General Note Pertaining to U.S. Person Engagement in Transactions Incident to Transactions by Foreign Persons (System Ed. Note)

Last substantive commentary amendment:
Jun. 15 2023

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TURBOFAC Commentary (4755 words)

General Note and Associated Matrix Pertaining to U.S. Person Engagement in Transactions Incident to Transactions by Foreign Persons (System Ed. Note)

1) BACKGROUND


The Scenario Matrix (available upon request) analyzes a wide variety of scenarios pertaining to U.S. Person engagement in transactions ancillary to underlying transactions by foreign persons. The extent to which U.S. persons may, in general, engage in transactions incident to some other underlying transactions is a question of paramount importance in sanctions law generally, particularly given OFAC's emphasis on enforcement with respect to banks, who by their nature are primarily involved in the engagement of transactions "ordinarily incident" to some other, underlying transaction. This note addresses two narrow issues related to transactions incident to underlying transactions of foreign persons, but the substance overlaps in part with the General Note on the terms "Exempt," "Authorized," "Licensed," "Prohibited, "Not Prohibited" and...