Russia-related New Investment System Note

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TURBOFAC Commentary (6836 words)

General Note on the Russia-related “New Investment” Prohibitions

 

I. Overview

II. The Meaning of “Investment” in New Investment

III. The Meaning of “New” in New Investment

IV. The Meaning of “in the Russian Federation”

V. The Notion of “Facilitation” of an Otherwise Prohibited New Investment

VI. The Notion of an “Indirect” New Investment (Third-country Debt/Equity)

VII. Licenses

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I. OVERVIEW

 

Each of the broad, IEEPA-based embargoes active as of 9-30-2022 contain a prohibition on "new investment" in the embargoed country or territory. See 510.209 (NKSR), 542.206 (SySR), 560.207 (ITSR), 589.206 (Crimea, URSR) and EO 14065 (DNR/LNR, no regulations as of 9-30-2022). The "new investment" prohibitions applicable in the embargo context are typically identically worded, where what is prohibited is new investment "in" the sanctioned area. The ITSR version is substantially different.

 

In addition to the “new investment” prohibitions that apply to...