OFAC Releases Three New General Licenses for Crimea

By Christopher R. Wall, Stephan E. Becker, Nancy Fischer, Aaron R. Hutman and Stephanie J. Rohrer

The Office of Foreign Assets Control issued three general licenses today authorizing certain activities that would otherwise be prohibited by Executive Order 13685. This Executive Order became effective on December 19, 2014, and broadly prohibited new investments in, imports to, and exports from the Crimea region of Ukraine. Companies were permitted a wind-down period under certain circumstances through the start of February 1, 2015, pursuant to earlier General License 5. Today’s general licenses authorize specific transactions in the following three areas:

• Non-Commercial Personal Remittances – General License 6 authorizes transactions including the sending/receipt by U.S. persons to/from the Crimea or on behalf of a person ordinarily resident in the Crimea region. It also authorizes certain financial institutions to process those transfers of funds. This does not include charitable donations to an entity or funds transfers used to support the operation of a business, even if family-owned. Additionally, U.S. persons are authorized to hand carry funds to individuals in the Crimean region, or who are ordinarily resident there, provided that it is not done on behalf of a third party. This does not authorize transactions with persons whose property and interests in property are blocked pursuant to Ukraine-related Executive Orders 13660, 13661, 13662 or 13685.
• Operations of Bank Accounts – General License 7 authorizes U.S. financial institutions to operate a personal bank accounts for persons ordinarily resident in the Crimea region provided that the transactions are solely for personal use and do not involve transfers to/from the Crimea region, or benefit persons ordinarily resident in the Crimea region, unless qualifying as personal remittances authorized by General License 6. This does not authorize transactions with persons whose property and interests in property are blocked pursuant to the Ukraine-related Executive Orders.
• Telecommunications and Mail – General License 8 authorizes all transactions with respect to the receipt and transmission of telecommunications involving the Crimea region, so long as no payments involve a person whose property and interests in property are blocked pursuant to the Ukraine-related Executive Orders. However, it does not authorize the provision, sale or lease of telecommunications equipment or technology, or capacity on telecommunications transmission facilities (such as satellite or terrestrial network activity). The transactions of common carriers incident to mail and package service between the United States and the Crimea region are authorized, provided that the importation/exportation is not prohibited by Executive Order 13685, or it is otherwise authorized.

For guidance on legal issues involving Ukraine-Russia sanctions, contact any of the above authors, or any of the professionals in Pillsbury’s International Trade Group.