On December 30, 2014, the Treasury Department licensed wind-down activities involving Crimea, subject to certain reporting obligations and other conditions. The new general license authorizes activities that would otherwise be prohibited by Executive Order 13685 of December 19, 2014, which blocked (i) new investment in Crimea, (ii) the importation of goods, services or technology from Crimea into the United States, (iii) the export, reexport, sale or supply, directly or indirectly, of goods, services or technology from the United States to Crimea; and (iv) any facilitation by a U.S. person of activities by a non-U.S. person that a U.S. person could not undertake directly. The Executive Order also authorized the Secretary of the Treasury to block the property of certain parties operating in Crimea.
Under the general license, U.S. persons may engage in otherwise prohibited activity that is ordinarily incident and necessary to the divestiture or transfer to a foreign person of the U.S. person’s ownership shares in pre-December 20, 2014 investments in Crimea. The license also authorizes the winding down of pre-December 20 operations, contracts, or other agreements involving exports to or imports from Crimea. The general license does not authorize any new imports from or exports to Crimea, only transactions that are ordinarily incident and necessary to the winding down of pre-December 20 agreements. The wind-down window closes at midnight on January 31, 2015. U.S. persons engaging in wind-down activities must, within ten business days of the conclusion of wind-down activities, report to the Office of Foreign Assets Control (OFAC) the type and scope of activities conducted under the license, the parties involved and the dates of the activities.
In addition, on January 2, 2015, the President imposed additional sanctions against North Korea. The White House stated in its press release that the sanctions are “a response to the Government of North Korea’s ongoing provocative, destabilizing, and repressive actions and policies, particularly its destructive and coercive cyber attack on Sony Pictures Entertainment.”
The sanctions block the property of ten North Korean officials and three North Korean governmental entities. The sanctions also bar the designated individuals from entering the United States. In addition, the Executive Order authorizes the Secretary of the Treasury to sanction parties associated with North Korea who meet specified criteria, thereby leaving the door open for further sanctions.
If you have any questions regarding this update, please contact the Sidley lawyer with whom you usually work or
Lisa A. Crosby
Andrew W. Shoyer
Sidley’s Economic Sanctions Practice
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