On May 12, 2020, the US Treasury Department’s Office of Foreign Assets Control (“OFAC”) announced the lifting of US sanctions on Nynas AB (“Nynas”) and the related revocation of General License No. 13E (“Authorizing Certain Activities Involving Nynas AB”) (“GL 13E”).  We blogged about last month’s extension of GL 13E here.

Nynas and its subsidiaries were previously subject to US sanctions because Nynas was indirectly owned and controlled by PetrĂ³leos de Venezuela SA (“PdVSA”) and, by extension, the Government of Venezuela (“GOV”).  PdVSA has been considered blocked since its designation as a Specially Designated National (“SDN”) on January 28, 2019 under Executive Order 13850, and the GOV has been considered blocked since comprehensive sanctions were imposed on August 5, 2019 under Executive Order 13884.  The blocking of PdVSA and the GOV also applied to entities owned 50% or more or controlled by such parties, directly or indirectly.  These Venezuela-related Executive Orders were incorporated into the Venezuela Sanctions Regulations (31 C.F.R. Part 591, “VSR”) late last year, as explained in our previous blog post

According to OFAC, Nynas has undertaken a corporate restructuring that has resulted in it no longer being blocked pursuant to the VSR.  The corporate restructuring, among other things, led to blocked persons, (i.e., PdVSA. the GOV) no longer controlling Nynas and reducing the interest of blocked persons in Nynas to below 50%.  As a result, GL 13E was revoked because US persons no longer need OFAC’s authorization to deal with Nynas.  In addition, because Nynas is now not 50%-or-more owned or controlled by PdVSA or the GOV, Nynas is also no longer subject to the non-blocking sanctions under the VSR, including Executive Order 13808 and Executive Order 13835. Given Nynas’s restructuring, OFAC also re-issued as General License 3H (“Authorizing Transactions Related to, Provision of Financing for, and Other Dealings in Certain Bonds”) and General License 9G (“Authorizing Transactions Related to Dealings in Certain Securities”) to remove references of Nynas, which, as a consequence of its corporate restructuring, are no longer relevant. Conforming changes were made to FAQs 661 and 662.

Author

Mr. Coward focuses on outbound trade compliance matters, including the extraterritorial application of US law, particularly US export control laws, anti-boycott regulations and trade sanctions/embargoes maintained by the US government against various countries. In addition, his practice covers issues of corporate conduct such as the application of the Foreign Corrupt Practices Act and foreign bribery laws. He provides international transactional advice; assistance in the design and implementation of corporate compliance programs, compliance audits, and internal investigations; and representation in enforcement proceedings.

Author

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.