Morgan Lewis US and Russia Sanctions Update
CAATSA / Guidances / Lists (cont'd)
CAATSA stiffened existing OFAC Directives 1, 2 and 4 (this is essentially for US persons - see slides
17-19)
Directive 1: permissible "new debt" of designated Russian banks was reduced from max. 30 to 14 days
Directive 2: permissible new debt of designated Russian energy cos. was reduced from max. 90 to 60 days
Directive 4: the prohibition on goods / services / technology involvement in deepwater, Arctic offshore or shale
projects was expanded from Russia to worldwide
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but, for outside Russia, applies only to "new" projects (see slide 20 above)
if one or more of the designated Russian energy companies has ≥33% ownership or >50% voting interest
All of this was then implemented by OFAC amendments of the relevant Directives - see slides 17-24 above
Per CAATSA section 223(a), potential expansion of industry coverage of the OFAC sanctions
(beyond financial services, energy, engineering / defense-related) - see FAQ 539 ... but none yet
Requiring review/approval by Congress
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per CAATSA section 216 – before President can terminate or waive existing sanctions (or grant any non-
routine-type license that "significantly alters" foreign policy re Russia)
apparently including SDN delistings - such as those of of En+, RUSAL and EuroSibEnergo in 2019 (Congress
was notified, and opposition was insufficient to block)
Reality check: Despite the "President shall impose" CAATSA sanctions language (see slides 50-53)
to date there has been no case of such imposition on any non-US person save for a few in the cyber-security
and defense sectors - i.e., none yet in the purely civilian-economy space (see slides 40-42 above)
but notable recent secondary sanctions imposed on non-US persons under Venezuela (two Rosneft oil trading
subs.) and Iran (two Chinese entities) sanctions programs (see slide 11)
Morgan Lewis
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