Sanctions database - KSE Sanctions

USA

Trade restrictions

Business and administrative services ban

Russia

Comprehensive - entities, individuals

OFAC issued a Determination pursuant to E.O. 14071 that prohibits the export, reexport, sale, or supply (directly or indirectly) of any accounting, trust and corporate formation, or management consulting services to any person located in Russia. This prohibition applies to all U.S. persons (wherever they are located) and all persons located in the U.S. (whatever their nationality). This Determination takes effect on June 7, 2022. The E.O. 14071 established both a ban on all new investment in Russia and a ban on the provision of certain services to be identified by OFAC. The Determination implements the sections of the EO that target services. In consultation with the Department of State, OFAC may exercise its authority under the EO to ban additional services in the future. The Determination restricts the provision of the following services to persons located in Russia: - Accounting services include services related to the measurement, processing, and transfer of financial data about economic entities. - Trust and corporate formation services include: services related to assisting persons in forming or structuring legal persons, such as trusts and corporations; acting or arranging for other persons to act as directors, secretaries, administrative trustees, trust fiduciaries, registered agents, or nominee shareholders of legal persons; providing a registered office, business address, correspondence address, or administrative address for legal persons; and providing administrative services for trusts. - Management consulting services include services related to: strategic advice; organizational and systems planning, evaluation, and selection; marketing objectives and policies; mergers, acquisitions, and organizational structure; staff augmentation and human resources policies and practices; or brand management. Section 4 of the Executive Order 14071 states that for the purposes of the Order, the definitions for the terms are as follows: ‘‘US person’’ means any US citizen, lawful permanent resident, entity organized under the laws of the US, or any jurisdiction within the US (including foreign branches), or any person in the US. ‘‘person’’ means an individual or entity. ‘‘entity’’ means a partnership, association, trust, joint venture, corporation, group, subgroup, or other organization. FAQ 1058 clarifies that the term “person located in Russia” includes (i) persons in Russia, (ii) individuals ordinarily resident in Russia, and (iii) entities incorporated or organized under the laws of Russia or any jurisdiction within Russia. FAQ 1060 notes that the OFAC Service Ban does not, in itself, prohibit US persons from serving as directors of companies located in Russia, although it does prohibit US persons from providing nominee officer or director services in which a US person is contracted to serve as a nominee officer, director, shareholder, or signatory of a legal person on behalf of a person located in Russia. FAQ 1062 confirms that the OFAC Service Ban applies to services provided to a parent company located in Russia by any US Person, including the Russian company’s US subsidiary. FAQ 1063 clarifies that the OFAC Service Ban does not distinguish between new and existing trusts and companies, meaning that US Persons are prohibited from providing trust and corporate formation services to persons located in Russia, regardless of whether the services are performed as part of the formation of a new trust or company, or as part of the administration or maintenance of an existing trust or company. FAQ 1064 clarifies that the prohibitions on management consulting services include executive search and vetting services. OFAC interprets management consulting services to include services related to strategic business advice; organizational and systems planning, evaluation, and selection; development or evaluation of marketing programs or implementation; mergers, acquisitions, and organizational structure; staff augmentation and human resources policies and practices; and brand management. FAQ 1065 provides that the OFAC Service Ban prohibits US persons from serving as voting trustees on behalf of, or for shares of, persons located in Russia, unless exempt or authorized by OFAC. FAQ 1066 notes that the OFAC Service Ban does not prohibit the provision of educational services, such as online university courses, on the subjects of accounting, management consulting, or trust and corporate formation to persons located in Russia, provided such services do not serve to evade or avoid the primary prohibitions. FAQ 1067 confirms that the OFAC Service Ban does not prohibit US persons from exporting, reexporting, selling, or supplying, directly or indirectly, software to Russia, nor does it prohibit US persons from providing services associated with the export of such software, such as software design and engineering, provided that such associated services do not fall within the categories of management consulting, accounting, or trust and corporate formation. Note that US export controls further regulate the export or reexport of certain software to Russia. FAQ 1068 clarifies that, for purposes of the OFAC Service Ban, “accounting services” include tax preparation and filing services. Link to the original

The Determination contains two exclusions:
1) services may be provided to entities located in Russia that are owned or controlled (directly or indirectly) by a US person;
2) services may be provided in connection with the wind down or divestiture of an entity located in Russia that is not owned or controlled, directly or indirectly, by a Russian person or an entity organized under the laws of Russia.
FAQ 1059 clarifies that US Persons are not prohibited from providing services to persons located outside of Russia that are owned or controlled by persons located in Russia, provided that the provision of services is not an indirect export to a person located in Russia. OFAC interprets the “indirect” provision of the prohibited services to include when the benefit of the services is ultimately received by a “person located in Russia.”
 Persons outside the Russian Federation: FAQ 1059 explains that the Determination does not prohibit US persons from providing services to persons located outside Russia that are owned or controlled by a “person located in the Russian Federation,” provided the provision of services does not constitute an “indirect export” to a “person located in the Russian Federation” (including when the benefit of the services is ultimately received by such person).
FAQ 1061 clarifies that while US Persons are prohibited from exporting, reexporting, selling, or supplying, directly or indirectly, management consulting, trust and corporate formation services, and accounting services to persons located in Russia in their capacity as employees, US Persons are not prohibited from providing other services not covered by the OFAC Service Ban as part of their employment by Russian companies.
FAQ 1067 clarifies that the determination does not prohibit U.S. persons from exporting, reexporting, selling, or supplying, directly or indirectly, software to the Russian Federation, nor does the determination prohibit U.S. persons from providing services associated with the export of such software, such as software design and engineering, provided that such associated services do not fall within the categories of management consulting, accounting, or trust and corporate formation.

08.05.2022

07.06.2022

USA

Financial restrictions

Full blocking

Russia

Business and administrative services

OFAC, in consultation with the Department of State, issued a sectoral determination pursuant to E.O. 14024 that authorizes the imposition of economic sanctions on individuals and entities that operate or have operated in the accounting, trust and corporate formation services, or management consulting sectors of Russian economy. Link to the original

08.05.2022

USA

Trade restrictions

Export control

Russia, Belarus

Comprehensive

Expansion of the coverage of license requirements on the export and reexport of US-origin and certain foreign-produced commodities, software, and technologies to Russia and Belarus under the Export Administration Regulations (“EAR“) on all categories of items on the Commerce Control List (“CCL“). Specifically, this rule applies the additional restrictions established under previous Russia and Belarus rules to Categories 0-2 of unilaterally-controlled technology remaining on the CCL, which include Nuclear Materials, Facilities, and Equipment [and Miscellaneous Items] (Category 0), Special Materials and Related Equipment, Chemicals, “Microorganisms,” and “Toxins” (Category 1) and Materials Processing (Category 2). While the vast majority of items in Categories 0-2 already required a license for Russia and Belarus (or are subject to the licensing authorities of other agencies), this rule imposes new license requirements for items including certain composite materials, medical products containing certain toxins or genetically modified organisms, hydraulic fluids, pumps, valves, and lower-level machine tools. As a result, all items subject to the EAR other than items covered under EAR99 now require a license to export, re-export, or transfer (in-country) to Russia and Belarus. There still is no country-wide licensing requirement for EAR99 items, although exports of these items to military end users or for military end uses in Russia or Belarus require a license. Link to the original

Shipments of items removed from eligibility for a License Exception or reexport or transfer (in-country) without a license (NLR) as a result of this regulatory action that were en route aboard a carrier to a port of export, reexport, or transfer (in-country), on May 9, 2022, pursuant to actual orders for reexport, or transfer (in-country) to or within a foreign destination, may proceed to that destination under the previous eligibility for a License Exception or reexport or transfer (in-country) without a license (NLR).
For all other changes being made in this final rule, shipments of items removed from eligibility for a License Exception or export, reexport, or transfer (in-country) without a license (NLR) as a result of this regulatory action that were en route aboard a carrier to a port of export, reexport, or transfer (in-country), on April 8, 2022, pursuant to actual orders for export, reexport, or transfer (in-country) to or within a foreign destination, may proceed to that destination under the previous eligibility for a License Exception or export, reexport, or transfer (in-country) without a license (NLR).

08.04.2022

USA

Trade restrictions

Export control

Russia, Belarus

Comprehensive

Expansion of the Russia- and Belarus-related Foreign Direct Product Rule (Russia/Belarus FDP rule) to apply to all items on the CCL where the foreign-produced item is the direct product of US-origin technology or software subject to the EAR that falls in any ECCN in product groups D (Software) or E (Technology) on the CCL or produced by a plant or major component of a plant that is itself a direct product of such software or technology subject to the EAR and falling on the CCL. All foreign direct product (FDP) derived from any CCL item are now subject to the same license requirements. Previously, the Russia/Belarus FDPR was limited to Categories 3-9. Link to the original

Shipments of items removed from eligibility for a License Exception or reexport or transfer (in-country) without a license (NLR) as a result of this regulatory action that were en route aboard a carrier to a port of export, reexport, or transfer (in-country), on May 9, 2022, pursuant to actual orders for reexport, or transfer (in-country) to or within a foreign destination, may proceed to that destination under the previous eligibility for a License Exception or reexport or transfer (in-country) without a license (NLR).
For all other changes being made in this final rule, shipments of items removed from eligibility for a License Exception or export, reexport, or transfer (in-country) without a license (NLR) as a result of this regulatory action that were en route aboard a carrier to a port of export, reexport, or transfer (in-country), on April 8, 2022, pursuant to actual orders for export, reexport, or transfer (in-country) to or within a foreign destination, may proceed to that destination under the previous eligibility for a License Exception or export, reexport, or transfer (in-country) without a license (NLR).
BIS added Iceland, Liechtenstein, Norway, and Switzerland to the list of partner countries excluded from the FDP rule as applied to Russia and Belarus. BIS added these countries because they have adopted or have committed to adopt substantially similar export controls on Russia and Belarus. This action brings the total number of countries excluded from application of the FDP rule to 37.

08.04.2022

USA

Trade restrictions

Export control

Belarus

Industry - Aerospace

Removal of the License Exception AVS (Aircraft, Vessels, and Spacecraft) eligibility for aircraft registered in, owned or controlled by, or under charter or lease by Belarus or a national of Belarus. Link to the original

Shipments of items removed from eligibility for a License Exception or reexport or transfer (in-country) without a license (NLR) as a result of this regulatory action that were en route aboard a carrier to a port of export, reexport, or transfer (in-country), on May 9, 2022, pursuant to actual orders for reexport, or transfer (in-country) to or within a foreign destination, may proceed to that destination under the previous eligibility for a License Exception or reexport or transfer (in-country) without a license (NLR).

08.04.2022

USA

Trade restrictions

Import ban

Russia

Energy - Oil

Ending Importation of Russian Oil Act prohibits the importation of energy products from Russia (explicitly codifies the outright ban on Russian energy imports imposed March 8, 2022 by E.O. 14066). It also permanently authorizes the President to impose visa- and property-blocking sanctions based on violations of human rights, and it revises the President's authority to impose these sanctions. All products of Russia classified under Chapter 27 of the Harmonized Tariff Schedule of the US (which includes mineral fuels, mineral oils and products of their distillation, bituminous substances, and mineral waxes), shall be banned from importation into the US, in a manner consistent with any implementation actions issued under E.O. 14066 (relating to prohibiting certain imports and new investments with respect to continued Russian efforts to undermine the sovereignty and territorial integrity of Ukraine), with an exception for prior contracts or agreements. The President may waive this prohibition for national interest reasons, subject to congressional approval. Link to the original

08.04.2022

22.04.2022

USA

Trade restrictions

MFN suspension

Russia, Belarus

Comprehensive

On April 8, the President signed into law the “Suspending Normal Trade Relations with Russia and Belarus Act”. This bill revokes Russia’s and Belarus’s permanent normal trade relations (PNTR) status. Beginning on April 9, imports originating from Russia and Belarus are subject to higher duties. Rather than having duty rates under “Column 1” of the Harmonized Tariff Schedule of the United States (HTSUS) (which average just over 3 % ad valorem) the United States currently applies to imports from all World Trade Organization member countries, Russian and Belarusian goods are now immediately subject to the statutory duty rates set forth in "Column 2" of the HTSUS which average approximately 32.3 %. The suspension remains in effect until 1 January 2024. The bill allows the President until January 1, 2024, to increase the applicable duty rates for Russian and Belarusian goods above the rates set forth in “Column 2” of the HTSUS as long as the President consults with the House Ways and Means Committee and the Senate Finance Committee five days prior. The bill gives the President authority to temporarily restore normal trade relations with Russia and Belarus up to 1 year or permanently if Russia/Belarus cease military hostilities and other conditions are met. Congress may overrule the President’s decision by passing a resolution of disapproval within 90 days of the certification. The bill directs the U.S. Trade Representative to take certain actions, including to consider steps to suspend Russia's participation in the WTO and block the accession process of Belarus. Additionally, the bill permanently authorizes the President to impose visa- and property-blocking sanctions based on violations of human rights, and it revises the President's authority to impose these sanctions. Link to the original

08.04.2022

Completion date: 01.01.2024

09.04.2022

USA

Trade restrictions

Services ban

Russia

Comprehensive

Prohibition on the exportation, reexportation, sale, or supply, directly or indirectly, from the U.S., or by a U.S. person, wherever located, of any category of services as may be determined by the Secretary of the Treasury, in consultation with the Secretary of State, to any person located in Russia. Link to the original

The prohibitions apply except to the extent provided by statutes, or in regulations, orders, directives, or licenses that may be issued pursuant to this order, and notwithstanding any contract entered into or license or permit granted prior to the date of this order.

06.04.2022

USA

Financial restrictions

Investment ban

Russia

Comprehensive - entities

Prohibition on any approval, financing, facilitation, or guarantee by a U.S. person, wherever located, of a transaction by a foreign person where the transaction by that foreign person would be prohibited by this section if performed by a U.S. person or within the U.S. This means that U.S. persons cannot facilitate new Russia investments by companies or persons outside of the U.S. Moreover, a non-U.S. person could be held liable for "causing" a U.S. person to violate the order if the non-U.S. person made a new investment in Russia in U.S. dollars cleared through or transferred with the involvement of a U.S. correspondent bank or other U.S. person. The April 6, 2022 E.O. does not specify how investments by U.S. persons in non-U.S. companies which engage in new Russia investments would be treated, and OFAC may release further guidance explaining the parameters of this broad restriction on new investments. Link to the original

The prohibitions apply except to the extent provided by statutes, or in regulations, orders, directives, or licenses that may be issued pursuant to this order, and notwithstanding any contract entered into or license or permit granted prior to the date of this order.

06.04.2022

USA

Financial restrictions

Investment ban

Russia

Investments

Prohibition on new investment in Russia by a U.S. person, wherever located. On 6 June, OFAC issued a series of FAQs that provide guidance on three recent Executive Orders (EOs), which imposed bans on certain “new investment” in Russia: EO 14071, which on April 6 banned new investment in Russia by a US person; EO 14066, which on March 8 banned new investment in the Russian energy sector by a US person; and EO 14068, which on March 11 banned new investment in any sector of the Russian economy determined by the Secretary of the Treasury, in connection with the Secretary of State. Most of the FAQs clarify the concepts specified in these Executive Orders. FAQ 1049 defines ”investment” for the purpose of Executive Orders 14071, 14066, and 14068 as the commitment of capital or other assets for the purpose of generating returns or appreciation. It further clarifies that a “new” investment is one made on or after the respective effective dates of the Investment Ban EOs, i.e., March 8, March 11, and April 6, 2022 (collectively, the “Cutoff Dates“). This includes commitments (1) entered into on or after the Cutoff Dates and (2) made on or after the Cutoff Dates by exercising rights under an agreement concluded before the Cutoff Dates. The “maintenance” of an investment in Russia made before the Cutoff Dates does not constitute a new investment. This FAQ also includes a list of transactions that OFAC considers to be “new investments” and a list of activities that OFAC does not consider to be “new investments.” Transactions that OFAC considers to be “new investment” for the purposes of the respective E.O. prohibitions include: - The purchase or acquisition of real estate in Russia, other than for noncommercial, personal use; - Entry into an agreement requiring the commitment of capital or other assets for the establishment or expansion of projects or operations in Russia, including the formation of joint ventures or other corporate entities in Russia; - Entry into an agreement providing for the participation in royalties or ongoing profits in Russia; - The lending of funds to persons located in Russia for commercial purposes, including when such funds are intended to be used to fund a new or expanded project or operation in Russia; - The purchase of an equity interest in an entity located in Russia; - The purchase or acquisition of rights to natural resources or exploitation thereof in Russia. Examples of transactions that OFAC does not consider to be “new investment” for the purposes of the respective E.O. prohibitions include: - Entry into, performance of, or financing of a contract, pursuant to ordinary commercial sales terms, to sell or purchase goods, services, or technology to or from an entity in Russia (e.g., a payment of an invoice for goods, where payment is made within the contracted time period and such payment does not involve participation in royalties or ongoing profits); - Maintenance of an investment in Russia, where the investment was made prior to the effective date of the respective E.O. prohibitions, including maintenance of pre-existing entities, projects, or operations, including associated tangible property, in Russia; - Wind down or divestment of a pre-existing investment, such as a pre-existing investment in an entity, project, or operation, including any associated tangible property, located in Russia. FAQ 1050 clarifies that the three Executive Orders banning “new investment” in Russia exclude from the scope of prohibited new investment “the maintenance of investments in the Russian Federation that were made prior to the effective dates of the respective [ ] prohibitions (‘pre-existing projects or operations’)". FAQ 1050 provides guidance on the meaning of “maintenance of investments” and includes a list of activities that are considered maintenance of investments and thus not subject to the prohibitions under the Investment Ban EOs. Generally, “maintenance” includes all transactions (including performing under or modifying pre-existing agreements and entering into new agreements) that are ordinarily incident to performing under an existing agreement, including transactions that ensure continuity of pre-existing projects or operations in Russia, including paying employees, suppliers, landlords, lenders, and partners; preserving and providing for the upkeep of pre-existing tangible property in Russia; and “activities associated with” maintaining pre-existing capital investments or equity investments. In contrast, expansion of Pre-Existing Agreements would not be considered “maintenance.” “Maintenance” of investments includes: - Transactions to ensure continuity of pre-existing projects or operations located in Russia, including payments to employees, suppliers, landlords, lenders, and partners; - The preservation and upkeep of pre-existing tangible property in Russia; - Activities associated with maintaining pre-existing capital investments or equity investments. FAQ 1052 explains that US persons may continue to fund their subsidiaries and affiliates with respect to projects or operations located in Russia, so long as those activities are consistent with “maintenance” and do not expand pre-existing projects or operations. FAQ 1054 clarifies that US persons are prohibited from purchasing both new and existing debt and equity securities issued by Russian entities but are not required to sell or divest such previously acquired debt and securities. According to FAQ 1054, the Investment Ban EOs do not prohibit the sale or divestment of — or facilitating the sale or divestment of — debt or equity securities issued by an entity in Russia to a non-US person. The FAQ also states that a US person may continue to hold such previously acquired securities, and to convert depositary receipts to underlying local shares non-sanctioned Russian issuers consistent with Investment Ban EOs. This interpretation, as a general matter, prohibits US persons from engaging in secondary market trading in pre-existing bonds and debt issued by Russian companies. Further, FAQ 1054 clarifies that US persons are not prohibited from investing in a US fund that contains debt or equity securities issued by Russian entities, so long as these holdings do not constitute a predominant share by value of debt or equity securities issued by Russian entities. FAQ 1054 does not define what a “predominant share” means in this context, but common readings in other sanctions programs include treating “predominance” as a majority share or as the single largest share. FAQ 1055 clarifies that the bans on “new investment” do not prohibit US persons from lending funds to, or purchasing an equity interest in, entities located outside of Russia, assuming two conditions are met: (1) the funds are not specifically intended for new projects or operations in Russia and (2) the entity located outside of Russia generates revenue that is “not predominantly derived from its investments” in Russia. This FAQ generally confirms the permissibility of engaging in large M&A transactions that may include a small Russian operation within the deal perimeter. Link to the original

The prohibitions apply except to the extent provided by statutes, or in regulations, orders, directives, or licenses that may be issued pursuant to this order, and notwithstanding any contract entered into or license or permit granted prior to the date of this order.
FAQ 1051 clarifies that the prohibitions on “new investment” do not prohibit the export or import of goods, services, or technology, or related sales or purchases, to or from Russia, provided that such transactions follow ordinary commercial sales terms (e.g., a payment of an invoice for goods made within the contracted time period, where such payment does not involve ongoing participation in royalties or ongoing profits). Furthermore, traditional trade finance products (e.g., commercial letters of credit and documentary collections) may be used in support of such transactions. Such transactions can be supported through traditional trade finance products, including commercial letters of credit and documentary collections. U.S. persons are not prohibited pursuant to the respective E.O.s from entering into new contracts or agreements for such transactions.
FAQ 1053 provides that the bans on “new investment” do not prohibit transactions related to the divestment or the facilitation of divestment of pre-existing investments, including a pre-existing investment in an entity, project, or operation in Russia. Such transactions may not involve a blocked person or otherwise prohibited transactions unless exempt or authorized by OFAC. US persons (e.g., financial institutions) may also facilitate a seller to wind down or divest its pre-existing investment in Russia, but are prohibited from facilitating the acquisition of an equity interest in an entity located in Russia. EO 14066, EO 14068, and EO 14071 prohibit any approval, financing, facilitation, or guarantee by a US person, wherever located, of a transaction by a foreign person where the transaction by that foreign person would be prohibited if performed by a United States person or within the US. Such provisions do not prohibit U.S. persons from facilitating the wind down or divestment of an existing investment in a project or operation in Russia. For example, a U.S. financial institution is not prohibited from advising a client that seeks to divest from a project or operation in the Russian Federation (i.e., the seller in a transaction). However, a U.S. person is prohibited from providing any approval, financing, facilitation, or guarantee to a non-U.S. person that seeks to invest in a project or operation in the Russian Federation (i.e., the buyer in such a transaction).

06.04.2022