OFFICE OF FOREIGN ASSETS CONTROL
Russian Harmful Foreign Activities Sanctions Regulations
31 CFR part 587
GENERAL LICENSE NO. 70
Authorizing the Wind Down of Transactions Involving Joint Stock Company Ural Mining and Metallurgical Company
(a) Except as provided in paragraph (b) of this general license, all transactions prohibited by Executive Order (E.O.) 14024 that are ordinarily incident and necessary to the wind down of any transaction involving Joint Stock Company Ural Mining and Metallurgical Company (UMMC), or any entity in which UMMC owns, directly or indirectly, a 50 percent or greater interest (collectively, the “UMMC Entities”), are authorized through 12:01 a.m. eastern daylight time, October 18, 2023, provided that any payment to a UMMC Entity must be made into a blocked account in accordance with the Russian Harmful Foreign Activities Sanctions Regulations, 31 CFR part 587 (RuHSR).
(b) This general license does not authorize:
(1) Any transactions prohibited by Directive 2 under E.O. 14024, Prohibitions Related to Correspondent or Payable-Through Accounts and Processing of Transactions Involving Certain Foreign Financial Institutions;
(2) Any transactions prohibited by Directive 4 under E.O. 14024, Prohibitions Related to Transactions Involving the Central Bank of the Russian Federation, the National Wealth Fund of the Russian Federation, and the Ministry of Finance of the Russian Federation, as amended; or
(3) Any transactions otherwise prohibited by the RuHSR, including transactions involving any person blocked pursuant to the RuHSR other than the UMMC Entities, unless separately authorized.
Bradley T. Smith
Deputy Director
Office of Foreign Assets Control
Dated: July 20, 2023
1) This is a standard wind-down general license, authorizing the processing of underlying transactions that may not involve U.S. persons (see e.g., FAQ 807), but not including authorizations for the "maintenance" of activities.
2) Refer to the Research System for documents dealing with the scope of the types of transactions that qualify for "wind down" GLs such as this. See in particular Examples of Transactions Deemed to be, and not to be, Within the Scope of the Standard "Wind-down" and "Maintenance" GLs.
3) Read in conjunction with FAQ # 975 and FAQ # 990. FAQ # 990 (no debits to a blocked account on the books of a U.S. financial institution) certainly applies here. This FAQ appears to lend support to the idea that FAQ # 975 (no payments, at least with respect to loans, unless to a blocked account) applies to blocked banks only. This GL has an explicit provision that "any payment to a blocked person must be made into a blocked account located in the United States in accordance with the Russian Harmful Foreign Activities Sanctions Regulations," which suggests that payments are not restricted unless a GL actually contains this restriction. Compare Russia-related General License 24 - Authorizing the Wind Down of Transactions Involving Public Joint Stock Company Alrosa (April 7, 2022), authorizing wind-down transactions involving a diamond industry entity that does not have a "any payment to a blocked person must be made into a blocked account" restriction. For licensing purposes, OFAC may be more willing to issue specific licenses for direct payments to blocked persons when the payment into a blocked account would not serve to discharge a debt under the laws that govern the debt, and would likely result in a U.S. person getting sued.
4) NOTE: This GL excludes all transactions prohibited by other EOs of which the prohibitions are incorporated into the Russian Harmful Foreign Activities Sanctions (including the "new investment" prohibition of EO 14071).