The Treasury’s Office of Foreign Assets Control on Aug. 3 issued a “Russia-related directive” and a set of frequently asked questions to pair with President Donald Trump’s Aug. 1 executive order on chemical and biological weapons sanctions.
As the U.S. continues to impose broad sanctions, companies are increasingly turning away from deals, fearing compliance risks, sanctions lawyers and experts said. While the Trump administration has tried to mitigate sanctions impacts on industry through advance notices, guidance and wind-down periods, the experts said, some of the damages have been unavoidable.
The Treasury's Office of Foreign Assets Control on Aug. 1 removed more than 40 entries from its Kingpin Act designations, which impose sanctions on international narcotics traffickers. The removals include people based in Colombia, Panama, Guatemala and Mexico.
The Treasury’s Office of Foreign Assets Control sanctioned Mohammad Javad Zarif, Iran’s foreign minister and spokesman, Treasury announced July 31. The move comes about a month after Treasury Secretary Steven Mnuchin told reporters in June that President Donald Trump was planning to sanction Javad Zarif (see 1906240046). “Javad Zarif implements the reckless agenda of Iran’s Supreme Leader, and is the regime’s primary spokesperson around the world,” Mnuchin said in a statement. “At the same time the Iranian regime denies Iranian citizens’ access to social media, Foreign Minister Javad Zarif spreads the regime’s propaganda and disinformation around the world through these mediums.”
A top Treasury official acknowledged criticism that the agency is abusing its sanctions powers but stood by the approach, saying the sanctions are necessary and that the Treasury is mitigating impacts on U.S. companies by issuing more compliance guidance.
Export Compliance Daily is providing readers with some of the top stories for July 22-26 in case they were missed.
The Office of Foreign Assets Control’s amendments to its reporting, procedures and penalties regulations are unclear and too broad, the Association of University Export Control Officers and The Clearing House Association said in July 22 comments, joining a series of trade associations that have been critical of the regulations' amendments.
The Treasury’s Office of Foreign Assets Control sanctioned a North Korean citizen in Vietnam for being a North Korean political official and working for a sanctioned North Korean entity, Treasury said in a July 29 press release. Kim Su Il had “ties” to the Workers’ Party of Korea and is an employee of the Munitions Industry Department (MID), which is sanctioned by both the United Nations and the U.S. for being involved with North Korea’s missile program, the press release said. Treasury said Kim Su Il worked for the MID in Vietnam and has exported “anthracite coal, titanium ore concentrate” and imported and exported “various other goods, including raw materials, to and from North Korea.” He also exported Vietnamese products to China, North Korea and other countries, the press release said. Along with trading, Kim Su Il also chartered ships.
The Office of Foreign Assets Control’s amendments to its reporting, procedures and penalties regulations are unnecessary, unclear and “overly burdensome” on the U.S. forwarding industry, the National Customs Brokers & Forwarders Association of America said in comments to the agency. The comments stem from OFAC’s June 21 interim final rule on the regulations’ amendments, which expands the scope of certain transactions that must be reported to the Treasury (see 1906200036). The American Association of Exporters and Importers also criticized the amendments, saying they have caused U.S. companies a “great deal of confusion” (see 1907230054).
As the U.S. and the European Union continue to impose diverging sanctions measures, global businesses are being tasked with increasingly challenging compliance dilemmas, several trade experts said during a July 25 KPMG webinar. Companies are facing more strategic decisions about which countries they can and cannot afford to trade with and are reconsidering multiyear contracts because of the constantly changing sanctions landscape, the experts said.