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Thompson Hine LLP, a full-service business law firm with approximately 400 lawyers in 11 offices, was ranked number 1 in the category “Most innovative North American law firms: New working models” by The Financial Times and was 1 of 7 firms shortlisted for The American Lawyer’s inaugural Legal Services Innovation Award. The firm has been recognized by the National Law Journal as a Legal Technology Trailblazer and featured by Bloomberg for its innovative service delivery models, which drive accuracy and predictability. The firm’s commitment to innovation is embodied in Thompson Hine SmartPaTHTM – a smarter way to work – predictable, efficient and aligned with client goals. For more information, please visit ThompsonHine.com and ThompsonHine.com/SmartPaTH.

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The U.S. Department of the Treasury&rsquo;s Office of Foreign Assets Control (OFAC) announced&nbsp;that it has issued&nbsp;<a href="https://home.treasury.gov/system/files/126/venezuela_gl5e.pdf" target="_blank" rel="noopener noreferrer">General License (GL) 5E</a> (Authorizing Certain Transactions Related to the Petr&oacute;leos de Venezuela, S.A. 2020 8.5 Percent Bond on or After January 19, 2021), which continues to delay U.S. persons&rsquo; ability to enforce bondholder rights to the CITGO shares serving as collateral for the Petr&oacute;leos de Venezuela, S.A. (PdVSA) 2020 8.5% bond until on or after January 19, 2021. Effective October 6, 2020, this GL 5E replaces GL 5D. Additionally, OFAC modified <a href="https://home.treasury.gov/policy-issues/financial-sanctions/faqs/595" target="_blank" rel="noopener noreferrer">frequently asked question #595</a>&nbsp;to address the scope of GL 5E.
On May 21, 2018, President Donald Trump issued <a href="https://www.treasury.gov/resource-center/sanctions/Programs/Documents/venezuela_eo_13835.pdf" target="_blank" rel="noopener noreferrer">Executive Order (EO) 13835</a> which, among other things, prohibits U.S. persons from engaging in transactions related to the sale, transfer, assignment or pledging as collateral by the Venezuelan government of any equity interest in an entity owned 50% or more by the Venezuelan government. Thereafter, on July 19, 2018, OFAC issued <a href="https://www.treasury.gov/resource-center/sanctions/Programs/Documents/venezuela_gl5.pdf" target="_blank" rel="noopener noreferrer">GL 5</a>, which removed E.O. 13835 as an obstacle to holders of the PdVSA 2020 8.5% bond from gaining access to their collateral.
Starting in January 2019, however, Trump continued expanding the sanctions targeting PdVSA (see&nbsp;<a href="https://www.trumpandtrade.com/2019/01/new-sanctions-imposed-venezuela-include-pdvsa-eight-new-ofac-general-licenses-released/#more-2393">Update of January 19, 2019</a>). Eventually, on October 29, 2019, GL 5 was replaced and superseded by GL 5A (and eventually 5B, 5C, and most recently, 5D), which delayed the effective date of GL 5&rsquo;s authorizations relating until October 20, 2020 (see <a href="https://www.thompsonhinesmartrade.com/2020/07/ofac-issues-license-delaying-pdvsa-2020-8-5-bond-related-authorizations/">Update of July 16, 2020</a>). The most recent version, GL 5E, again delays the effective date of the GL 5 authorizations to January 19, 2021.
Between October 24, 2019 and January 19, 2021, U.S. persons are prohibited from engaging in any transactions related to the sale or transfer of CITGO shares in connection with the PdVSA 2020 8.5%, unless specifically authorized by OFAC. In the modified FAQ 595, OFAC notes a favorable licensing policy toward those seeking to apply for a specific license in an effort to reach an agreement on proposals to &ldquo;restructure or refinance payments due to the holders of the PdVSA 2020 8.5 percent bond.&rdquo;

OFAC Again Issues License Delaying PdVSA 2020 8.5% Bond-Related Authorizations

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