OFAC Issues, Updates Guidance on Expanded Iranian Sanctions Authority
The Office of Foreign Assets Control on Dec. 7 issued two new frequently asked questions and updated four additional FAQs related to a January executive order that expanded U.S. sanctions authority against Iran (see 2001100050). The two new FAQs clarify whether transactions related to international organizations and Iran’s participation in international legal proceedings are subject to secondary sanctions.
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In FAQ 855, OFAC clarified that expanded Iranian sanctions authorities, including secondary sanctions, do not apply to transactions for the “official business” of the United Nations, including U.N. agencies, funds, programs and related organizations. OFAC also said certain transactions and activities “involving an Iranian financial institution” blocked under the executive order’s sanctions are authorized by General License L and certain provisions of the Iranian Transactions and Sanctions Regulations.
Non-U.S. persons “are not exposed to sanctions for engaging in transactions and activities involving the Iranian financial sector” that would be authorized for U.S. people under General License L, OFAC said. The agency also said it views certain transactions by non-U.S. persons as “non-sanctionable,” including the “operating expenses or other official business” of international organizations in which Iran is a member. It also said the expenses or business associated with Iran’s missions to international organizations in which it is a member, including “the provision of routine goods and services to such missions or their employees by non-U.S. persons,” is non-sanctionable.
In FAQ 856, OFAC said it provides authorizations for certain transactions and activities relating to the “initiation and conduct of legal proceedings” involving Iran. This includes transactions related to the “defense of individuals in legal proceedings in Iran brought by the Government of Iran, including any arrest, investigation, prosecution, or detention.” Permitted transactions include “reasonable and customary payments” for legal services, bail and bond payments, judicial costs, costs for document production, appearances of witnesses and “payment of experts.”
OFAC also said payments made to Iran involving blocked Iranian people or entities related to “awards, orders, decisions, or settlement of claims” may be subject to sanctions unless they are authorized by General License L. OFAC said it will assess those transactions on a case-by-case basis.
The agency also updated FAQs 830, 831, 832 and 847, which cover sanctions authorizations for humanitarian goods, how OFAC defines sectors of Iran’s economy, certain “significant” goods and services used in those sectors and sanctions risks to non-U.S. persons.