On September 20, 2017, President Trump issued Executive Order 13810, imposing additional sanctions against North Korea.  Most notably, the new Executive Order provides for a “secondary sanctions” regime, threatening to impose U.S. sanctions against persons engaging in targeted transactions (whether or not they have any connection to the United States). Continue Reading United States Imposes Secondary Sanctions on Dealings with North Korea

On September 6, 2017, Belgium requested an opinion from the European Court of Justice (“ECJ”) on whether the investment protection rules set out in Chapter Eight of the EU-Canada Comprehensive Economic and Trade Agreement (“CETA”) conform to EU Treaties. This request stems from the last-minute deal between Belgium and its regional governments on October 27, 2016, which essentially sought to appease Wallonia’s concerns regarding investor protection and the new Investment Court System (“ICS”) and unblocking domestic opposition to the signing of CETA.

Continue Reading Belgium Requests Opinion on Legality of Investment Court System in CETA

On August 25, 2017, President Trump issued an Executive Order severely restricting transactions in debt and equity of the Government of Venezuela and of state-owned entities; including Petroleos de Venezuela; S.A. (PdVSA). Simultaneously with the Executive Order; OFAC issued a number of general licenses and Frequently Asked Questions relating to the new sanctions. These new actions build on sanctions targeting Venezuelan officials; discussed here; and continue the trend toward targeted “bespoke” sanctions short of full blocking of all transactions with a targeted regime or country.

The new sanctions:

  • Prohibit dealings in existing debt of the Government of Venezuela (and its controlled entities) by U.S. persons or within U.S. jurisdiction; subject to an extensive list of exceptions for specified issuances;
  • Prohibit all dealings by U.S. persons or within U.S. jurisdiction in new debt of the Government of Venezuela with a duration of longer than 30 days and of PdVSA with a duration of longer than 90 days; or new equity of any state-controlled entity;
  • Bar the purchase of securities from the Government of Venezuela within U.S. jurisdiction; other than permitted new debt; and
  • Bar all distributions of profits and earnings within U.S. jurisdiction to the Government of Venezuela by state-owned entities.

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On July 30, 2017, new Federal Law No. 165-FZ of July 18, 2017 entered into effect, introducing amendments (the “Amendments”) to Federal Law No. 160-FZ “On Foreign Investments in the Russian Federation” of July 9, 1999 and Federal Law No. 57-FZ “On the Order of Accomplishing Foreign Investment in Entities Having Strategic Importance for Procuring State Defence and Security” of April 29, 2008 (the “FSIL”). The Amendments, among other things, granted the Government of the Russian Federation a discretionary power to decide whether a transaction by a foreign investor in respect of any business entity incorporated in Russia is subject to a prior governmental control in accordance with the procedure set forth by the FSIL, even if such transaction does not involve any strategically important Russian entity. Significant changes were also introduced into the FSIL. The alert memorandum summarizes the key provisions of the Amendments.

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Background

On August 2, 2017, President Donald Trump signed a bill imposing new sanctions on Russia. Days earlier, the proposed legislation sparked a vigorous reaction in the European Union.

On July 26, 2017, European Commission President Jean-Claude Juncker warned of “unintended unilateral effects that impact the EU’s energy security interests”. In the same vein, the French government opined that the extra-territorial reach of the text appears to breach international law. The German and Austrian governments also issued a joint statement disapproving of the proposal’s encroachment into European energy supply matters. Continue Reading EU Reacts to Impact of Russia Sanctions Bill on European Energy Investments

On July 31, OFAC designated Venezuelan President Nicolas Maduro Moros as a “Specially Designated National” (“SDN”) blocking all of his assets and prohibiting any transaction in which he has an interest within U.S. jurisdiction. Last week, on July 26, OFAC designated 13 other current and former Venezuelan officials as SDNs, including Rocco Albisinni Serrano, who is the President of CENCOEX (the Venezuelan foreign exchange authority), and Simon Alejandro Zerpa Delgado, who is the Vice President of Finance for PDVSA and the President of Venezuela’s Economic and Social Development Bank (“BANDES”), and the President of Venezuela’s National Development Fund (“FONDEN”). There have been rumors that the United States was considering restricting oil sales from Venezuela, but at the moment no such sanctions have been imposed. Continue Reading OFAC Sanctions Venezuelan Officials

On July ­­25, 2017, the United States House adopted H.R. 3364, the “Countering America’s Adversaries Through Sanctions Act” (“CAATS”), a compromise measure incorporating both House and Senate sanctions proposals.  The vote was 419-3.  CAATS was approved by the Senate on July 27, 2017 (the vote was 98-2).  It now awaits signature by President Trump (who in any event appears to lack sufficient support to uphold a veto).

Continue Reading Congress Reaches Agreement on New Sanctions against Russia, North Korea, and Iran

On July 18, the State Department published a notice that Secretary Tillerson has certified that Iran remains in compliance with its obligations under the 2015 Joint Comprehensive Plan of Action (“JCPOA”), pursuant to which Iran agreed to restrictions on its nuclear program in return for sanctions relief (see our 2015 and 2016 memoranda).  Recertification of compliance is required every 90 days under the Iran Nuclear Agreement Review Act of 2015.  Despite President Trump’s criticism of the JCPOA, this is his Administration’s second certification of compliance.

As with the prior certification, the State Department’s announcement notes that the Administration is reviewing the suspension of sanctions pursuant to the JCPOA.  The announcement also notes that the State Department and OFAC today designated an additional 18 Iranian entities and individuals for activities related to proliferation, ballistic missile development, support of the Iranian military and IRGC, and transnational criminal organizations; all of these sanctions authorities were unaffected by the JCPOA.

The next certification is due in mid-October.