OFAC Enforcement - Tung Tai Group

Ed. Note: if you’re new to TURBOFAC, please take note that the text string filtration function generally shouldn’t be used for terms such as “ordinarily resident,” “causing” or “new debt”. For research on the meaning of words and phrases such as those, i.e. terms central to the key legal issues in sanctions law that appear on a cross-programmatic basis, you’re typically better off locating and checking the appropriate box in the “Key Legal Issues” search category, which will limit the results to those that have been manually assessed as being relevant for the interpretation of the terms at issue.

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).

Note in addition that the same applies to text string searches such as “14071” (if you’re looking for items related to EO 14071). By typing “14071” in the “Find a Search Filter” field up top, you will be able to instantly narrow the results down to items manually assessed as relating to EO 14071. Ditto terms such as “515.204” or “Iran General License G” (try the “Discrete Legal Provision” search category). Please contact [email protected] or [email protected] with any questions on search results and efficiency.

Please click "Apply Text String Filters" again after clicking the "Close" button immediately below.

TURBOFAC Commentary (255 words)

Notes:

1) It is not clear whether the contract was actually with a Cuban counterparty or a person acting on a Cuban person's behalf, or whether it was for the purchase of Cuban-origin scrap metal located in a third country. If a Cuban was a party to the contract, the legal basis for the violation is fairly straightforward, as a blocked person has an "interest" in all contracts to which it is a party, and entering into such contracts constitute a dealing in property in which a blocked person has an interest.

If, however, the contract was for the purchase of Cuban-origin scrap mental located in and owned by a non-sanctioned person, the legal basis for the violation becomes less clear. Dealings in Cuban origin products are prohibited by 515.204. It is not clear whether OFAC would consider Cuba itself of have had an “interest” in the contract, in violation of 515.201(a), or whether it considered entering into the contract to rise to the level of an attempt to violate 515.204. If there was no Cuban party to the contract, this would be the first—and from 2006 through at least 12/2020 only—time that an enforcement action was based solely on the entering into a contract when a sanctioned party was not a direct or indirect counterparty to the transaction.

Refer to General Note and Associated Scenario Matrix re: the Legal Status of Discussions, Negotiations, Contracts and other Pre-transactional Activities (System Ed. Note) for further discussion on this issue.

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Civil Enforcement Information - Tung Tai Group

TURBOFAC Commentary (255 words)