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Sovereign Wealth Funds: Governance & Risk for SWFs and Companies They Fund

Private companies that receive SWF and SOE investment, as well as the investors who arrange or co-invest with state-linked firms, should, when screening investments and assessing nonfinancial risk before and after the point of investment (and when additional investment is under consideration), the quality and risk inherent in the corporate structure and governance, as well as the business conduct controls of SWFs and SOEs, may affect them in the near- to longer term. In doing so, they should take a lesson from the PIF situation, post-Khashoggi.
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Senate Bill Seeks Sanctions in Khashoggi Case, End to Yemen War

The Saudi Arabia Accountability and Yemen Act of 2018 seeks further sanctions for those responsible for the death of Jamal Khashoggi, including at the highest levels of the Saudi establishment, and an end to the war in Yemen. The Act adds a chapter to the unfolding story of Congress' increasing sanctions activism, stemming from a lack of faith that the Trump Administration will enforce sanctions with fidelity to law and national policy.
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American Economic Power Fuels Sanctions

America's economic and financial heft facilitates the extraterritorial reach of U.S. sanctions and other law. For example, global transactions denominated in U.S. dollars and processed through the U.S. financial system create a jurisdictional nexus between the United States and foreign parties, property, and events.
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Global Magnitsky Sanctions FAQs

The Global Magnitsky Act and Global Magnitsky Sanctions (GMS) are in the public discourse as a result of recent events, such as the case of U.S.-based journalist Jamal Khashoggi and the imposition of Global Magnitsky Sanctions on two Turkish officials in August. To help the public understand the Global Magnitsky framework, MassPoint Legal and Strategy Advisory has published the Global Magnitsky Sanctions FAQs
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Tech Wars: Restrictions on Foreign Access to U.S. Technology

Measures to curb foreign access to U.S. technology have taken and will likely take various forms that will cut across industries and legal disciplines. Among them, as discussed below, are restrictions on foreign access to and influence on U.S. technology through (1) foreign investment, (2) supply chain exclusions, (3) limits on participation in academic and other research, (4) legal or political curbs on U.S. technology access or transfers through third countries, and (5) countermeasures against foreign control of raw materials essential to technological manufacturing and innovation.
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Weaponizing The Law For Trade Objectives Raises Issues

U.S. Law as Trade War Weapon

The ZTE case puts into focus the Trump Administration’s apparent strategy to use U.S. sanctions, along with anti-corruption and anti-money laundering laws, as trade war weapons, specifically as “economic tools” and “tools of economic diplomacy” that “can be important parts of broader strategies to deter, coerce, and constrain adversaries.”
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USMCA Borrows From Secondary Sanctions Playbook to Freeze Out “Non-Market Economy” Nations

The recently published text of the United States-Mexico-Canada trade agreement (USMCA) includes a peculiar provision that confers on each of the parties the right to terminate the USMCA if any of the other parties enters into a "free trade agreement" (FTA) with a country determined by any of the USMCA countries to be a "non-market" economy. Insofar as the USMCA requires the parties to choose between maintaining the trilateral trade agreement or entering into an FTA with a non-market economy country, the USMCA imports the premise that underlies U.S. secondary sanctions.
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Banking Transparency for Sanctioned Persons

On September 7, 2018, Congresswoman Mia Love (R-UT) introduced in the House of Representatives H.R. 6751, the Banking Transparency for Sanctioned Persons Act of 2018 to "increase transparency with respect to financial services benefitting state sponsors of terrorism, human rights abusers, and corrupt officials.” This update discusses the Banking Transparency Act's provisions and what it conveys about the current U.S. legal climate around corruption and human rights sanctions, Congress’ increasingly activist sanctions posture, and the risk management and compliance inferences that U.S. and foreign financial institutions should draw from the Banking Transparency Bill when viewed in context.
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Technology, Human Rights and Sanctions

Some Congress members are lobbying the Administration to impose human rights sanctions on Chinese officials and companies responsible for or complicit in abuses against China’s Uighur Muslim minority and other minorities. Two companies named, Dahua Technology and Hikvision, are very large, China-based global firms that produce surveillance products and systems. The bottom line is that the tech industry should take note of the development (even if no sanctions are imposed), as it foreshadows the legal and reputation risk issues they will, without doubt, face in connection with tech-enabled abuses, privacy encroachments, and other conduct by consumers of tech products and services.
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