Department of Commerce, Department of the Treasury, and Department of Justice Tri-Seal Compliance Note:
Obligations of foreign-based persons to comply with U.S. sanctions and export control laws
OVERVIEW
Today’s increasingly interconnected global marketplace offers unprecedented opportunities for companies around the world to trade with the United States and one another, contributing to economic growth. At the same time, malign regimes and other bad actors may attempt to misuse the commercial and financial channels that facilitate foreign trade to acquire goods, technology, and services that risk undermining U.S. national security and foreign policy and that challenge global peace and prosperity. In response to such risks, the United States has put in place robust sanctions and export controls to restrict the ability of sanctioned actors to misuse the U.S. financial and commercial system in advance of malign activities.
These measures can create legal exposure not only...
This Compliance Note does not appear to break new ground as it relates to sanctions related obligations of non-U.S. persons. The sanctions portion provides a general overview of bases of liability for non-U.S. persons, and recaps some notable enforcement actions against non-U.S. persons. Two statements, which also appeared in prior advisories, are worth noting.
First, the Note says “non-U.S. persons are prohibited from causing or conspiring to cause U.S. persons to wittingly or unwittingly violate U.S. sanctions, as well as engaging in conduct that evades U.S. sanctions.” Note that OFAC has (as of the date of the issuance of the compliance note) only invoked "causing" as a theory of liability in cases where a non-U.S. person caused a U.S. person to "unwittingly" violate U.S. sanctions (e.g. ship an item without knowing the end user, process a transaction without understanding the sanctions-implicating nature of...