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US Government Imposes Economic Sanctions on Nicaragua Targeting Certain Individuals

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On November 27, 2018, the President signed Executive Order 13851 targeting Nicaragua entitled “Blocking Property of Certain Persons Contributing to the Situation in Nicaragua” (“Nicaragua EO”) available here.  The US Treasury Department’s Office of Foreign Assets Control (“OFAC”) also issued a press release related to the Nicaragua EO available here, and added two close associates of Nicaraguan President Daniel Ortega to the Specially Designated Nationals and Blocked Persons List (“SDN List”) pursuant to the new Nicaragua EO, the notice for which is available here.  The two new SDNs are the current Vice President of Nicaragua and President Ortega’s wife, Rosario Maria Murillo de Ortega, and President Ortega’s national security adviser, Nestor Moncada Lau.

The Nicaragua EO declares a national emergency with respect to the Government of Nicaragua and was issued in response to the Ortega regime’s crackdown on a popular uprising in the country.  OFAC’s press release advises that the Ortega regime has engaged in rampant corruption, dismantling of democratic institutions, human rights abuses, and exploitation of the people and public resources of Nicaragua for private gain.  The Nicaragua EO allows for the designation as SDNs of those parties that are responsible for, or complicit in, or to have directly or indirectly engaged or attempted to engage in:

(A) serious human rights abuses in Nicaragua;

(B) actions or policies that undermine democratic processes or institutions in Nicaragua;

(C) actions or policies that threaten the peace, security, or stability of Nicaragua;

(D) 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, such as the misappropriation of public asses or expropriation of private assets for personal gain or political purposes, corruption related to government contracts, or bribery.

The Nicaragua EO also authorizes designation of leaders of official Nicaraguan entities involved in the foregoing activities, officials of the Government of Nicaragua, and those that materially assist, sponsor, or provide support to SDNs designated pursuant to the Nicaragua EO.  Individuals designated pursuant to the Nicaragua EO are restricted from entering the United States.

Any property or interests in property of SDNs designated pursuant to the Nicaragua EO that comes within US jurisdiction or possession of a US person must be blocked and reported to OFAC, and US persons are generally prohibited from transacting with any such SDNs or entities 50% or more owned or controlled by SDNs.

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Mr. McMillan's practice involves compliance counseling; compliance programs; licensing; compliance reviews; internal investigations; voluntary disclosures; administrative enforcement actions; criminal investigations; customs inquiries, audits, detentions, and seizures; and trade-compliance due diligence and post-acquisition integration in mergers and acquisitions. His practice includes matters that implicate the US International Traffic in Arms Regulations (ITAR), US Export Administration Regulations (EAR), US National Industrial Security Program (NISP), the US Committee on Foreign Investment in the United States (CFIUS), and equivalent non-US laws. Mr. McMillan regularly advises on and represents clients in matters involving technology, including its control, protection, accidental disclosure, diversion, or unauthorized collection. Mr. McMillan has extensive experience working with companies in the aerospace and defense industry, as well as companies in the Middle East and other parts of Asia.

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Inessa Owens is an associate in the Washington, D.C. office and member of the Firm’s International Trade practice group. She focuses on outbound trade compliance issues, including compliance with the Export Administration Regulations, anti-boycott rules, and economic sanctions administered by the US Treasury Department’s Office of Foreign Assets Control, including those targeting Cuba, Iran, North Korea, Syria, and Russia. She has worked with clients in diverse industries that include finance, pharmaceuticals, and energy.

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Meg's practice involves assisting multinational companies with export compliance related matters, specifically trade sanctions and export control classifications. Additionally, she assists companies with respect to customs laws, anti-boycott laws and other trade regulation issues in the US and abroad. She also helps obtain authorizations from the US government for activities subject to sanctions regulations and US export control regulations, including the Export Administration Regulations and the International Traffic in Arms Regulations. Meg's practice extends to assistance in internal compliance reviews as well as enforcement actions and disclosures necessitated by US government action.

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