Moments ago, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) released a two page primer on its position on humanitarian assistance to sanctioned jurisdictions. Although this document is not binding in the sense that it is not a codification of law, it is a clarification of policy. Some key points highlighted are that:
(1) While the U.S. government supports humanitarian assistance, this is generally conditioned on assistance not being directed towards entities that are designated by OFAC or owned or controlled by such entities.
(2) In the case of regions that are under control of individuals who are blocked, the payment of certain fees such as taxes is not necessarily prohibited.
(3) Interestingly, OFAC has also clarified that in certain cases, humanitarian aid may unintentionally wind up in the hands of designated entities but that this is not a focus of its enforcement agenda. This of course, should not be seen as any type of tacit authorization to aid designated entities as that remains prohibited.
The case of humanitarian assistance is one that is causing increasing compliance challenges, particularly due to the dire situation in jurisdictions such as Syria and Iraq where parts of territory are under control of the Islamic State (IS). Furthermore, even in the case of fully sovereign jurisdictions such as Iran, the logistics chain of delivering aid has been made considerably more difficult by the fear of third party actors (such as banks in the United States and third countries) to facilitate even authorized transactions. You may recall this article in Al-Monitor two weeks ago where I was interviewed on this same issue.
As such, those seeking to engage in charitable and humanitarian assistance in sanctioned countries or in areas where exposure to potential violations is high (such as in Iraq) should be particularly careful to (1) understand the scope of U.S. laws; (2) ensure compliance; and (3) educate third party actors and vendors of the legality of their transactions. The latter is a significant part of what I do for many compliance clients.
Leave a Reply