More U.S. Trade Sanctions & Restrictions Against Ukraine’s Crimea Region
International Trade & Customs Update
Date: January 07, 2015
On December 19, 2014, President Obama issued Executive Order 13685 to further address the Russian occupation of the Crimea region of Ukraine. The order adds new prohibitions to the existing Ukraine-related sanctions, focusing on individuals, entities and activities in Crimea itself. In furtherance of the order, the Treasury Department’s Office of Foreign Assets Control (OFAC) issued two related general licenses and added several individuals to its Specially Designated Nationals (SDN) blocked party list.
Executive Order 13685
The order prohibits:
- New investment by U.S. persons in occupied Crimea
- The importation of goods, services or technology into the United States from Crimea
- The exportation, re-exportation, sale or supply of goods, services or technology from the United States or by a U.S. person to Crimea
- The facilitation of any such transactions
Further, the order authorizes the Treasury Department to block the property or interests in property of individuals or entities determined:
- To operate in the Crimea region of Ukraine
- To be a leader of an entity operating in the Crimea region of Ukraine
- To be owned or controlled by, or to have acted or purported to act for or on behalf of, directly or indirectly, any person who is sanctioned pursuant to the order
- To have materially assisted, sponsored or provided financial, material or technological support for, or goods or services to or in support of, any person sanctioned under the order
Finally, the order suspends entry into the United States of any foreign person determined to meet one or more of these criteria.
OFAC General License No. 4
Simultaneous to the release of the order, OFAC issued Ukraine-related General License No. 4, which authorizes exports or reexports of certain agricultural commodities, medicine, medical supplies and replacement parts for medical supplies to Crimea, and related transactions (e.g., shipping arrangements, insurance, financing, etc.). The license specifically excludes exports or reexports to military or law enforcement purchasers or importers, or to SDNs.
In addition, this general license excludes items that are designated and controlled under the U.S. Munitions List.
OFAC General License No. 5
General License No. 5, issued by OFAC on December 30, 2014, provides for a “wind-down” period for certain transactions and activities otherwise prohibited by Executive Order 13685. This general license allows:
- U.S. persons to divest their share of ownership in any pre-December 20, 2014 investments located in Crimea
- The winding down of operations, contracts or other agreements in effect before December 20, 2014 involving exports, reexports, sale or supply of goods, services or technology to, or imports from, Crimea
All such wind-down activities must be completed no later than February 1, 2015. Within 10 business days of concluding these activities U.S. persons must submit a report to OFAC detailing the scope of the activities and parties involved.
Additions to SDN List
Pursuant to Executive Order 13660, OFAC also added 24 Ukrainian and Russian-backed separatists or militias to its SDN list:
- ANTYUFEYEV, Vladimir
- BEREZIN, Fedor
- BEZLER, Igor Nikolayevich
- DONBASS PEOPLE’S MILITIA
- GUBAREV, Pavel
- KARYAKIN, Alexei Vyacheslavovich
- KHRYAKOV, Alexander
- KOZITSYN, Nikolai
- MALOFEYEV, Konstantin
- MARSHALL CAPITAL PARTNERS
- MOZGOVOY, Aleksey
- NEKLYUDOV, Dmitry Sergeyevich
- NIGHT WOLVES
- NOVOROSSIYA PARTY
- PLOTNITSKY, Igor Venediktovich
- POKLONSKAYA, Natalia Vladimirovna
- PROFAKTOR, Tov
- RUDENKO, Miroslav Vladimirovich
- SAVCHENKO, Petr
- SOUTH-EAST MOVEMENT
- TSARYOV, Oleh Anatolievich
- ZAKHARCHENKO, Alexander
- ZALDOSTANOV, Aleksandr
As with other SDNs, the blocked party prohibitions apply to any entity owned or controlled by these newly listed individuals.
FOR MORE INFORMATION
Thompson Hine will continue to monitor the situation and report on any further regulations issued by OFAC and any other activity on sanctions involving Ukraine and Russia. If you have questions, please contact any of these members of the firm’s International Trade & Customs group:
James A. Losey
Samir D. Varma
Scott E. Diamond
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