Ofac Issues Regulations Regarding Its Nicaragua Related Sanctions
On September 3, 2019, the Office of Foreign Assets Control (“OFAC”) issued its regulations regarding Executive Order (E.O.) 13851 issued on November 27, 2018 by President Donald J. Trump blocking all property under U.S. jurisdiction of any person determined by the Secretary of the Treasury, in consultation with the Secretary of State: to be responsible for: (i) serious human rights abuses in Nicaragua; (ii) actions or policies that undermine democratic processes or institutions in Nicaragua; (iii) actions or policies that threaten the peace, security, or stability of Nicaragua; (iv) any transaction or series of transactions involving deceptive practices or corruption by, on behalf of, or otherwise related to, the Government of Nicaragua or a current or former official of the Government of Nicaragua; (v) being a leader or official of an entity that has, or whose members have, engaged in serious human rights abuse in Nicaragua; or of an entity whose property has been blocked pursuant to E.O. 13851; (vi) being an official of the Government of Nicaragua, or to have served as an official of the Government of Nicaragua at any time on or after January 10, 2007; (vii) materially assisting, sponsoring, or providing financial, material, or technological support for, or goods or services in support of serious human rights abuses in Nicaragua; or of any person whose property and interests in property are blocked pursuant to E.O. 13851; or (viii) to be owned or controlled by, or to have acted or purported to act for, or on behalf of, directly or indirectly, any person whose property and interests in property are blocked pursuant toE.O. 13851.
In its regulations, OFAC clarifies the following matters: (i) the scope of E.O. 13851’s definitions and prohibitions; (ii) the operations that require an authorization from OFAC and the procedure for obtaining this authorization; (iii) the records and reports that persons under U.S. jurisdiction need to make to comply with E.O. 13851; and (iv) the proceedings that OFAC follows to sanction persons under U.S. jurisdiction that violate E.O. 13.851. Additionally, OFAC regulations define that, from now on, E.O. 13.851 can be enforced by OFAC’s Director and any other person that the Secretary of the Treasury delegates.
On the same date, OFAC announced that these regulations were issued with the purpose of providing immediate guidance to the public regarding its Nicaragua-related sanctions. However, it plans to issue a more comprehensive set of regulations, which may include interpretive guidance, general licenses, and statements of licensing policy.