934. Are the United Nations and the U.S. government permitted to conduct stabilization and early recovery-related activities and transactions involving Syria? Does this apply to their contractors and grantees as well?
Yes. The Syrian Sanctions Regulations (SySR) § 542.513 authorize, subject to certain conditions, the United Nations, its Specialized Agencies, Programmes, Funds, and Related Organizations and their employees, contractors, or grantees to engage in all transactions and activities in support of their official business in Syria, including any stabilization and early recovery-related activities and transactions in support of their official business. This authorization applies to all employees, grantees, and contractors carrying out the official business of the United Nations, its Specialized Agencies, Programmes, Funds, and Related Organizations, including nongovernmental organizations (NGOs) and private sector entities that are acting as grantees or contractors. Please be aware that grantees or contractors conducting activities and transactions authorized under § 542.513 must provide a copy of their contract or grant with the United Nations, or its specialized Agencies, Programmes, Funds, and Related Organizations to any U.S. person, including U.S. financial institutions processing funds transfers in support of the authorized activities, before the U.S. person engages in or facilitates any transaction or activity.
In addition, § 542.211(d) and the general license at § 542.522 exempt and authorize, respectively, subject to certain conditions, the Federal Government and its employees, grantees, or contractors to engage in all transactions in support of their official business in Syria, including any stabilization and early recovery-related activities and transactions in support of their official business. This exemption and authorization apply to all employees, grantees, and contractors carrying out the official business of the Federal Government, including NGOs and private sector entities that are acting as grantees or contractors. Please be aware that grantees or contractors conducting transactions authorized under § 542.522 must provide a copy of their grant or contract with the Federal Government to any U.S. person, including U.S. financial institutions processing funds transfers in support of the authorized activities, before the U.S. person engages in or facilitates any transaction.
For NGOs that are not acting as grantees or contractors of the aforementioned international organizations or the Federal Government, please see § 542.516 for authorizations under the SySR related to the export or reexport of certain services to Syria in support of certain NGO activities.
Separately, non-U.S. persons, including NGOs, private sector entities, and foreign financial institutions facilitating or assisting in the aforementioned activities, do not risk exposure to U.S. secondary sanctions pursuant to the Caesar Syria Civilian Protection Act of 2019 for engaging in the above activities that are authorized or exempt for U.S. persons under the SySR. Please see FAQ 884 for additional information.
Please note that this guidance does not apply to transactions and activities that may be subject to sanctions under other sanctions programs administered by OFAC (e.g., transactions with persons blocked under OFAC’s counterterrorism authority (E.O. 13224, as amended) or OFAC’s Syria-related authority (E.O. 13894)), unless exempt or otherwise authorized by OFAC.
Date Released
November 8, 2021
1) In general, this FAQ appears to be of the genre of FAQs issued in response to general inquiries related to a given subject, as opposed to an FAQ issued to clarify otherwise vague aspects of the law. The “official business” provisions addressed (542.513, 542.211(d) and 542.522) clearly apply to the “contractors and grantees” of the United Nations and the U.S. government.
OFAC has issued very little public guidance that addresses the “official business” provisions (which are similarly scoped cross-programmatically and come in the form of GLs and exemptions). For an in-depth discussion of the contours of the scope of the provisions, as addressed by OFAC in a number of unpublished guidance letters, see General Note on Exemptions and General Licenses for the “Official Business” of the U.S. Government (and/or United Nations) and Employees, Contractors, or Grantees Thereof.
To the extent that the FAQ could be said to constitute “interpretive guidance” there are a few statements that are now on the public record that confirm interpretations contained in the Research System guidance letters. One is that the “official business” provision applies to “Federal Government and its employees, grantees, or contractors,” implying that activities of the “Federal Government” are no less authorized than transactions of “employees, grantees, or contractors” of the Federal Government. This may appear obvious from a policy standpoint, but the wording of the standard “official business” provision refers to transactions “for the conduct of the official business of the Federal Government by employees, grantees, or contractors thereof,” which leaves vague the question of whether the authorizations cover transactions ordinarily incident to those of the Federal Government when performed by persons other than those meeting the definitions of “employees, grantees, or contractors.” They do (refer to the System Note).
In addition, OFAC distinguishes between 542.522 (GL) and 542.211(d) (exemption) in a way that suggests that the “must show contract” requirement of 542.522 only applies where it is explicit found, rather than something that is implicit in all “official business” provisions. Accord Case No. SY-2019-364717-1.
Finally, it is worth calling attention to the reference to “stabilization and early recovery-related activities and transactions in support of their official business”. Without any guidance at all, one might be inclined to read “official business of” the UN/USG restrictively. However, the general license at 542.522 extends to transactions “ordinarily incident” to those covered by 542.522, and OFAC has never suggested that the “official business” provisions are broader or narrower depending on whether they come in the form of an exemption or GL.
2) While EO 13224 and the GTSR contain no broad "official business" provision, see Syria-related GL 1 (Official Business of the United States Government) (for EO 13894). A number of Syrian government-related persons are blocked pursuant to EO 13894. One might be inclined to read the FAQ as implying that OFAC would not have a favorable licensing policy for "stabilization and early recovery-related activities" of the UN or NGOs that are prohibited by EO 13894.
3) Refer generally to General Note on "Counterfactual Secondary Sanctions and Derivative Designation Safe Harbors" in Certain OFAC Guidance and FAQs (System Ed. Note).