General Note on U.S. Person Employees Working for Non-U.S. Person Companies With Sanctions-Implicating Business (System Ed. Note)

Last substantive commentary amendment:
Dec. 19 2024

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TURBOFAC Commentary (1746 words)

General Note on U.S. Person Employees Working for Non-U.S. Person Companies With Sanctions-Implicating Business (System Ed. Note)

1) Background

When a U.S. person lends funds or exports goods to a non-sanctioned third-country company that is known to have sanctions-implicating business, this is generally not prohibited (as “facilitation” or otherwise) unless (i) the funds are specifically intended for sanctions implicating activity / the goods are specifically intended for a sanctioned destination, or (ii) the third country company otherwise derives the predominant portion of its revenue from sanctions-implicating business / sells the goods at issue to sanctioned persons. Compare General Note on “Indirect Financing,” or Investments in Third Country Companies that do Business with Sanctioned Parties (funds) and Guidance on Transshipments to Iran (goods). Likewise, OFAC has also said no license is required to export goods to third countries when such goods...