On August 19, 2022, the Department of the Treasury’s Office of Foreign Assets Control (OFAC) issued two Russia-related General Licenses (GL) authorizing certain limited activities with Russian financial institutions which have been blocked and designated on the Specially Designated Nationals (SDN) List.

Placement on the SDN List results in all property and interests in property of the designated party that are in the United States or in the possession or control of U.S. persons being blocked. In addition, 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. The below GLs authorize certain transactions which would otherwise be prohibited under OFAC sanctions.

OFAC has revised GL 38 which authorizes all transactions ordinarily incident and necessary for the processing of pension payments to U.S. persons via certain OFAC-blocked financial institutions. Revised GL 38A expands the scope of this license and now also authorizes the processing of such payment to non-U.S. persons not located in Russia via OFAC-blocked financial institutions.

OFAC has also issued GL 50 which authorizes all transactions ordinarily incident and necessary to (i) the closing of an account of an individual, wherever located, who is not a designated and blocked person (“the account holder”), held at certain OFAC-blocked financial institutions, and (ii) the unblocking and lump sum transfer of all remaining funds and other assets in the account to the account holder, including to an account of the account holder held at a non-blocked financial institution.

Certain dealings are specifically not authorized under these general licenses, and therefore they require close analysis.