1053. Under the new investment prohibitions of Russia-related Executive Order (E.O.) 14066, E.O. 14068, or E.O. 14071 (collectively, “the respective E.O.s”), are transactions related to divestment in a project or operation in the Russian Federation permissible?
Yes. Transactions related to the divestment or the facilitation of divestment of a pre-existing investment in a project or operation in the Russian Federation are not prohibited by the new investment prohibitions of the respective E.O.s. Such transactions may not involve a blocked person or otherwise prohibited transactions unless exempt or authorized by the Office of Foreign Assets Control (OFAC).
The respective E.O.s prohibit any approval, financing, facilitation, or guarantee by a United States 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 United States. Such provisions do not...
1) These key FAQs describe the ad-hoc "maintenance" exclusion to the “new investment” prohibition, which exist as a distinct ad-hoc exclusion from the exclusion for transactions “related to divestment” (see FAQ 1053).
2) The maintenance FAQs raise a number of interpretive questions. Of particular note:
(i) Does the exclusion for “maintenance” apply, in practice, to “all transactions ordinarily incident to” covered maintenance activities as if there were a general license for all transactions otherwise prohibited that qualify for OFAC’s definition of “maintenance” and were prohibited solely by the “new investment” prohibition?
(ii) Does the limitation of the maintenance exclusion for “expansion” of pre-existing projects apply solely with respect to the intent of the otherwise prohibited commitment of assets at the time they were committed?
(iii) Is the reinvestment of profits from a pre-existing entity necessarily covered under the “maintenance”...