The imposition of sanctions on the Chinese companies and executives—particularly on units of the high-profile, state-owned COSCO at a critical juncture in the U.S.-China trade war and shortly after both countries took conciliatory steps—reinforces the Trump Administration’s stated posture of aggressively enforcing Iran secondary sanctions in furtherance of its policy objectives.
MassPoint Legal and Strategy Advisory's Hdeel Abdelhady spoke about FARA enforcement mechanisms, recent and historical enforcement, recent developments and their implications, and questions that might arise in the near future. Ms. Abdelhady's presentation materials are provided here as a resource.
Two "small" cases enforcing OFAC's reporting rules indicate OFAC's RPPR compliance expectations and enforcement posture. These and a recent sectoral sanctions enforcement show again that cases involving small (or no) monetary penalties can yield big compliance lessons.
The September 1 tariffs effective date is close in time to the expiration of the Temporary General License partially easing restrictions on Huawei. The state of U.S.-China trade talks around the expiry of the 90-day license may influence further actions. U.S. and foreign companies subject to export controls should be mindful of the potential links.
Ms. Abdelhady addressed how the CFTC's current investigation of Glencore and its broader anti-corruption plans might fit with the Trump Administration's wider anti-corruption strategy targeting the extractives industry globally, as well as the how the CFTC, which lacks direct FCPA enforcement authority, might take a page from the NYDFS' playbook and indirectly enforce an anti-corruption agenda under the Commodities Exchange Act.
Hdeel Abdelhady shared her insights with PaymentsSource on a Russia-led effort to build a non-U.S. dollar payments system, to insulate against U.S. sanctions and U.S. control more broadly. Ms. Abdelhady has for years worked on the U.S.-dollar and financial system links to U.S. sanctions enforcement jurisdiction. Her work on the topic of U.S. dollar and financial system tied legal jurisdiction has been quoted, leveraged, and consulted frequently in the United States and abroad.
Hdeel Abdelhady has been named a Fellow of the American Bar Foundation, a “global honorary society of attorneys, judges, law faculty, and legal scholars. Membership in the Fellows is limited to one percent of lawyers licensed to practice in each jurisdiction. Fellows are recommended by their peers and elected by the Board of the American Bar Foundation.
On June 21, the Office of Foreign Assets Control (OFAC) issued an interim final rule (IFR) substantially revising sanctions reporting regulations. The most significant amendment was to OFAC’s rejected transactions reporting rule, which now, for the first time, applies not just to U.S. financial institutions, but also to U.S. businesses, nonprofits, and individuals. The rule also appears to apply to foreign entities owned or controlled by U.S. persons. Public comments on the IFR are due by July 22, 2019.
Business transactions necessarily become more complex when they involve two or more countries. Among other tasks, it is necessary to understand the content and applicability of foreign laws, retain local counsel, address conflict of law issues, and make (hopefully strategically, rather than as an afterthought) governing law and dispute resolution selections.The focus on more substance aspects of international transactions should not be exclusive.
After talks with China’s president at the G20 summit in Japan, President Trump announced on June 29 that “he would allow” U.S. companies to continue to sell “product” to Huawei. The statement, construed by some as a “concession” or “reversal” of U.S. policy toward Huawei, has generated confusion and disagreement from China “hawks” in Congress and elsewhere. This rundown of Huawei legal and policy issues discusses the presidential statement, its lack of legal effect to date, its context, and why technology industry stakeholders need to understand the complete U.S.-China technology picture to navigate developments and mitigate risk.