Navigating Economic Sanctions Successfully

Navigating Economic Sanctions Successfully

Buffalo World Trade Association

Buffalo, New YorkJanuary 15, 2014

Law Offices of Jon P. Yormick Co. LPAAn International Law PracticeAttorney Advertising

Disclaimer

• The information provided is believed to be accurate as of the date of the presentation, but is subject to change without notice

• This presentation is designed for informational purposes only and is not intended to be, nor should it be deemed, specific legal advice. If such advice is required, please consult with qualified legal counsel

U.S. Economic Sanctions

Office of Foreign Assets Control (OFAC)

-Administers, enforces economic/trade sanctions againstforeign governments, government officials,

persons/entitiesand placed on the SDN List

-Financial expertise – blocking/freezing assets; title remains with sanctioned target

-Broad prohibitions on transfers/transactions

SDN List• Specially Designated Nationals List – updated 10

Jan. 2014

http://www.treasury.gov/ofac/downloads/t11sdn.pdf

• Individuals and companies owned/controlled by or acting for/on behalf of targeted countries

• Individuals, groups, and entities, (terrorists and narco- traffickers)

• Assets are blocked and U.S. persons are generally prohibited from dealing with SDNs




SDN List Entrants• CARIBBEAN EXPORT ENTERPRISE (a.k.a. CARIBEX; a.k.a. EMPRESA

CUBANA DE PESCADOS Y MARISCOS), Paris, France; Milan, Italy; Moscow, Russia; Madrid, Spain; Cologne, Germany; Downsview, Ontario, Canada; Tokyo, Japan [CUBA]

• ASH TRADING, INC., 14420 NW 16TH St., Pembroke Pines, FL 33028; US FEIN 65-1128351; Business Registration Document #P01000078571 (United States) [SDNT]

• ASSA (a.k.a. ASSA CORP.), New York, NY; Additional Sanctions Information - Subject to Secondary Sanctions; Tax ID No. 1368932 (United States) [NPWMD] [IFSR]

• BEIJING ALITE TECHNOLOGIES CO., LTD. (a.k.a. ALCO; a.k.a. BEIJING HAILI LIANHE KEJI YOUXIAN GONGSI), 12A Beisanhuan Zhong Road, P.O. Box 3042, Beijing, China; Additional Sanctions Information - Subject to Secondary Sanctions; and all other locations worldwide [NPWMD] [IFSR]

• AA ENERGY FZCO, United Arab Emirates; Additional Sanctions Information - Subject to Secondary Sanctions [IRAN].

OFAC Licensing

• Specific v. General License – authorization to engage in transactions otherwise prohibited

• OFAC License Application Page http://www.treasury.gov/resource-center/sanctions/Pages/licensing.aspx

– Trade Sanctions Reform and Export Enhancement Act of 2000 (TSRA) – agricultural commodities, medicine, or medical devices

– Cuba travel

– Blocked funds release – U.S. financial institution

– “Catchall” - Transactional

http://www.treasury.gov/resource-center/sanctions/Pages/licensing.aspx



Specific License

• OFAC License Application Page http://www.treasury.gov/resource-center/sanctions/Pages/licensing.aspx

– Trade Sanctions Reform and Export Enhancement Act of 2000 (TSRA) – export agricultural commodities, medicine, or medical devices to Iran and Sudan

– Cuba travel

– Blocked funds release – U.S. financial institution

– “Catchall” – Transactional or guidance



TSRA License

• EAR99 only - Commodity Classification may be required

• Online form - be prepared to disclose third-party information:

“Please complete the requested information for all applicants, consultants, customs brokers, forwarding agents, intermediaries, manufacturers, shippers, and/or suppliers involved in the export process, including entities located in third countries (outside the U.S. or the sanctioned country)”

TSRA License Transformation

• OFAC and BIS Lists - Iranian Transactions and Sanctions Regulations, 31 CFR Part 560 (ITSR)

– OFAC List of “Basic Medical Supplies” – 25 July 2013

• General equipment (syringes, stethoscopes, wheelchairs, hospital beds, cribs, bassinets, medical carts, etc.)

• Apparel Laboratory

• Dental Sterilization

• PT/OT Surgery


• BIS List of EAR 99 Medical Devices List – serves as CCAT with product “clearly shown” on list

– Equipment & Supplies – training (other than CPR), oxygen apparatus

– Cardiology – pacemaker

– Dental – dentures, crowns

– Radiology – CT, PET, MRI, X-ray

– Devices with electronic components – CCATS required

• Medicines – Generally, EAR99 – No CCATS required

• Ag commodities – No CCATS required (except fertilizers, Western red cedar, live horses)

• Food –broadly defined; Greek yogurt! No Blue!


Alchemy – General License program

Challenge #1: Finding buyers Gold Key Service? Options?


Canadian Strategy?

- Iran Threat Reduction and Syria Human Rights Act of 2012 (ITRA) – extends sanctions to non-US subs

But…

- OFAC Guidance on the Sale of Food, Agricultural Commodities, Medicine, and Medical Devices by Non-U.S. Persons to Iran – 25 July 2013

- Banks and medical suppliers: “…these sales to Iran do not trigger sanctions under U.S. law.”


But…29 May 2013 – amendments to Canada Special Economic Measures (Iran) Regulations. Persons in Canada and Canadians outside of Canada:

-prohibited from exporting, selling, supplying, or shipping goods … to Iran or to a person for the purposes of carrying on business in or operated from Iran


• Challenge #2: Payment

OFAC Civil Penalty Settlements since 2011

• JPMorgan Chase

• ING

• Standard Charter

• HSBC

• RBS

Last Words on Iran Sanctions

Stay tuned…

Thank you

Jon P. YormickAttorney and Counsellor at Law

Law Offices of Jon P. Yormick Co. LPA

[email protected]

Toll Free: +1.866.967.6425

Mobile: +1.216.269.5138

Buffalo | Chihuahua, Mexico† |Cleveland†Affiliate office

Navigating Economic Sanctions Successfully

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