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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 Department of the Treasury&rsquo;s Office of Foreign Assets Control (OFAC) issued a final rule on&nbsp;<a href="https://www.federalregister.gov/documents/2024/09/17/2024-20857/updating-provisions-related-to-blocking-and-other-actions-related-to-specific-property-or-interests#print" target="_blank" rel="noreferrer noopener">Updating Provisions Related to Blocking and Other Actions Related to Specific Property or Interests in Property</a>. The rule is effective as of September 17, 2024.
The new rule aims to clarify OFAC&rsquo;s process for issuing orders that block or identify specific blocked property or interests in property. It updates 35 parts of 31 CFR chapter V to improve regulations regarding these actions. This comprehensive update is designed to provide clearer guidance on how OFAC exercises its authority under various statutes, including the International Emergency Economic Powers Act (IEEPA).
<h2 class="wp-block-heading">Three Forms of Actions</h2>
The final rule identifies three primary forms of actions OFAC may take with respect to specific property or interests in property:
<ul class="wp-block-list">
<li>Identifying Blocked Property: OFAC may identify specific property or interests in property as blocked due to an interest of an already blocked person. This is particularly useful in cases where such interests may not be apparent to the public.</li>
<li>Blocking Pending Investigation: OFAC may block specific property or interests in property of a person who is not yet designated but is under investigation for potential designation. This measure ensures that the property is not transferred before a final decision is made.</li>
<li>Non-Full Blocking Sanctions: In certain cases, OFAC may impose prohibitions that are less than full blocking sanctions. In such cases, OFAC would determine that a person meets the criteria for designation but would take action less than blocking the entirety of a person&rsquo;s property and interests in property.</li>
</ul>
<h2 class="wp-block-heading">Notice and Communication</h2>
The rule outlines various forms of notice that OFAC may use to inform affected parties about its actions:
<ul class="wp-block-list">
<li>Federal Register: For designation actions, OFAC will publish notices in the Federal Register, providing constructive notice to the public.</li>
<li>Direct Written Notice: For more tailored actions, when OFAC takes more tailored action with respect to specific property or interests in property, OFAC may provide actual notice directly to affected persons or indirectly through financial institutions or other intermediaries.</li>
<li>Transaction Intermediaries: Financial institutions or other intermediaries may be required to notify affected persons with whom they maintain direct commercial relationships.</li>
</ul>
The rule also updates the note in the subject parts that explains the procedures for seeking release of blocked property or administrative reconsideration of OFAC actions to add information about additional unblocking procedures available to blocked or otherwise affected persons. These procedures are detailed in Subpart E of part 501 of 31 CFR chapter V.

OFAC Issues Final Rule on Procedures Related to Blocking Property

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