International Sanctions January 2021

2021-03-15 Newsletters

INTERNATIONAL SANCTIONS JANUARY 2021

European Union

SYRIA

On 15 January 2021, Council Implementing Regulation (EU) 2021/29[1] and Council Implementing Decision (CFSP) 2021/30[2] have been published in the Official Journal of the European Union, amending, respectively, Annex II to Regulation (EU) 2012/36 and Annex I to Decision 2013/255/CFSP.

By these amendments, one (1) individual of Syrian nationality has been added to the list of sanctioned persons for his appointment in November 2020 as Minister of Foreign Affairs because “in his capacity as a Government Minister, he shares responsibility for the violent repression by the Syrian regime against the civilian population”.

SOMALIA

On 25 January 2021, Council Regulation (EU) 2021/48[3] and Council Decision (CFSP) 2021/54[4] were published in the Official Journal of the European Union, amending, respectively, Articles 1, 2 and 3 and Annex III of Regulation (EU) 2003/147 and Article 1 and Annexes IV and V of Decision 2010/231/CFSP.

These amendments are made in order to be in line with UN Security Council Resolution 2551 (2020) of 12 November 2020. This Resolution establishes a ‘general and complete arms embargo on Somalia and modifies the exemptions for technical advice, financial assistance and training related to military activities’, in addition to ‘reaffirming the ban on the import of charcoal from Somalia and confirming restrictions on the sale, supply and transfer to Somalia of components of improvised explosive devices’.

TUNISIA

On 25 January 2021, Council Implementing Regulation (EU) 2021/49[5] and Council Decision (CFSP) 2021/55[6] were published in the Official Journal of the European Union, amending, respectively, Annex I to Regulation (EU) 2011/101, as well as Article 5 and the Annex to Decision 2011/72/CFSP.

These amendments remove four (4) persons of Tunisian nationality from the list of sanctioned persons on the grounds that they are not responsible for ‘misappropriation of Tunisian State funds’. In addition, the sanctions of two (2) other persons of Tunisian nationality are amended, stating that “the investigation or trial concerning the misappropriation of public funds or assets is still ongoing”.

UNITED STATES

SAUDI ARABIA

On 12 January 2021, the Office of Foreign Assets Control (“OFAC”), pursuant to the Global Terrorism Sanctions Regulations (“SDGT”), added to the Specially Designated Nationals and Blocked Persons List (“SDN List”) one (1) natural person of Saudi nationality (not specified).

CHINA

On January 5, 2021, OFAC added one (1) Chinese entity to the SDN List for its relationship with the Iranian company Pasargad Steel Complex, an entity sanctioned pursuant to Executive Order 13871, dated May 8, 2019, for operating in the steel sector in Iran.

On 8 January 2021, OFAC issued General License No. 1 authorising the activities prohibited by Section 1(a)(I) of Executive Order 13959 relating to the transaction of financial securities with entities whose name bears a resemblance to the Chinese Communist military companies identified in that Executive Order, but which do not appear on OFAC’s List of Chinese Communist Military Companies. This authorisation is effective as of 28 January.

On 13 January 2021, President Donald Trump issued Executive Order 13974 amending Executive Order 13959 of 12 November 2020, which prohibits financial security transactions with Chinese Communist Military Companies.

On the same date, OFAC has issued General License No. 2 authorising the activities prohibited by Section 1(a)(II) of Executive Order 13959 relating to the transaction of financial securities with entities that are included on OFAC’s Chinese Communist Military Companies List as of 14 January, i.e. 365 days after they have been included on that List.

On 15 January 2021, OFAC, pursuant to Executive Order 13936 of 14 July 2020, has added one (1) individual Chinese national to the SDN List for “curtailing Hong Kong’s autonomy and restricting freedom of expression in the assembly of citizens in Hong Kong“.

In addition, OFAC has added one (1) Chinese entity to the SDN List pursuant to Executive Order 13846 of 6 August 2018, which imposes sanctions on entities operating in certain strategic sectors of the Iranian economy, such as the oil, automotive or metals sectors.

On 26 January 2021, OFAC issued General License No. 1A, authorising, as of 27 May, the activities prohibited by Section 1(a) of Executive Order 13959, as amended by Executive Order 13974 of 13 January 2021, relating to the transaction of financial securities with entities whose name bears a resemblance to Chinese Communist military companies, as defined in Section 4(a) of Executive Order 13959, provided that the name is not exactly the same.

CUBA

On December 24, 2020, an article has been published in Cubatrade.org concerning the first application since the Agricultural Improvement Act, known as “Farm Bill,” authorized the use of U.S. Department of Agriculture funds for Cuba’s Market Access Program.

Since the Act came into force on 20 December 2018, no application has been made. The amount of the application is USD 60,000.

On December 24, 2020 Cubatrade.org has reported on the possibility of the Roswell Park Cancer Center (“CORP”) being sued under Title III of the Helms – Burton Act (“HB Act”).

In October 2016, CORP received authorisation from OFAC to establish a commercial venture with the Molecular Immunology Centre in the Mariel Special Development Zone.

As is well known, the Trump Administration activated Title III of the HB Act, which authorises lawsuits in US courts against companies or individuals who are using claimed property, whether certified or uncertified, when the owner of the property has not received compensation from Cuba or the third party using the property.

As of December 30, 2020, OFAC has sanctioned one (1) U.S. entity for apparent violations of multiple sanctions programs related to digital currency transactions.

On January 1, 2021, the Trump Administration has added to the Cuba Restricted List one (1) Cuban entity “controlled by Cuban military personnel that benefits directly from financial transactions at the expense of the Cuban people.”

On 6 January 2021, an article has been published on Cubatrade.org reporting that the Israeli shipping company ZIP Integrated Shipping Services Ltd., about to go public in the United States, may become the 33rd defendant under the HB Act.

The Israel-based company provides services from the United States to Cuba, including the Mariel Container Terminal. A member of the family that controls the entity has been a director since 1995 of the Royal Caribbean Group, which in August 2019 was sued under Title III of the HB Act.

On 11 January 2021, a report has been published on Cubatrade.org regarding US exports of agricultural products and foodstuffs to Cuba during 2020. Exports during the month of November increased by 282.3% compared to 2019. However, looking at the full year, exports are down 41%.

On 11 January 2021, the Trump Administration decided to re-designate Cuba as a State Sponsor of Terrorism, sixty-five months after the country was removed from this same List. Cuba was originally assigned to this List in 1982 but was removed in 2015 by then President Barack Obama. However, on 11 January 2021, the US State Department published a press release announcing the inclusion of Cuba on this List for “providing support for acts of international terrorism by granting asylum to terrorists”.

In order to remove a foreign state from the List, there are two possible options: first, the US President must certify and report to Congress that there has been a fundamental change in the leadership and policies of the government of the state in question, and that the government is not supporting acts of international terrorism; and second, the government of the sanctioned country must have guaranteed that it will not support acts of international terrorism in the future.

On 11 January 2021, the 24th Court of Instruction of Palma de Mallorca, Spain, has included the Cuban Government and Gaviota S.A. as defendants in the lawsuit filed by Central Santa Lucía L.C. against the Spanish company Meliá Hotels International S.A. (“Meliá”) on 29 May 2019.

At the pre-trial hearing, Meliá asked the judge to include in the proceedings the Government of the Republic of Cuba, the entity Gaviota S.A., controlled by the Revolutionary Armed Forces (FAR) of the Republic of Cuba, and the Panamanian entity Gesmesol S.A., controlled by Meliá. The judge decided that the Government of the Republic of Cuba and Gaviota S.A. should be included in the lawsuit for unjust enrichment against Meliá as “necessary parties because they are responsible for the initial expropriation and the current management of the plaintiff’s property”. The plaintiff has not appealed this decision.

On 14 January 2021, the US Bureau of Industry and Security (BIS) imposed new controls on the Department of Commerce over technologies and certain activities of US persons that “could support foreign military intelligence services and end-users in China, Cuba, Russia and Venezuela, as well as countries that support terrorism”. Controls have also been increased to prevent US persons from supporting unauthorised weapons of mass destruction (WMD) programmes. Thus, the military intelligence services that will be affected from 16 March 2021 by these new controls are those of Cuba, China, Iran, North Korea, Russia, Syria and Venezuela.

Effective 15 January 2021, OFAC, pursuant to Executive Order 13818 of 20 December 2017, has added one (1) natural individual of Cuban nationality and one (1) Cuban entity to the SDN List for “serious human rights abuses”.

On 15 January 2021, the US State Department amended its website to include the Republic of Cuba on the List of State Sponsors of Terrorism, after having designated the country’s return to the List on 11 January.

On 20 January 2021, it has been reported that, in connection with the lawsuit filed by Havana Docks Corporation (“Havana Docks”) against Norwegian Cruise Lines Holdings, Ltd. (“Norwegian”), Norwegian will use “attorney-client privilege” as a defence not to produce documents in the case.

On 21 January 2021, an article was published on Cubatrade.org containing comments from the Biden Administration on what to expect from relations with Cuba. Among these comments, several stand out, for example: “our approach to Venezuela and Cuba will be based more on communication than isolation“, “removing Cuba from the List of State Sponsors of Terrorism will be an issue we will review and consult with Congress” and, regarding Title III of the Cuban Liberty and Democratic Solidarity Act of 1996, also known as the Libertad Act or Helms-Burton Act, reactivated by the Trump Administration in May 2019, they have assured that “negotiating the resolution of certified claims is a priority”.

On 22 January 2021, it has been reported that the designation of Cuba as a State Sponsor of Terrorism has been published in the Federal Register, twelve days after the US State Department’s decision, dated 11 January, to reinstate Cuba on the corresponding List.

On 27 January 2021, an article has been published on Cubatrade.org speculating on a possible reconciliation between the White House and Major League Baseball (MLS). On 19 December 2018, MLS announced an agreement with the Cuban Baseball Federation (FCB). However, the Trump Administration denied this agreement on the grounds that MLS payments to the FCB would end up indirectly favouring the Government of the Republic of Cuba. However, there is an option that, with the appointment of Joseph Biden as President of the US, this agreement will be reviewed, or a request will be issued to OFAC in the form of a General License in order to re-establish relations between MLS and FCB.

On 28 January 2021, an article was published on Cubatrade.org highlighting the statements made by the new White House press secretary, Jen Psaki, who stated during a question-and-answer session that “Our policies toward Cuba are governed by two principles. First, support for democracy and human rights (…) Second, Americans, especially Cuban-Americans, who are the best ambassadors for Cuba’s freedom, so we will review the Trump Administration’s policies”.

On 29 January 2021, Cubatrade.org published an article in which it is reflected that the Spanish Minister of Industry, Trade and Tourism, Reyes Maroto, has sent a letter to the Vice-President of the European Commission, Valdis Dombrovskis, urging him to initiate talks with the new US Administration to suspend the Helms-Burton Act and the tariffs imposed on Spanish products.

According to the Minister, the Helms-Burton Act harms Spanish trade and investment in Cuba, particularly in the tourism sector, while the tariffs affect the export of products such as olive oil, wine and olives. In his words, “the restoration of mutual confidence is clearly one of our key objectives in our future trade policy. We must identify the main areas for immediate action and build on our mutual needs, which we share in our respective trade and foreign policies. The resolution of these disputes would send a message of confidence to the private sector, which is crying out for a negotiated solution between the two sides.”.

On 31 January 2021 it has been reported in relation to the complaint filed on 8 January 2020 by María Dolores Canto Martí against Iberostar Hoteles y Apartamentos SL (“Iberostar”) that the European Commission has not yet taken a position on this matter as of 19 January 2021. Iberostar submitted on 15 April 2020, a request asking the European Commission to authorise it to respond to the complaint filed by the Cuban-born family for the operation of a hotel in Cuba and in relation to the Helms-Burton Act.

EGYPT

As of 14 January 2021, OFAC, pursuant to the Global Terrorism Sanctions Regulations (GTS), has added one (1) natural person of Egyptian nationality to the SDN List.

UNITED ARAB EMIRATES

On 15 January 2021, OFAC added one (1) Emirati entity to the SDN List, pursuant to Executive Order 13846 of 6 August 2018, which imposes sanctions on entities operating in certain strategic sectors of the Iranian economy, such as the oil, automotive and metals sectors.

FRANCE

On 4 January 2021 OFAC announced an agreement, for a total value of USD 8,572,500, with Union de Banques Arabes et Françaises (UBAF), a France-based bank that facilitates trade finance between Europe and the Middle East, North Africa, sub-Saharan Africa and Asia. UBAF has agreed to settle its potential civil liability for 127 apparent violations of Executive Order 13582 and Executive Order 13382.

The apparent violations, carried out between August 2011 and April 2013, relate to the management of accounts of sanctioned Syrian financial institutions and the indirect conduct of business on behalf of these institutions in the US financial system. OFAC concludes by emphasising that the settlement amount reflects OFAC’s consideration that the apparent violations were not serious and were voluntarily disclosed by UBAF.

HONG KONG

On 15 January 2021, OFAC, pursuant to Executive Order 13936 of 14 July 2020, added five (5) Hong Kong natural persons to the SDN List for “curtailing Hong Kong’s autonomy and restricting freedom of expression in the assembly of citizens in Hong Kong”.

INDONESIA

On 14 January 2021 OFAC announced a settlement, for a total value of USD 1,016,000, with PT Bukit Muria Jaya (BMJ), an Indonesia-based manufacturer of paper products. BMJ has agreed to settle its potential civil liability for 28 apparent violations of the North Korea Sanctions Regulations, 31 C.F.R. part 510.

The apparent violations, carried out between March 2016 and May 2018, relate to the export of cigarette paper to the Democratic People’s Republic of Korea. BMJ received payments for these exports into a dollar account at a non-US bank, which resulted in US banks conducting transfers related to these shipments, some of which were directed to a sanctioned North Korean natural person. OFAC concludes by emphasising that BMJ’s apparent violations were not serious.

IRAN

Effective 5 January 2021, OFAC, pursuant to Executive Order 13871, dated 8 May 2019, has added twelve (12) Iranian entities to the SDN List for their relationship with the steel sector in Iran.

In addition, pursuant to the Iran Freedom and Counter-Proliferation Act of 2012 (“IFCA”), OFAC has added two (2) Iranian entities and one (1) Iranian natural person to the SDN List for “having sold, supplied, or transferred, directly or indirectly, graphite to or from Iran, such graphite being sold, supplied, or transferred to or by an Iranian person on the SDN List”.

Effective 13 January 2021, OFAC has added three (3) Iranian natural persons and sixteen (16) entities to the SDN List pursuant to Executive Order 13876, dated 24 June 2019, which imposes sanctions on the Supreme Leader of the Islamic Republic of Iran, the Office of the Supreme Leader, any Iranian government official, and any person appointed by the Supreme Leader of the Islamic Republic of Iran to an official position.

As of 15 January 2021, OFAC has added two (2) Iranian natural persons and two (2) Iranian entities to the SDN List pursuant to Executive Order 13846, dated 6 August 2018, which imposes sanctions on entities operating in certain strategic sectors of the Iranian economy, such as the oil, automotive or metals sectors.

IRAQ

Effective 8 January 2021, OFAC, pursuant to Executive Order 13818, dated 20 December 2017, has added to the SDN List one (1) natural person of Iraqi nationality for “being the leader or part of an entity, including any governmental entity, that has committed, or whose members have committed, serious human rights abuses”.

As of 12 January 2021, OFAC, pursuant to the Global Terrorism Sanctions Regulations (GTSR), has added three (3) natural persons of Iraqi nationality (not specified) to the SDN List.

On 13 January 2021, OFAC, pursuant to the Global Terrorism Sanctions Regulations (GTSS), added one (1) natural person of Iraqi nationality (not specified) to the SDN List.

MOROCCO

As of 12 January 2021, OFAC, pursuant to the Global Terrorism Sanctions Regulations (GTSS), has added one (1) natural person of Moroccan nationality (not specified) to the SDN List.

TERRORISM

On 25 January 2021, OFAC issued General License No. 13, authorising all transactions and activities in relation to Ansarallah prohibited by the Global Terrorism Sanctions Regulations (GTSR), 31 C.F.R. part 549, the Foreign Terrorist Organizations Sanctions Regulations (FTSOR), 31 C.F.R. part 597, or Executive Order 13224 of 23 September 2001. This authorisation will enter into force on 26 February.

TURKEY

On 14 January 2021 OFAC, pursuant to the Global Terrorism Sanctions Regulations (GTSR), has added one (1) natural person of Turkish nationality (not specified) to the SDN List.

UKRAINE

On 11 January 2021, OFAC, pursuant to Executive Order 13848 of 12 September 2018, added seven (7) natural persons and four (4) individuals to the SDN List for “their relationship with Russian agent Andrii Derkach and for attempting to influence the U.S. electoral process“.

VENEZUELA

Dated 4 January 2021 OFAC has issued General License No. 31A authorising certain transactions with the IV Venezuelan National Assembly, Venezuelan Interim President Juan Gerardo Guaidó Márquez and other authorised persons.

On 19 January 2021, OFAC, pursuant to Executive Order 13850 of 1 November 2018, has added to the SDN List three (3) natural persons, fourteen (14) entities and six (6) vessels for “their association with a network that sought to evade sanctions imposed by the United States on Venezuela’s oil sector“.

YEMEN

On 19 January 2021, OFAC, pursuant to the Global Terrorism Sanctions Regulations (GTSR) and Executive Order 13224, added three (3) natural persons of Yemeni nationality and one (1) entity to the SDN List.

UNITED KINGDOM

On 31 December 2020, the United Kingdom has reproduced the sanctions imposed by the European Union on individuals and entities in the following countries:

ALGERIA, SAUDI ARABIA, AUSTRALIA, BELARUS, CANADA, CHINA, COLOMBIA, NORTH KOREA, EGYPT, SPAIN, PHILIPPINES, FRANCE, GUINEA BISSAU, INDIA, IRAN, ISRAEL, KAZAKHSTAN, KYRGYZSTAN, LEBANON, LIBYA, LITHUANIA, MYANMAR, NICARAGUA, NETHERLANDS, PAKISTAN, PALESTINE, PERU, CZECH REPUBLIC, DEMOCRATIC REPUBLIC OF CONGO, RUSSIA, SYRIA, SRI LANKA, SOUTH SUDAN, TURKEY, UKRAINE, UZBEKISTAN, VENEZUELA, ZIMBABWE

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[1] Regulations Execution (EU) 2021/29 of 15 January 2021 implementing Regulation (EU) N° 2012/36 on restrictive measures in the light of the Situation in Syria.

[2] Decision Execution Council 2021/30 of 15 January 2021 implementing the Decision 2013/255/CFSP Adoption restrictive measures against Syria.

[3] Council Regulation (EU) 2021/48 of 22 January 2021 amending Regulation (EC) No 2003/147 concerning certain restrictive measures in respect of Somalia.

[4] Council Decision (CFSP) 2021/54 of 22 January 2021 amending Decision 2010/231/CFSP concerning restrictive measures against Somalia.

[5] Council Implementing Regulation (EU) 2021/49 of 22 January 2021 implementing Regulation (EU) No 2011/101 concerning restrictive measures directed against certain persons, entities and bodies in view of the situation in Tunisia.

[6] Council Decision (CFSP) 2021/55 of 22 January 2021 amending Decision 2011/72/CFSP concerning restrictive measures directed against certain persons and entities in view of the situation in Tunisia.