President Biden Expands U.S. Sanctions on Russia by Authorizing Additional Prohibitions on Imports of Russian Seafood and Diamonds

On December 22, 2023, President Joseph Biden amended, among other things, Executive Order (EO) 14068, by additionally authorizing the prohibition on the importation and entry into the United States, including a foreign trade zone located in the United States, of the following products of Russian Federation origin: fish, seafood, and preparations thereof, as well as diamonds. The scope of this prohibition includes such products that were mined, extracted, produced, or manufactured wholly or in part in the Russian Federation, or harvested in waters under the jurisdiction of the Russian Federation or by Russia-flagged vessels, notwithstanding whether such products have been incorporated or substantially transformed into other products outside of the Russian Federation.

It is important to note that this amendment authorizes the Department of the Treasury via the Office of Foreign Assets Control (OFAC) to prohibit the importation of products that have been processed or substantially transformed in third countries regarding Russian seafood and diamond products. So items may be of a third country of origin for import purposes, but still be captured within the scope of this ban. This EO effectively amends an earlier Executive Order dated March 11, 2022 that did not restrict seafood imports that were processed outside of Russia and allowed Russian rough and polished diamonds to enter the country if they were “substantially transformed” elsewhere. See Update of March 14, 2022.

Seafood Imports

Accordingly, OFAC has issued a Determination Pursuant to EO 14068, that prohibits the importation following categories of Russian fish, seafood, and preparations thereof: salmon, cod, pollock, and crab. In FAQ 1157, OFAC provides further clarifying information on the scope of these categories by setting forth multiple Harmonized Tariff Schedule of the United States (HTSUS) subheadings that are applicable.

These import restrictions are effective as of December 22, 2023, except to the extent provided by law, or unless licensed or otherwise authorized by OFAC. However, OFAC has issued Russia-related General License (GL) 83, authorizing certain transactions that are ordinarily incident and necessary to the importation into the United States of seafood derivative products, pursuant to written contracts or written agreements entered into prior to December 22, 2023 until 12:01 a.m. eastern standard time, February 21, 2024. In FAQ 1156, OFAC also clarifies that individuals and entities may also find new buyers or re-direct such shipments to other countries, as OFAC seafood determination “does not prohibit U.S. persons from engaging in transactions to sell or re-direct shipments outside the United States that were previously destined for the United States.”

Diamond Imports

In amending EO 14068, the White House noted in a Fact Sheet that “[i]n the coming months, the United States and our partners intend to introduce import restrictions on certain diamonds mined, processed, or produced in Russia, building on an existing U.S. ban on the importation of Russian-origin diamonds. Today’s E.O. amends Executive Order 14068 to provide the authority to ban, following a determination from appropriate U.S. departments and agencies, the importation of certain products mined, extracted, produced, or manufactured wholly or in part in Russia, even if these products are then transformed in a third country.”

While the amended EO now authorizes the prohibition of imports of Russian diamonds processed in third countries, OFAC has not yet issued any implementing determination. OFAC has noted that it intends to do so “in the near term” and that such actions will be in support of commitments made in the G7 Leaders’ Statement of December 6, 2023. However, the amended EO, does define the term” diamond” to include “any diamonds classifiable under subheadings 7102.10, 7102.31, and 7102.39” of the HTSUS and “under any other subheadings of the Harmonized Tariff Schedule of the United States specified in determinations made” by the Department of the Treasury.