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ES Sanctions Developments - Monthly Round-Up (June 2021)

  • United Kingdom
  • Europe
  • USA
  • Fraud and financial crime
  • Litigation and dispute management
  • Sanctions

06-07-2021

The EU, UK, US and Canada impose sanctions on Belarus

The UK, EU, US and Canada have taken a unified step by imposing further sanctions against Belarus. Their joint statement made clear that the sanctions were imposed due to the continued human rights violations and oppressions carried out by the Lukashenko regime, such as the forced landing of the Ryanair flight 3978 and the detention of Mr Raman Pratasevich and Ms Sofia Sapega.

On 21 June 2021, sanctions were imposed against additional individuals and entities in Belarus, including travel bans and asset freezes, and further sanctions were then imposed by the EU on 24 June 2021. These sanctions have a significant impact on the insurance, oil and gas, telecoms and financial services sectors. For a detailed overview of the new sanctions imposed, please see our recent briefing here.

OFSI publishes updated guidance on Russia sanctions

On 23 June 2021, OFSI published updated guidance relating to the measures imposed under the Russia (Sanctions) (EU Exit) Regulations 2019 (the “Regulations”). The updated guidance focuses on the financial and investment restrictions and includes seven additional frequently asked questions (“FAQs”), which further clarify key elements of the Regulations such as:

  • the exception for the financing of “non-restricted trade” under Regulation 59 of the Regulations (FAQ 18);
  • the ability to sell a loan or credit claim that was extended prior to 12 September 2014 with a maturity exceeding 30 days to a targeted entity (FAQ 19);
  • provision of collateral for intra-group risk mitigation purposes to non-UK subsidiaries (FAQ 20);
  • dealings with depositary receipts in certain circumstances where they are based on equity issued by a targeted entity (FAQ 21);
  • transactions involving cash-settled derivatives (FAQ 22);
  • dealing in old securities in circumstances where new transferable securities were issued and it is impossible to identify which were issued before or after the relevant cut off dates (FAQ 23); and
  • a letter of credit issued after exit day by a targeted entity (FAQ 24)

The updated guidance can be found here.

US, EU and UK impose further sanctions on Myanmar

On 21 June 2021, the EU imposed a third round of sanctions on 8 individuals, 3 economic entities and the War Veterans Organisation relating to the 1 February 2021 military coup in Myanmar/Burma. A total of 43 individuals and 6 entities associated with the coup are now subject to asset freezes, prohibitions on making funds available, and travel bans by the EU.

Additionally, the EU continues to apply an embargo on arms and equipment, an export ban on dual-use goods, export restrictions on equipment for monitoring communications and a prohibition on military training for and military cooperation with the Tatmadaw, the armed forces of Myanmar.

On the same date, the UK published a notice adding Myanmar Pearl Enterprise, Myanmar Timber Enterprise and State Administration Council to its list of designated persons. These entities are now subject to an asset freeze. A total of 23 individuals and 4 entities associated with undermining democracy in Myanmar are now subject to asset freezes by the UK.

On 2 July 2021, the US also announced additional sanctions against 22 individuals and 4 entities connected to the military regime in Myanmar, further enhancing the sanctions already imposed by the US under the Myanmar sanctions program.

In a press statement issued alongside the announcement, the US confirmed its commitment to “promoting accountability for the Burmese military, the SAC, and all those who have provided support for the military coup”. The announcement indicates that the US will continue to increase pressure on the country by way of sanctions until the situation in Myanmar de-escalates.

OFAC issues new COVID-19 related General Licenses and FAQs in respect of Syria, Venezuela, and Iran.

On 17 June 2021, the US Department of the Treasury’s Office of Foreign Assets Control (“OFAC”) issued three new General Licenses, referred to as the COVID-19 related General Licences (the “GLs”), to authorise certain COVID-19-related transactions and activities, as follows:

The new GLs are intended to support governments, international organisations, NGOs, and private sector actors in providing people in these jurisdictions with COVID-19-related assistance. OFAC has also issued six frequently asked questions (FAQs: 906, 907, 908, 909, 910 and 911) to provide additional guidance with respect to the scope and interpretation of the new GLs. The OFAC Recent Action related to this update can be found here.

OFAC previously issued consolidated guidance highlighting the most relevant humanitarian exemptions, exceptions, and authorisations relating to the Iran, Venezuela, North Korea, Syria, Cuba and Ukraine/Russia sanctions programs to assist those seeking to provide assistance during the COVID-19 crisis. The guidance has been updated to include the new GLs and associated FAQs, which expand upon the existing authorisations to cover additional COVID-19 related transactions and activities. A copy of the consolidated guidance can be found here.