporations on the Foreign Corrupt Practices Act (FCPA) and other anti-corruption laws. He represents clients in enforcement actions before U.S. regulatory agencies and conducts corporate internal investigations.

Photo of Francesca M.S. Guerrero Francesca M.S. Guerrero

Francesca counsels clients on compliance with export controls, sanctions, import regulations, human rights and forced labor, and the FCPA and antibribery laws. She works closely with companies to develop tailored compliance programs that fit their specific needs, and routinely advises clients on some…

Francesca counsels clients on compliance with export controls, sanctions, import regulations, human rights and forced labor, and the FCPA and antibribery laws. She works closely with companies to develop tailored compliance programs that fit their specific needs, and routinely advises clients on some of their most challenging international transactions, involving dealings in high-risk jurisdictions or with high-risk counterparties. Francesca also counsels companies through all phases of internal investigations of potential trade and antibribery violations and represents companies across industries before related government agencies.