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OFFICE OF FOREIGN ASSETS CONTROL
DETERMINATION PURSUANT TO SECTION 11(a)(ii) OF EXECUTIVE ORDER 14024
Section 11(a)(ii) of Executive Order (E.O.) 14024 of April 15, 2021 (“Blocking Property With Respect To Specified Harmful Foreign Activities of the Government of the Russian Federation”), as amended by E.O. of December 22, 2023 (“Taking Additional Steps With Respect to the Russian Federation’s Harmful Activities”), authorizes the Secretary of the Treasury, in consultation with the Secretary of State and the Secretary of Commerce, to impose sanctions on a foreign financial institution upon determining that the foreign financial institution has conducted or facilitated any significant transaction or transactions, or provided any service, involving Russia’s military-industrial base, including the sale, supply, or transfer, directly or indirectly, to the Russian Federation, of any item or class of items as may be determined by the Secretary of the Treasury, in consultation with the Secretary of...
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1) Refer to comments to EO 14114 for more on section 11 of amended EO 14024. This determination, in conjunction with the underlying authority cited, is notable and unusual for the fact that it envisages the application of secondary sanctions on FFIs for transactions that may well be legal for U.S. person to engage in without a specific license. Contrast the guidance found at General Note on "Counterfactual Secondary Sanctions and Derivative Designation Safe Harbors" in Certain OFAC Guidance and FAQs (System Ed. Note). In general, conduct will not result in sanctions if it can be engaged in by U.S. persons without a specific license, but this appears to not be the case—either as a technical matter or a practical policy matter—as it relates to the facilitation of “critical items” transfers. See also comments to