Compliance Communiqué
Sanctions Guidance for the Maritime Shipping Industry
October 31, 2024
The Office of Foreign Assets Control (OFAC) is responsible for administering and enforcing economic sanctions against targeted foreign countries, geographic regions, entities, and individuals to further U.S. foreign policy and national security goals. All U.S. persons[1] must comply with OFAC sanctions. OFAC strongly encourages organizations subject to U.S. jurisdiction, as well as foreign entities that conduct business in or with the United States, U.S. persons, or using U.S.-origin goods or services, to employ a risk-based approach to sanctions compliance.[2]
Maritime sector stakeholders, including commodities brokers, insurers, ship management service providers, shipbroking companies, and port authorities, are often at the forefront of the sanctions compliance landscape as malign actors in the industry employ increasingly sophisticated deceptive practices to evade sanctions. To address risks such as the manipulation of vessel location data, document falsification,...
1) As noted in FN 3, this guidance supplements OFAC’s 2020 Sanctions Advisory for the Maritime Industry, Energy and Metals Sectors, and Related Communities. Most “advisories” and “alerts” merely serve to illustrate evasion trends to watch out for; this “Compliance Communiqué” is a bit different insofar as (i) it gives concrete examples of common factual situations and makes very clear what OFAC’s diligence expectations are in those situations (i.e. gives a sense for when OFAC would regard a regulated person as having a “reason to know” of sanctions-implicating facts for enforcement purposes), and (ii) offers some implicit statements on the scope and operation of certain aspects of the law, as described further below.
2) Comments in re: “Deceptive shipping practices to conceal sanctions nexus” - “Causing” and “Attempt”
“Causing” and “Attempt” - OFAC describes a situation in which a (presumably)...