On July 14, President Trump issued an Executive Order pursuant to the Hong Kong Policy Act eliminating the separate status of Hong Kong and China under various provisions of U.S. law, including export controls, immigration, tax, and extradition, as well as providing for the implementation of recent Hong-Kong related sanctions authorities.

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Today, President Donald Trump signed into law the Hong Kong Autonomy Act (“HKAA”), authorizing the U.S. administration to impose blocking sanctions against individuals and entities (as well as visa bans in the case of individuals) determined to “materially contribute” to the erosion of Hong Kong’s autonomy.  The HKAA further authorizes secondary sanctions, including the imposition of blocking sanctions, against foreign financial institutions that knowingly conduct a significant transaction with foreign persons sanctioned under this authority.[1]
Continue Reading United States Enacts Additional Hong-Kong Related Sanctions; Impact Remains Unclear

On June 3, 2020, the International Chamber of the Paris Court of Appeal rejected an annulment application brought against an arbitral award rendered by a Paris-seated ICC arbitration tribunal. The ICC tribunal on December 27, 2018 rendered an award in favor of the Iranian Natural Gas Storage Company (“NGSC”), in a dispute arising out of

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 2020.

If you have any questions regarding the above, do not hesitate to contact fclaprevote@cgsh.com or tmuelleribold@cgsh.com.

On June 4, 2020, the U.S. Department of the Treasury, Office of Foreign Assets Control (OFAC) issued the Syria-Related Sanctions Regulations (SRSR).  Not to be confused with the pre-existing Syrian Sanctions Regulations found in 31 C.F.R. Part 542, the SRSR, which are found in 31 C.F.R. Part 569, are intended to

Even before the COVID-19 pandemic, the German Federal Ministry of Economics and Energy (Bundesministerium für Wirtschaft und EnergieBMWi), led by federal minister Peter Altmaier, announced a major revision of Germany’s foreign direct investment control regime (FDI Regime) to come into force in 2020, in what would become the third amendment of the FDI Regime since 2017. This announcement was made as part of the introduction of the BMWi’s “National Industry Strategy 2030”. The aim of this new industrial policy is to “protect and regain Germany’s commercial and technical expertise, competitiveness and industrial leadership at national, European and global level”.

Continue Reading Changes to the German Foreign Direct Investment Control Regime Take Shape Amid the COVID-19 Crisis

On May 15, 2020, the U.S. Department of Commerce, Bureau of Industry and Security (BIS) issued an interim final rule (the Interim Rule) amending the direct product rule under the Export Administration Regulations (EAR) to further restrict Huawei Technologies Co., Ltd. (Huawei) and its affiliates designated on the Entity List from receiving semiconductor and other products produced outside the United States using U.S.-origin software and technology.  The changes, which are effective immediately (but subject to two savings clauses), could have a significant impact on the ability of non-U.S. foundries that manufacture semiconductor products for Huawei and its affiliates (e.g., HiSilicon) using U.S.-origin software or technology to continue to do so (and could have a corresponding significant impact on the competitiveness of U.S. semiconductor manufacturing equipment and software).  BIS also extended the temporary general license (TGL) that authorizes certain activities subject to the EAR involving Huawei and its affiliates through August 13, 2020.[1]
Continue Reading BIS Expands Export Restrictions on Huawei, Extends Temporary General License

On April 20, OFAC issued COVID-related guidance indicating that it encourages those subject to its jurisdiction to contact the OFAC staff if they believe they will have difficulty meeting OFAC deadlines (whether reporting deadlines, responses to administrative subpoenas, or other matters).  OFAC also encouraged electronic submission of any communications.  In our experience, OFAC is still functioning at a relatively high level, remote operations notwithstanding, but the staff has also been flexible in responding to the challenges all institutions face.  As OFAC’s guidance and our own experience underline, open communication with the staff is very important.
Continue Reading OFAC Issues Guidance on COVID’s Impact on Compliance and Enforcement

In June of 2019, OFAC amended its Reporting, Procedures and Penalties Regulations (RPPR), apparently effecting a radical expansion of the obligation of non-financial institutions in the U.S. to report “rejected” transactions involving U.S.-sanctioned persons.  OFAC has long required financial institutions to report rejected financial transactions involving sanctioned persons.  (“Rejected” transactions involve persons who are not Specially Designated Nationals (SDNs) or other persons whose property within U.S. jurisdiction is blocked, but with whom transactions are nevertheless prohibited, such as private individuals and companies resident in Iran and not explicitly designated for sanctions.  U.S. persons may not execute these transactions but are not required to block and report any related assets that come within their control; to take the historical example of funds transfers, the payment is returned to the sender rather than being frozen in a blocked account.)  The amended reporting guidelines expanded that obligation from financial institutions to all U.S. persons and persons within the United States, defined the relevant transactions to include “transactions related to wire transfers, trade finance, securities, checks, foreign exchange, and goods or services,” and (as before) did not define “reject” at all.  If any person subject to U.S. jurisdiction does reject a transaction for goods or services (financial or otherwise) for sanctions reasons, it is now legally required to report that rejection within ten days.
Continue Reading New FAQs Provide Little Clarity on Expanded OFAC Reporting Obligations for Non-Financial Institutions