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Foreign Assets Control Regulations for the Financial Community (1988 version)

Date issued: Aug. 01 1988

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FOREIGN ASSETS CONTROL REGULATIONS FOR THE FINANCIAL COMMUNITY

I. Introduction

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V. Terminology

There are a number of key phrases which consistently reappear in Treasury sanctions:

A-Blocking-Also called "freezing," this is a form of controlling assets under U.S. jurisdiction. While title to blocked property remains with the designated country or national, the exercise of the powers and privileges normally associated with ownership is relegated to the U.S. Treasury Department and controlled by OFAC specific licenses. Blocking immediately imposes an across-the board prohibition against transfers or transactions of any kind with regard to the property.

B-Blocked Account-An account with respect to which payments, transfers, withdrawals or other dealings may Department of the Treasury not be made except as licensed by OFAC or otherwise authorized by the Treasury Department.

C-General License-A regulatory provision authorizing certain transactions--not...

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TURBOFAC Commentary (1179 words)

Notes:

1) BLOCKED PERSON "INTEREST" ARISING VIA "CONTRACTUAL CHAIN"

This document is similar to Foreign Assets Control Regulations for Exporters & Importers (2012 version) in structure, but is notable for, among other items, the "Have An Interest In" section, which does not appear in subsequent versions of this or any other document.

OFAC provides two examples of sanctioned governments that have an interest in products produced in their territory (the Cuban cigars and Chinese goods) that were based on court cases in which the sanctioned countries involved had no legal title to the goods at issue, and a third deeming a blocked person to "have an interest" in a transaction between two U.S. parties within the U.S. on the basis of the ultimate destination of the goods. In the cases of the Cuban cigars and Chinese goods, courts upheld challenges to regulations prohibiting trade in...