US Sectoral Sanctions

CAATSA / Guidances / Lists (cont'd) See a reported Jan. 2020 Finnish court decision dismissing claim by Boris Rotenberg, a US-designated SDN, that certain Scandinavian banks refused to serve his Euro accounts And a similar (Sept. 2019) English court judgement that upheld a bank's secondary sanctions risk argument against (non-USD) payment to creditor (a Vekselberg-affiliated entity); and also reported new Dec. 2020 Swiss court ruling against same Vekselberg affiliate (involving USD deposit at Swiss bank - so, involved primary sanctions) See also interesting 2018 English court judgement in the Mamancochet case involving claim vs. UK insurers controlled by US persons on Iranian insured loss Also a Singapore arbitration filed by Mordashov-owned Power Machines ("PM") vs. Petrovietnam ("PV" - Vietnam's state oil & gas co.) – per Nov. 2019 press report - the dispute relates to Vietnam thermal power plant project on which PM is general contractor PV evidently stopped paying, on the basis of secondary sanctions risk, after PM was SDN-designated in Jan. 2018 (re turbines to Crimea scandal - see slide 41); a US heavy equipment supplier is reported to have cancelled its contract with PM (and various int'l banks reported to decline further project payments involving PM), on same basis and see Jan. 2020 press report that PM willing to carry on with project per non-USD payments But see newest English court decision rejecting loan debtor PDVSA's sanctions defense argument for non- payment: seen as "return to orthodoxy" under English law - and also the recent French court decision re US secondary sanctions (both links at slide 14) Note also this series of reported European court cases holding that European cos. refusal to perform under contracts (e.g., with an Iran or Cuba entity) for fear of exposure to US secondary sanctions may well not be justified by force majeure - and may also violate EU Blocking Statute including April 2020 Dutch court decision in the PGP case (see report) Note: there is still a CAATSA exemption for Russian suppliers for NASA or DoD space launches And note the Russian counter-measures enacted in response to CAATSA and the April 2018 SDN designations - and more still to come? (see slides 85-89 below) Morgan Lewis 00 60

View entire presentation