Passport to Economic Sanctions

Your U.S. Economic Sanctions Roadmap – Key Concepts, Agencies, Jurisdictions and Roles – and Who to Contact for What

During this practical opening session, expert instructors will take you through the key agencies involved in U.S. sanctions implementation and enforcement and the evolving framework of U.S. Secondary Sanctions and Human Rights-related actions including:

• Basics of sanctions law: e.g., TWEA, IEEPA, Executive Orders, and Designations
  • Introduction to OFAC, BIS, DOJ, State Department, Congress and how they work together 
  • U.S. Sanctions Jurisdiction: Extra-Territoriality » What are Primary, Sectoral, and Secondary Sanctions? 
• Introduction to OFAC’s 50% Rule 
  • Key Licenses and Exemptions » Sources of Guidance: Alerts, FAQs, and Enforcement Actions 
  • Intersection of Economic Sanctions, Export Controls and ore National Security Areas 
• Secondary Sanctions 
  • Scope: Menu-based versus Designations 
  • Application in Practice 
  • Financial Institution Considerations
• Human Rights and Supply Chain Considerations 
  • Sanctions in Context: Import Controls, Export Controls, and Sanctions to Target Human Rights Violations and Abuses 
  • Human Rights-related Sanctions: e.g., Global Magnitsky, Burma, Belarus, Xinjiang, and Hong Kong 
• Economic Sanctions and Export Controls 
  • How economic sanctions and export controls interact-and their increasing interplay 
  • Key agencies responsible for implementing and enforcing export controls-and their coordination and overlap with OFAC, BIS, DOJ and more

RUSSIA: A Deep Dive into the Latest Russia Sanctions Compliance and Screening Requirements

Summary of Current Program: 

• Overview of framework for current Russian program 
  • Which authorities are implementing Russia-related restrictions? 
  • Comprehensive review of Russian sanctions evolution and what is on the horizon. 
• “Who” Based Restrictions
  • Asset freezing restrictions including primary targets (banks, oligarchs, politicians, defense industry) 
• “Where” Based Restrictions 
  • Embargoes on Ukrainian occupied territories occupied by Russia 
• “What” Based Restrictions 
  • Trade Controls: Export & Import Restrictions 
  • Professional Services Ban » Investment bans 
  • Capital market/ securities restrictions. 
  • Targeting of certain sectors in Russia (defense, energy and financial)

Key Compliance Issues & Predictions for the Next 6-12 Months:

• Ownership & Control Assessment
  • US 50% Rule
  • EU/UK Ownership & “Control” Analysis: How can you prove control? 
• Export Controls 
  • Rising expectations on financial institutions (FinCEN Advisory) 
  • Integration of export and import functions and use of HTS.
  • “Technical assistance” and related services controls 
  • Diversion 
• Enforcement 
  • Publicly identified actions to date 
  • Expected regulator pivot to investigation and enforcement as rules stabilize. 
  • Cross-border investigations and cooperation (including US-UK) 
• Where are we headed? 
  • One-way ratchet on restrictions with a long-time frame 
  • Designations / export controls / restricted services
  • Considerations for remaining in Russia. 
  • Lessons learned for exiting Russia-and the possible roadblocks

CHINA: Comprehensive Analysis of Recent OFAC Guidance on China Risk Mitigation for Your Operations – and the Impact of China’s Retaliatory Measures

• The Essentials of U.S. Sanctions on China
  • DPRK and Iran-related designations of Chinese entities
  • Use of Entity List 
  • Xinjiang and human rights-related designations, and the interplay with UFLPA 
  • CMIC sanctions 
  • FCC Covered List and government procurement bans 
  • Contrasting Biden v. Trump Administration policies 
  • Upcoming restrictions on certain investment in Chinese AI and other companies 
  • 2005 Section 311 designation of Banco Delta Asia
• Chinese Blocking Statute (passed January 2021) 
  • Reporting requirement on Chinese companies 
  • Prohibition on compliance with “foreign law” 
  • Private right of action 
  • Identification of “extraterritorial” laws status 
  • Pending identification of “extraterritorial” laws 
  • Potential for aggressive enforcement compared with the EU 
  • How to address balance compliance with Chinese laws and US sanctions 
• Chinese Retaliation 
  • China’s Anti-Foreign Sanctions Law (passed June 2021) 
  • Risk retaliatory measures for compliance with foreign sanctions in China 
  • Exposure to countersanctions by Beijing against persons or entities instigating or implementing sanctions 
  • Retaliation for U.S. and EU sanctions over Xinjiang and Hong Kong 
• Chinese Data Security Law (passed June 2021) 
  • New data security law, effective September 1, 2021, requiring all companies in China to classify data 
  • New rules regarding “critical information infrastructure.” 
  • Ambiguous classification and handling requirements 
  • How will these new rules be enforced? 
  • China’s Unreliable Entity List 
  • Chinese consumer backlash

A Complete Primer on EU and UK Sanctions-and the Similarities and Differences with U.S. Restrictions

This session will provide you with a complete guide to the EU and UK Sanctions landscapes-and their application to European, U.S. and other foreign-owned multinationals. The US has worked closely with the UK and Europe on sanctions implementation, however, there still remains many differences and nuances amongst all three sanctions regimes. 

Topics of discussion to include: 

• Demystifying EU/UK Sanctions Regimes: 
  • Asset Freezes and Travel Bans 
  • “Any Transaction” Prohibition 
  • Restrictions on SWIFT access for financial institutions 
  • Investment restrictions » Oil Price Cap 
  • Professional services ban 
  • 11th EU Sanctions Package 
• Key Differences across US, EU, and UK for Russia 
  • “Transactions” Prohibitions: US & EU 
  • Limited list-based sanctions: the “sectoral” sanctions program current 
• Examining EU Regulations and Member State implementation and enforcement 
• Review of UK sanctions and export controls – OFSI and DIT implementation 
• Comparing and contrasting EU, UK, and US sanctions

Deciphering Country-Specific Sanctions: A Roadmap to U.S. Sanctions on Iran, Cuba, Venezuela, Syria, North Korea, Afghanistan, Belarus

Iran

• Jurisdictional scope
• Impact of recent developments
• Evolution of the U.S. embargo since JCPOA withdrawal
• Other, overlapping sanctions: IRGC, SDGT, NPWMD, etc.
• Frequently used general licenses and their practical limitations
• Broad array of secondary sanctions authorities
• Section 13(r) of the Exchange Act: SEC reporting requirements for public companies

Cuba

•  More expansive jurisdictional scope than other programs
• Differences in exemptions (no travel exemption under TWEA) and civil penalties (TWEA’s statutory maximum penalties are lower)
• Broad prohibitions apply to all Cuban nationals
• General licenses allowing dealings with Cuban nationals permanently residing outside of Cuba

Venezuela

• The Government of Venezuela (GoV) and state-owned entities including PdVSA are blocked
• Various other sanctions apply to Venezuelan bonds, new debt, purchases of securities from the GoV, pledges of collateral by the GoV, and transfers of equity interests owned by the GoV
• Blocking sanctions have been imposed on persons operating in certain sectors
• Discussion of key general licenses, including broad authorizations for CITGO-related transactions and Chevron operations

Syria

• Government of Syria and state-owned entities are blocked
• Export embargo, ban on export of services and certain categories of investment
• Humanitarian licensing

North Korea

• Government of North Korea and state-owned entities are blocked
• Foreign subsidiaries of US financial institutions are prohibited from transacting with the
• Government of North Korea or certain North Korean SDNs: How does this play out in practice?
• Investment in, exports to, and imports from North Korea are prohibited
• “Secondary sanctions” risks
  

Afghanistan

• What sanctions continue in effect?
• General licenses authorizing certain humanitarian activity by NGOs and international organizations
• The scope of limits on fund transfers to the Taliban and the Haqqani Network, including in relation to authorized humanitarian activity

Belarus

• Overlap with Russia sanctions
• Increasing use of targeted SDN designations and coordination with the UK and EU
• Increased use of sanctions to respond to human rights violations
• Risk of SDN designation for companies in certain sectors
  

The Essentials to an Effective Global Sanctions Compliance Program: Lessons Learned from Key and Recent Enforcement Actions

Understanding sanctions enforcement is critical for developing and strengthening an effective global sanctions compliance program. Our experienced instructors will unpack the essentials of U.S. sanctions enforcement, including the decision to voluntarily disclose to OFAC, the potential consequences of an OFAC enforcement action, and key lessons from recent cases. 

• Recent Key Enforcement Actions and Lessons Learned
  • Geofencing and IP address blocking 
  • Counterparty screening, due diligence, and / or compliance procedures
  • Leveraging technological tools for sanctions compliance purposes. 
  • Preparing a voluntary self-disclosure. 
  • Remediation and corrective actions 
  • OFAC’s enforcement guidelines and penalty calculations 
  • Civil versus criminal enforcement / liability 
  • Supply chain due diligence » Parent and successor liability 
  • U.S. sanctions jurisdiction over non-U.S. persons 
  How Sanctions Enforcements and Disclosures Arise » Internal investigations and blocking or rejecting reports. 
  • Notices from other parties 
  • Responding to OFAC subpoenas and requests for information
  • Considerations for whether or not to make a voluntary self-disclosure
• Potential Enforcement Outcomes
  • No action letters, cautionary letters, finding of violations, settlements, penalty notices, and criminal referrals.
  • Public versus private dispositions
  • Sanctions enforcement as punishment and policy 

Hypothetical Exercises, Q & A and Review on the Do’s and Don’ts 
Toward solidifying your understanding of the enforcement process, the instructors will take you through a series of hypothetical scenarios to help you apply and understand voluntary self-disclosure best practices. At the end of this module, instructors will provide additional clarification and guidance, and take your questions.

How to Submit an Application to the OFAC Licensing Division: Practical Guidance for Preparing Your Submissions – and Minimizing the Risk of Delays and Denials

• How to Submit a Specific License Application for Transactional Requests 
  • The information necessary for OFAC to consider the application “complete.” 
  • Differences and similarities between a specific license application and a request for interpretive guidance on general licenses 
  • The role of an OFAC Statement of Licensing Policy or FAQs in a license application 
  • The interagency process – the roles of the State Department and/or Commerce Department in certain types of applications 
• How to Submit a License Application for the Release of Blocked Funds 
  • How does this type of license application differ from a Transactional Request? 
  • Types of information required for OFAC to process the application » What is the process for these types of applications? 
• Other Types of OFAC Licensing Communications 
  • General License Guidance Letters – what do these do? 
  • Denial Letters – what happens if your license application is denied 
• When and How to Contact OFAC 
  • Understanding the timing of getting an OFAC response 
  • The difference between a formal OFAC determination and the OFAC Compliance hotline

Practical Guidance for Working Effectively with OFAC and Review of Proficiency Exam

In advance of this last unit, participants will complete an assignment on various sanctions scenarios. The questions will be based on real-world case studies. During this last session, participants will share their responses to the assignment questions, followed by in-depth feedback from the expert instructors. In the first half of this session, faculty will discuss how to effectively work with OFAC, OFSI, and the EU Commission. Topics to be discussed include: 

• Understanding how OFAC, OFSI, and the EU Commission are structured. 
• The importance of FAQs 
• Reporting to OFAC, OFSI, and the EU Commission 
• Importance of Communication with regulators 
• How to best get your questions answered 

Award of “Passport to Proficiency” 
Participants who have completed all Modules will receive a certificate reflecting their proficiency in the essentials of Economic Sanctions