compliance practices for exporters massachusetts export center 2015 export expo december 11, 2015...
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Compliance Practices for Exporters
Massachusetts Export Center 2015 Export Expo
December 11, 2015
Frank BoudraOffice of Foreign Assets Control
Agenda
• What is OFAC?• Best practices for compliance• The licensing process• Recent updates: Iran, Cuba, Crimea, and
Ukraine• Enforcement Guidelines• Useful Resources
What is OFAC?
Office of Foreign Assets Control (OFAC)U.S. Department of the Treasury
OFAC administers and enforces economic and trade sanctions against targeted:
• Foreign governments • Individuals • Entities • Practices
Jurisdiction• Individuals, located anywhere in the world, doing business in the United
States or through U.S. persons
• Corporations, located anywhere in the world, doing business in the United States or through U.S. persons
• Transactions:– Transactions by foreign persons to the extent that they involve the
United States;– Transactions in property of a blocked person that comes within the
United States;– In limited circumstances, transactions involving controlled U.S.-origin
goods or technology.
The Specially Designated Nationals (SDN) List
OFAC’s prohibited parties list
Currently, over 5,800 individuals and entities identified by OFAC
Individuals, entities, vessels, banks all over the globe with whom or with which transactions are prohibited
UPDATED FREQUENTLY
Sanctions List Searchwww.treasury.gov/SDN
Agenda
• What is OFAC?• Best practices for compliance• The licensing process
OFAC Compliance Program
OFAC Compliance Program
• Risk Assessment• Internal Controls• Testing/Audit• Responsible Individual(s)• Training
Risk Assessment
Internal Controls – Document Review
Internal Controls – Document Review
Internal Controls/Due Diligence
Sanctions ProgramsComprehensive ProgramsSudan, Cuba, Syria, Iran (ITSR and IFSR), Ukraine/Russia-related (Crimea)
Limited ProgramsBurma (Myanmar), Conflict Diamonds, North Korea, Ukraine/Russia-related (Sectorial Sanctions)
List-Based Programs(Activity): Counter-Terrorism, Non-Proliferation, Counter Narcotics Trafficking, Transnational Criminal Organizations, Somali Piracy, Grave Human Rights Abuses Via Information Technology, Foreign Sanctions Evaders
(Regime): Balkans, Belarus, Burundi, Cote D’Ivoire, Democratic Republic of the Congo, Iraq, Lebanon, Libya, South Sudan-Related Sanctions, Ukraine/Russia-related, Venezuela-Related Sanctions, Yemen-Related Sanctions, Zimbabwe
OFAC Terminology: Licenses
General License• Regulatory provision authorizing otherwise prohibited
transactions • No separate authorization necessary• Issued into the regulations or on OFAC’s website
Specific License• Authorization from OFAC issued to a specific person(s) • Allows a specific activity that would otherwise be prohibited
Agenda
• What is OFAC?• Best practices for compliance• The licensing process• Recent updates: Iran, Cuba, Crimea, and
Ukraine
Iran Highlights
Examples: General Licenses*
• Gifts• Patents, Trademarks
& Copyrights• Household goods• Telecommunications
and Mail
• Legal services• Personal remittances• Official business of
certain International Organizations
• Sale of real property in Iran
*Not a comprehensive list and adhering to certain conditions
Exports of Food, Medicine &Medical Devices
• Regulations allow for the export of food, medicine & medical devices to Iran
• Must fit the regulation’s definition• Must not be destined for certain prohibited
parties • Anything outside these parameters must be
authorized by a specific license.
Applying for a Specific License
• Important information to remember to include
• Applicant information• Banks• Brokers• Purchasing agents• End-users• Shipment terms• Payment mechanism
• http://www.treasury.gov/resource-center/sanctions/Pages/licensing.aspx
Joint Plan of Action (JPOA)• Limited, temporary, and reversible sanctions relief in effect from January
20, 2014, to June 30, 2015• Civil aviation safety statement of licensing policy• None of the U.S. trade sanctions that prohibit U.S. companies, including
their foreign subsidiaries, from engaging in trade with Iran have been altered, other than in the statement of licensing policy relating to civil aviation safety
Cuba Updates
Cuba Changes
• Travel• Travel and Carrier Services• Insurance• Importation of Goods• Telecommunications• Consumer Communications
Devices• Financial services• Remittances• Third-Country Effects
• Small Business Growth• Cash in Advance• Supporting Diplomatic
Relations and Official USG Business
• Support for the Cuban People
• Gift Parcels• Liberalizing License
Application Review Policy
January 15, 2015
Cuba Changes
• Travel• Travel and Carrier Services• Telecommunications• Consumer Communications Devices• Third-Country Effects• Cash in Advance
Crimea
Crimea- E.O. 13685
• Prohibits new investment in Crimea• Prohibits imports or exports to or from the
U.S. to Crimea, directly or indirectly• Prohibited facilitation
Crimea- E.O. 13685• General Licenses
– GL 4: Export or reexport of agricultural commodities, medicine, and medical supplies (including replacement parts)
– GL 6: Noncommercial, Personal Remittances Authorized– GL 7: Operation of Accounts Authorized– GL 8: Transactions Related to Telecommunications and
Mail Authorized – GL 9: Exportation of Certain Services and Software Incident
to Internet-Based Communications Authorized
Ukraine/Russia-related Sanctions(List-based)
Ukraine-related Sanctions(List-based)
E.O. 13622 Directive 1
E.O. 13622Directive 1
E.O. 13622 Directive 2
E.O. 13622 Directive 2
E.O. 13622 Directive 3
E.O. 13622 Directive 4
E.O. 13622 Directive 4
Agenda
• What is OFAC?• Best practices for compliance• The licensing process• Recent updates: Iran, Cuba, Crimea, and
Ukraine• Useful Resources
OFAC’s Website: www.treasury.gov/ofac
Search the List
Read through the FAQ
See recent actions
Contact Information
OFAC Compliance Division1-202-622-2490 [email protected]
OFAC Licensing Division1-202-622-2480http://www.treasury.gov/resource-center/sanctions/Pages/licensing.aspx