1051. Is the export to the Russian Federation or import from the Russian Federation of goods, services, or technology considered “new investment” for the purposes of Russia-related Executive Order (E.O.) 14066, E.O. 14068, or E.O. 14071 (collectively, “the respective E.O.s”)?
The prohibitions on “new investment” pursuant to the respective E.O.s do not prohibit the export or import of goods, services, or technology, or related sales or purchases, to or from the Russian Federation, provided that such transaction is made pursuant to 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) (see FAQ 1049). 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...
1) This FAQ appears to apply the new definition of "new investment" at FAQ # 1049. "[T]he commitment of capital or other assets for the purpose of generating returns or appreciation".
An ordinary purchase of goods may well be done for the "purpose of generating returns or appreciation" with respect to a business in general, but for "new investment" purposes, it appears as though the "returns or appreciation" must be generated by the actual thing that the contributor of capital or other assets gets in return for such assets.
2) What happens if a payment is not "made within the contracted time period"? Under what circumstances would this mean that a purchase of goods is "new investment"?
* Refer generally to General Note on the Russia-related “New Investment” Prohibitions.