Sanctions

U.S. sanctions law

Sanctions

Global Magnitsky Sanctions: The Swiss Army Knife

The Global Magnitsky Sanctions apply worldwide, without any requirement of a jurisdictional nexus with the United States. They define corruption broadly enough to capture a wide range of conduct and persons. The sanctions target “serious human rights abuse,” but do not define the term. Moreover, the sanctions are readily deployable. No tailored legislation, executive order, or other administrative process—other than a sanctions determination by the Secretary of Treasury in consultation with the Secretary of State—is required to impose sanctions anywhere, anytime. Given their global reach, substantive breadth, and wide applicability, the Global Magnitsky Sanctions have distinct utility value as they can be readily employed for multiple legal, policy and strategic objectives. They are the Swiss Army Knife of sanctions. To date, 78 individuals and entities have been sanctioned for corruption and human rights abuses. The most recent of these sanctions actions, against Turkey, has triggered speculation as to its motives and objectives. This is discussed below, as are some of the provisions that suggest the Global Magnitsky Sanctions were formulated for sweeping applicability and enforcement latitude.

Sanctions

United States Sanctions High-Ranking Turkish Officials Under Global Magnitsky

Today the United States took the extraordinary step of imposing sanctions on Turkey’s Minister of Justice Abdulhamit Gul and Minister of Interior Suleyman Soylu. The sanctions were imposed under the Global Magnitsky Sanctions program, promulgated by Executive Order 13818 pursuant to the Global Magnitsky Act of 2016 and the International Emergency Economic Powers Act, among other legal authorities.

National Security Law

Senate Bill Seeks to Protect Magnitsky Law from Trump-Putin Deal

The introduction of legislation after the Helsinki summit to constrain the President’s sanctions authority vis-a-vis Russia is not surprising. As anticipated in this MassPoint post of July 18, “the Helsinki meeting could have legal consequences, should Congress move to insert itself, beyond its standard law-making and oversight role, in sanctions and trade matters,” including in the mold of CAATSA.

Anti-Corruption

Russia Summit Could Spur Congressional Activism on Sanctions, Trade

The meeting in Helsinki between the U.S. and Russian presidents has (as presumably everyone knows) sparked strong reactions in the United States, particularly in response to the U.S. President’s performance. Beyond the politics of the moment and its aftermath, the Helsinki meeting could have legal consequences, should Congress move to insert itself, beyond its standard law-making and oversight role, in sanctions and trade matters. And not just with respect to Russia. There are a number of ways that Congress can play a greater role in sanctions and trade. Such Congressional involvement, if it materializes, would likely be designed to constrain the President, such as by restricting his ability to lift, not impose or modify sanctions through Executive action.

Hdeel Abdelhady Articles

Personal Remittances and Proceeds of Inheritances from Iran After U.S. Withdrawal from Iran Deal

For U.S. persons seeking to engage in permitted noncommercial, personal remittance or inheritance-related transactions, the higher risk sensitivity of some third country (and U.S.-based) financial institutions may complicate (or thwart in some cases), legal transactions. In light of this, persons seeking to engage in such legal transactions in the post-U.S. JCPOA withdrawal environment should exercise extra care in initiating and executing legal transfers with third country financial institutions.

Hdeel Abdelhady Articles

United States Sanctions Malaysia Agent of Iranian Airline

The Treasury Department’s Office of Foreign Assets Control (OFAC) today sanctioned Malaysia-based Mahan Travel and Tourism Sdn Bhd (“Mahan Travel”) pursuant to Executive Order  13,224. Rather then information should be taken as a prompt to other travel agencies or vendors that directly or indirectly “act for or on behalf of Mahan Air” to disassociate from the airline. Such other travel agencies or vendors should, at minimum, review and understand today’s Mahan Travel action, assess their sanctions and related risk (legal, commercial, etc.) and take defensive compliance steps that are appropriate to their sanctions/legal exposure and commercial position. The broader takeaway from today’s OFAC action against Mahan Travel is that it reinforces the fact that U.S. sanctions and other laws are global in reach. Non-U.S. parties should take note of their potential exposure to U.S. sanctions or other legal enforcement actions.

Anti-Corruption

Global Magnitsky Regulations: U.S. Multinationals and Dual Citizens Have Heightened Sanctions Exposure

U.S. multinational companies/entities as well as dual citizens/nationals should understand their heightened sanctions exposure under the Global Magnitsky Act, EO 13,818 and the GloMag Regulations. Multinational companies/entities would be well-advised to update their risk-based compliance programs and educate their relevant personnel to make compliance more likely, including by avoiding inadvertent violations of the Global Magnitsky Act, EO 13,818 and the GloMag Regs.

Sanctions

ZTE: Was the Export Ban the Right Penalty?

The sentiments expressed by Senator Rubio and others reflect commercial, competition, policy, and strategic concerns held by business, policy makers, defense and national security officials, and others about China and Chinese firms like ZTE and Huawei. But when raised in the context of and as a justification for a specific legal enforcement action, the sentiments blur the lines between what should primarily be an enforcement based on facts and applicable laws, rather than an instrument for advancing wider policy objectives that are not specifically advanced by the laws applicable to the conduct for which ZTE was penalized. And, while Secretary Ross’ stated rationale to impose the harsher penalty to change ZTE’s behavior may have been sound, the recommendation of the career professionals with expertise in sanctions and export controls enforcement should, perhaps, have carried the day. Secretary Ross’ description of the process leading to the export ban and the mess that has followed it give more reason to ask whether, in the first place, the export ban was the appropriate remedy as a matter of applicable laws and the objectives served by them.

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