OFAC FAQ (Current) # 818 - Rosneft Trading S.A. and TNK Trading International S.A.

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 (340 words)

Notes:

1) See Venezuela 36, and comments thereto. Venezuela GL 38 is a straightforward "wind down" GL, which does not include an authorization for the "maintenance" of operations. The lack of a “maintenance” component signals that OFAC has not been presented with a proposal by CEIEC that it considers likely to result in the de-listing of the blocked entity.

Note that OFAC says that "Non-U.S. persons may wind down transactions with Rosneft Trading S.A. without exposure to sanctions under E.O. 13850." This is a reference to the use of EO 13850 as a "quasi secondary sanctions" authority, not the standard blocking prohibitions of the . In other words, a non-U.S. person may deal with Rosneft Trading S.A. without being deemed to have "materially assisted" that entity in a way that can result in blocking pursuant to Sec. 1(a)(iii) of EO 13850. Non-U.S. persons are not directly subject to the blocking prohibitions that are partially suspended by Venezuela GL 36.

2) There is nothing that legally requires OFAC to harmonize the scope of its blocking prohibitions with the scope of the activities that can result in derivative designations, but as a matter of practice OFAC does not designate non-U.S. persons for dealings with blocked persons if those dealings would be exempt or authorized if they were engaged in directly by U.S. persons. This FAQ reflects that general practice, by specifying that an activity will not result in derivative designation if it would qualify for the wind down general license if engaged in directly by a U.S. person. For more on that issue, refer to General Note on Secondary Sanctions and “Derivative Designation” Criteria; Identification of the Gap Between the Theoretical and Practical Scopes of Authorities Targeting Transactions with no U.S. Nexus; Enforcement Risk Management.

3) FAQ amended on 12 March 2020 to account for the blocking of TNK Trading International S.A.

4) See generally Examples of Transactions Deemed to be, and not to be, Within the Scope of the Standard "Wind-down" and "Maintenance" GLs

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OFAC FAQ (Current) # 818 - Rosneft Trading S.A. and TNK Trading International S.A.

TURBOFAC Commentary (340 words)