The Office of Foreign Assets Control of the U.S. Treasury Department recently issued a series of instructive press releases regarding enforcement actions taken against several companies. The decision to publicize these enforcement actions could signal a more activist and expansionist approach to sanctions enforcement matters and may evidence a broadening of OFAC’s enforcement priorities as the long run of enforcement against financial institutions begins to wind down. The actions demonstrate a focus on acquisition due diligence and conduct by overseas entities, and in particular on aggressive action against U.S. companies who fail to terminate sanctioned business by their newly acquired overseas subsidiaries; indeed, in a number of these cases OFAC took enforcement action despite the fact that the U.S. acquiror explicitly directed the termination of the sanctioned business, was deceived by officials of the acquired entity, and voluntarily self-reported the violation after discovering it. OFAC has also begun to spell out, in enforcement actions, the elements of sanctions compliance programs it imposes on violators (and, presumably, would consider a benchmark for other companies). Continue Reading OFAC Takes Aggressive Enforcement Action in Connection With M&A Transactions and Spells Out Compliance Expectations
On March 4, 2019, Secretary Pompeo extended the suspension of actions under Title III of the Helms-Burton Act for another 30 days, until April 17, 2019. We have updated our memorandum on the potential impact of a revival of Title III accordingly.
On January 16, 2019, U.S. Secretary of State Mike Pompeo announced that the administration would issue a limited, 45 day extension of the suspension of Title III of the Cuban Liberty and Democratic Solidarity (Libertad) Act of 1996 (known as the “Helms Burton Act”).
If this limited suspension is not renewed on or before March 17, 2019, it will be possible for plaintiffs to assert the cause of action authorized by Title III of the Helms Burton Act. That cause of action has been suspended for successive six month periods by every presidential administration since the law was enacted in 1996. Continue Reading Potential End of Suspension of Title III of the Helms-Burton Act: Authorization of Claims Under U.S. Law for “Trafficking” in Certain Cuban Properties
After brisk movement through the EU legislative process, the proposed EU Regulation on Foreign Direct Investment Screening (the “Regulation”) was approved by the European Parliament on February 14, 2019. This development comes amidst a global sprint to strengthen and establish foreign direct investment laws, including in France, UK, Germany, and Hungary, as well as the US and China.
Although individual Member States retain their authority to screen (i.e., investigate, condition, prohibit, or unwind) foreign direct investments (“FDI”), the Regulation introduces and formalizes numerous procedures and criteria for cooperation among Member States and with the Commission. Specifically, it sets out an EU-wide framework on this process and grants competence to the European Commission (“EC”) to intervene with an official opinion on the grounds of “public order and security”. Additionally, it provides an official forum for Member States to weigh in and potentially affect the course of foreign investment activities across the European Union. Continue Reading New EU-wide Foreign Direct Investment Screening System Approved
OFAC has clarified that, pursuant to the terms of General License 14 and General License 16, it still expects all U.S. persons who participated in transactions with United Company Rusal PLC, EN+ Group PLC, JSC EuroSibEnergo, or their subsidiaries in reliance on the general licenses during the period when these entities were SDNs (April 6, 2018 through January 27, 2019) to file reports with OFAC. The delisting of these entities does not terminate the reporting requirement. Reports are due Monday, February 11, 2019, and must include “a comprehensive, detailed report of each transaction, including the names and addresses of parties involved, the type and scope of activities conducted, and the dates on which the activities occurred.” Reports are to be filed with the Office of Foreign Assets Control, Office of Compliance and Enforcement, U.S. Department of the Treasury, 1500 Pennsylvania Avenue N.W., Freedman’s Bank Building, Washington, DC 20220, or via email to OFACReport@treasury.gov.
Please contact Paul Marquardt or Sameer Jaywant with any questions.
This Trade Summary provides an overview of WTO dispute settlement decisions and panel activities, and EU decisions and measures on commercial policy, customs policy and external relations, for the fourth quarter of 2018.
On November 14, 2018, almost a year and a half after the British public voted to exit the EU, the UK and EU reached agreement on the terms of separation manifested in a draft Withdrawal Agreement. This draft text updates an earlier version published in March 2018. Subsequently, on November 22, the EU and UK published the accompanying draft Political Declaration that sets out key principles of the future relationship. On November 25, the European Council endorsed these two texts. This post summarizes the key outcomes with respect to trade in goods, the continued applicability of EU law and European Court of Justice jurisdiction, and dispute settlement during the transition period, as well as the framework for the EU and UK’s future relationship. Continue Reading The EU and UK Agree on Arrangements for Brexit Transition Period and Future Relationship Framework
This Trade Summary provides an overview of WTO dispute settlement decisions and panel activities, and EU decisions and measures on commercial policy, customs policy and external relations, for the third quarter of 2018.
On September 13, 2018, the Taxation (Cross-border Trade) Bill received Royal Assent, formalizing its application into UK law as an Act of Parliament. This date marks less than one year since the Cross-border Trade Bill, also referred to as the “Customs Bill”, was first brought before the House of Commons. The initial scope of the Customs Bill, as well as the accompanying Trade Bill, was discussed in a previous blog post. Continue Reading UK Parliament Passes Trade and Customs Legislation in Shadow of Brexit Uncertainty
This Trade Summary provides an overview of WTO dispute settlement decisions and panel activities, and EU decisions and measures on commercial policy, customs policy and external relations, for the second quarter of 2018.
This Trade Summary provides an overview of WTO dispute settlement decisions and panel activities, and EU decisions and measures on commercial policy, customs policy and external relations, for the first quarter of 2018.