Case No. SU-2014-313125-1

Date issued: Jan. 06 2016

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TURBOFAC Commentary (415 words)

Notes:

1) The applicant at issue here was a Switzerland-incorporated entity that was mid-sized (“[a]t its peak, the company employed around 260 people”) and was, from 2007 through the date of issuance of the guidance letter, run by a U.S. person as CEO (see https://www.nau.ch/news/wirtschaft/legacy-pharmaceuticals-switzerland-gmbh-meldet-konkurs-an-65825602). This is a notable guidance letter illustrating the limitations of OFAC’s ordinary primary sanctions prohibitions as they relate to transactions of non-U.S. person entities that have U.S. person senior management, including at the CEO level. In Case No. BEL-2014-310852-1, OFAC makes clear that transactions of a non-U.S. person entity that is a subsidiary of U.S. person entity are not necessarily facilitated by a U.S. parent company solely by virtue of the parent company owning the company. Here, the question is whether the non-U.S. person entity can export goods to then-embargoed Sudan, and OFAC says yes “provided...