Russia-related General License 72 - Authorizing the Wind Down of Transactions Involving Certain Entities Blocked on September 14, 2023 (September 14, 2023)

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Try typing your search term (“ordinarily resident,” “new debt,” or something else) in the “Find a Search Filter” box at the top of the page, and the corresponding “Key Legal Issues” check box will pop up instantly, if one exists. Once you check the box (e.g. “new debt,” with ~55 results), you can always use the text string filtration function to further refine your search (e.g. by typing “invoice” and narrowing the ~55 results to ~10).

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TURBOFAC Commentary (327 words)

Notes:

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 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).

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Russia-related General License 72 - Authorizing the Wind Down of Transactions Involving Certain Entities Blocked on September 14, 2023 (September 14, 2023)

TURBOFAC Commentary (327 words)