Within the past week, the United States Department of the Treasury’s Office of Foreign Assets Control (OFAC) announced additional sanctions with respect to Iran, in furtherance of the United States’ maximum pressure campaign against the Iranian regime.
On October 26, 2020, OFAC announced additional sanctions against Iran’s oil sector, including with respect to those involved in the sale of gasoline to the Maduro regime in Venezuela. OFAC also released General License 8A, which permits certain humanitarian transactions involving the Central Bank of Iran (CBI) and/or the National Iranian Oil Company (NIOC), and OFAC published amended Frequently Asked Questions. The identifying information for the individuals, companies, and vessels sanctioned is located here.
On October 29, 2020, OFAC announced sanctions against those involved in the sale and purchase of Iranian petrochemical products. Notably, OFAC sanctioned individuals and entities for assisting Triliance Petrochemical Co. Ltd. (Triliance), which itself had been sanctioned by OFAC in January 2020. That same day, OFAC released General License M, which permits certain U.S. graduate and undergraduate academic institutions to provide online educational services to Iranian students. The identifying information for the persons sanctioned is located here.
New Iran Sanctions
OFAC’s October 26 sanctions against CBI, NIOC, and numerous other affiliated individuals, companies, and vessels were pursuant to Executive Order 13224, which are OFAC’s counter-terrorism sanctions. These actors were sanctioned for providing financial support to Iran’s Islamic Revolutionary Guard Corps-Qods Force (IRGC-QF), which had previously been designated pursuant to E.O. 13224, among other authorities.
As a result of the new sanctions, U.S. persons are prohibited from engaging in any transaction or dealing in property or interests in property of the CBI, NIOC, or affiliated entities under the Global Terrorism Sanctions Regulations. In addition, U.S. persons and U.S.-owned or controlled foreign entities are subject to broad prohibitions under the Iranian Transactions and Sanctions Regulations (ITSR). Non-U.S. persons, including foreign financial institutions, also have risk in doing business with these entities.
OFAC’s October 29 sanctions against entities and individuals involved in the purchase and sale of Iranian petrochemical products were pursuant to E.O. 13846, including for having materially assisted, sponsored, or provided financial, material, or technological support for, or goods or services to or in support of, certain designated entities.
General Licenses
General License 8A permits certain humanitarian-related transactions and activities involving CBI, NIOC, or affiliated entities. However, GL 8A does not permit humanitarian-related transactions involving Iranian financial institutions that have been designated under E.O. 13224, other than CBI.
Notably, OFAC advised in amended FAQ 823 that non-U.S. persons generally do not risk exposure under secondary sanctions for engaging in the sale of agricultural commodities, food, medicine, or medical devices to Iran, so long as the transactions do not involve actors sanctioned in connection with Iran’s support for international terrorism or weapons of mass destruction proliferation.
General License M permits certain U.S. academic institutions to provide online educational services and export the accompanying software to Iranian students. Iranian students are defined in the GL to be individuals located in Iran (or located outside Iran, but are ordinarily resident in Iran), eligible for non-immigrant classification under categories F or M, and have been granted a non-immigrant visa by the State Department, but are not physically present in the U.S. due to the COVID-19 pandemic. Notably, U.S. persons are still permitted to export certain education services under GL G, and to export, re-export, and provide certain services, software, and hardware incident to personal communications under GL D-1.
We will continue to closely monitor developments in this space. If you have any questions or concerns about U.S. sanctions, please contact Bruce G. Paulsen (212-574-1533) or Andrew S. Jacobson (212-574-1477) at Seward & Kissel’s Sanctions Practice Group.
