Mr. Sanctions

Category: Regulatory

  • OFAC Amends two Russia-related FAQs

    As per the OFAC Notice:

    Issuance of Amended Russia-related Frequently Asked Questions

    Release Date

    12/18/2025

    Recent Actions Body

    OFAC is issuing two amended Russia-related Frequently Asked Questions, FAQ 1224 and 1225.

    The FAQs:

    1224. What negotiations does Russia-related General License 131A authorize, and what transaction conditions will OFAC consider when evaluating requests for further authorization to effectuate a sale of Lukoil International GmbH (LIG) assets?

    Answer

    On October 22, 2025, OFAC designated PJSC Lukoil (Lukoil) to increase pressure on Russia’s energy sector and degrade Russia’s ability to raise revenue for its war machine.  OFAC is aware of potential efforts by Lukoil to divest its assets outside of Russia to non-blocked parties, given the impact of sanctions.  To support such divestments and further cut off funding to Russia, OFAC issued Russia-related General License (GL) 131A, which authorizes negotiations and entry into contingent contracts with Lukoil for the sale of LIG or any of LIG’s majority-owned subsidiaries.  Authorized activities include negotiations on terms for definitive agreements and financial, legal, or operational due diligence, including engagement of outside counsel or advisors.  GL 131A expires on January 17, 2026.

    GL 131A does not authorize transactions to effectuate the actual sale, disposition, or transfer of any LIG entity or asset.  Any contract entered into pursuant to GL 131A must expressly be made contingent upon the receipt of a separate authorization from OFAC.  The goal of OFAC’s Russia sanctions is to place pressure on Moscow to end its war. 

    As such, Treasury would evaluate any proposed sale of LIG based on factors that support U.S. national security and foreign policy objectives.  OFAC expects that, at a minimum, the proposed transaction must:  completely sever LIG’s ties with Lukoil; block any funds owed to Lukoil until sanctions are lifted by placing them in an account subject to U.S. jurisdiction; and not provide a windfall to Lukoil, such as by providing up-front value to Lukoil, including through asset or share swaps.  Further, as a condition of any future license for effectuating a sale of LIG, OFAC expects that it will require persons purchasing LIG’s assets to seek OFAC review before further divestment of material LIG assets.

    OFAC may revoke GL 131A at any time, including if Lukoil and LIG do not appear to be engaging in good faith negotiations regarding the divestment of LIG or its assets.

    Date Updated: December 18, 2025

    Date Released

    November 19, 2025

    and:

    1225. What activities do Russia-related General License 128B and General License 131A authorize related to Lukoil International GmbH (LIG)?

    Answer

    OFAC has issued two General Licenses (GLs) relating specifically to Lukoil International GmbH (LIG) and its majority-owned subsidiaries (“LIG Entities”):  GL 128B and GL 131A.  The GLs are similar but have different expiration dates and terms as each serves a different purpose.  

    • To mitigate the effects of Lukoil’s OFAC designation on retail consumers, OFAC issued on December 4, 2025 GL 128B to authorize maintenance, operation, and wind down activities for a narrow range of LIG entities, specifically Lukoil retail automobile service stations outside of the Russian Federation.  This GL expires on April 29, 2026.
    • To enable Lukoil to divest its assets outside of Russia to non-blocked parties, OFAC issued on December 10, 2025 GL 131A to authorize, among other things, maintenance and wind down activities of all LIG Entities.  This GL has a shorter duration as it expires on January 17, 2026.  Please see Frequently Asked Question 1224 for additional information on authorizations regarding negotiations for the sale of LIG Entities.  

    GL 128B and GL 131A expressly authorize transactions undertaken in the ordinary course of business, provided that the transactions do not involve any blocked persons other than the LIG Entities described in GL 128B and GL 131A.  Transactions undertaken in the ordinary course of business may involve (but are not limited to):  supply of motor fuel and lubricants; lease payments; insurance payments; property maintenance and environmental services; employee payroll, benefits, severance, and reimbursements; information technology services; payments to government authorities; legal services and proceedings; payments to suppliers, landlords, lenders, and partners; the preservation and upkeep of pre-existing tangible property; and activities associated with maintaining pre-existing capital investments.  Also, both GL 128B and GL 131A authorize transactions ordinarily incident and necessary to performing pre-existing agreements and conducting intracompany transfers, provided that such transactions are consistent with previously established practices and support pre-existing projects or operations, consistent with the terms of the respective authorizations.  

    Both GL 128B and GL 131A also authorize financial institutions, payment processors, and other entities to use, debit, and credit the accounts of the relevant LIG Entities to effectuate the respective authorizations, but both GLs are also expressly limited by the condition that no funds may be transferred to a person or account in the Russian Federation.

    Non-U.S. persons generally do not risk exposure to U.S. sanctions under E.O. 14024 for engaging in transactions with blocked persons that are generally authorized for U.S. persons, including for those authorized by GL 128B and GL 131A.  Similarly, non-U.S. persons may rely upon GL 128B and GL 131A regardless of whether a foreign financial institution maintains blocked accounts, provided the non-U.S. person’s activities are consistent with the terms of GL 128B and GL 131A, including the requirement that no payments may be transferred to any person or account located in the Russian Federation. 

    Date Updated: December 18, 2025
     

    Date Released

    December 4, 2025

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  • December 17, 2025: OFAC Updates Two Russia-related General Licenses, and related FAQs

    From the OFAC Notice yesterday:

    The Department of the Treasury’s Office of Foreign Assets Control (OFAC) is issuing Russia-related General License 55E, “Authorizing Certain Services Related to Sakhalin-2;” and Russia-related General License 115C, “Authorizing Certain Transactions Related to Civil Nuclear Energy.”

    Additionally, OFAC is amending eight Russia-related Frequently Asked Questions: FAQs 967, 978, 999, 1011, 1117, 1182, 1203, and 1216.

    Here are the two updated GLs:

    russia_gl55eDownload

    and:

    russia_gl115cDownload

    Here’s a link to a page with all the updated FAQs (in reverse numerical order, for some reason).

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  • December 17, 2025: OFSI updates two General Licences and adds a FAQ

    OFSI General Licences INT/2025/7628424 and INT/2025/7323088 amended. FAQ 175 added.

    On 17 December 2025, OFSI General Licences INT/2025/7628424 and INT/2025/7323088were amended.

    There has been an update to the definition of “IT Providers” and an amendment to the permissions in General Licence INT/2025/7628424.

    The definition of “Legal Services” has been updated in General Licence INT/2025/7323088. See FAQ 175 for details of this amendment.

    Any persons intending to use General Licence INT/2025/7628424 and General Licence INT/2025/7323088 should consult the copy of the Licence for full details of the permissions and usage requirements.

    General Licence INT/2025/7628424:

    INT-2025-7628424Download

    General Licence INT/2025/7323088:

    20251211_INT.2025.7323088_GLDownload

    FAQ 175:

    Yes. On 17 December 2025, the Legal Services General Licence INT/2025/7323088 was amended to clarify that legal advice and/or representation in dispute resolution is included in the definition of “Legal Services”.

    This was first clarified in a version of the Legal Services General Licence issued 28 March 2025 (INT/2024/5334756). It was not captured in the subsequent issue of the expired General Licence: INT/2025/6160920 dated 28 April 2025, and although not included in the original version of the current Legal Services General Licence INT/2025/7323088 (due to expire 28 April 2026), this has now been amended.

    Added on: 17 Dec 2025

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  • UN Security Council Resolution on Al-Shabaab

    Security Council Resolution 2806:

    n2535045Download

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  • December 16, 2025: Canada adds a ship-ton of new guidance

    The Sanctions Bureau at Global Affairs Canada has released guidance related to the listing of ships under Canada’s sanctions regime.

    From their Frequently Asked Questions:

    Q: What are “Listed”, “Named” or “Designated” Ships?

    A: Some sanctions regulations prohibit certain activities in relation to certain ships, identified by their International Maritime Organization (IMO) number. In such cases, the relevant sanctions regulation will refer to “listed”, “named”, or “designated” ships. These terms are often used interchangeably when discussing sanctions, although regulations are specific in their usage of these terms.

    Q: What happens when a ship is designated?

    A: When a ship’s International Maritime Organization (IMO) number is listed under Regulations pursuant to the Special Economic Measures Act, the ship is subject to a ban on docking in Canada or passing through Canada.

    From the Listed persons, mistaken identity and delisting page:

    Listed persons or ships under the United Nations Act

    When the United Nations Security Council (UNSC) decides to impose sanctions in response to a threat to international peace and security, it is practice that a Security Council Committee is created to oversee implementation of the sanctions. Each committee publishes the names of individuals, entities or ships affected by the corresponding sanctions. They also publish the specific measures that apply to each listed name. With the exception of the Regulations Implementing the United Nations Resolutions on the Suppression of Terrorism (RIUNRST), regulations made under Canada’s United Nations Act refer to the names of listed persons (both individuals and entities) and ships published by the relevant Security Council Committee. The names of persons listed under RIUNRST are published in the Schedule to the regulations.

    See the United Nations Security Council Consolidated List available on the United Nations web site for all individuals, entities and ships subject to measures imposed by the Security Council.

    The Forms for delisting applications, requests for particulars and certificate of mistaken identity page has been updated to say:

    An individual or entity designated pursuant to either the Special Economic Measures Act (SEMA) or the Justice for Victims of Corrupt Foreign Officials Act (JVCFOA) may apply to the Minister of Foreign Affairs to have their name removed from the sanctions list. Any person that owns, operates or manages a ship listed under the SEMA may also apply to the Minister  of Foreign Affairs to have the International Maritime Organization (IMO) number of the ship removed from the sanctions list.

    To apply for the delisting of your name as a designated individual or entity, or for the delisting of a ship’s IMO number from the Consolidated Canadian Autonomous Sanctions List, complete the form below. Once submitted, Global Affairs Canada will assess the information and contact you directly if additional information is required. Processing times for any delisting application only starts the day the Sanctions Bureau receives all required documentation to complete the application, and no further information or clarification is required. Note that required information may vary based on the specific circumstances that apply. The department will contact you if additional information is required.

    Designated individuals or entities, or their representatives (such as a legal representative, private individual, corporate representative, NGO or another representative), can also request information pertaining to their designation. These requests for particulars can also be submitted using the forms below.

    Those who own, operate or manage a ship listed in regulations made under Special Economic Measures Act, or their representatives, can request information pertaining to the ship’s designation using the online form below.

    Note: Any details, including personal information, provided in an application for delisting, a request for particular or certificate of mistaken identity, may be sent to the RCMP and other agencies or departments of the Government of Canada. These details are used to verify the identity of applicants and designated individuals, entities or ships, and to assess whether a designated individual, entity or ship meets the criteria to have their name removed from the sanctions list, as well as for the administration and enforcement of the sanctions regime.

    and two forms were added:

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  • Can you be worse than terse?

    My Business Writing professor said you couldn’t, but I don’t know. I asked Gemini to produce a summarized version of the OFAC Enforcement Guidelines, and this is what I got back:

    This document acts as the “Sentencing Guidelines” for violating U.S. economic sanctions (OFAC rules). If you or your company trade with a banned country, terrorist, or sanctioned entity, this guide dictates your punishment.

    Here is the condensed version of how it works:

    1. The Spectrum of Punishment

    When you break the rules, the outcome ranges from a slap on the wrist to a major blow:

    • No Action: They drop the case.
    • Cautionary Letter: A formal warning (“Don’t do it again”).
    • Finding of Violation: A permanent mark on your record, but no money is owed.
    • Civil Monetary Penalty: You are fined cash.

    2. The “Scorecard” for Fines

    If they decide to fine you, they don’t pick a random number. They use a formula:

    • Base Fine: They start with a standard amount based on the dollar value of the illegal transaction.
    • Adjustments: They raise or lower that amount based on General Factors:
      • Fine Increases: If you did it on purpose (willful), were reckless, tried to hide it, or have a history of breaking rules.
      • Fine Decreases: If you cooperated, had a compliance program in place to stop it (but it failed), and took immediate steps to fix the error.

    3. The “Golden Rule” (Voluntary Self-Disclosure)

    This is the most critical part of the document. If you find your own mistake and tell the government about it before they catch you, your base penalty is automatically cut in half (50% off).

    The Bottom Line:

    OFAC treats honest mistakes much differently than reckless law-breaking. If you mess up: Confess early, cooperate fully, and fix the problem to minimize your penalty.

    So, I thought some important detail was missing, so I modified the prompt a few times:

    Summarize https://www.ecfr.gov/current/title-31/subtitle-B/chapter-V/part-501/appendix-Appendix%20A%20to%20Part%20501 in layperson-friendly terms. Include discussion of the penalty process, the General Factors which go into the calculation of the penalty, including any subcategories under each General Factor, and the Penalty Grid, which is based on egregiousness of the conduct and voluntary self-disclosure. Include the entire Applicable Schedule Amount table, and the current statutory maximum fines under TWEA, IEEPA, and the Kingping Act. Include a short introduction, and a short section of takeaways.

    and got back the following:

    Here is a summary of Appendix A to Part 501 of Title 31 (Economic Sanctions Enforcement Guidelines), broken down into layperson-friendly terms.

    Introduction

    This document is the official “rulebook” used by the Office of Foreign Assets Control (OFAC)—the agency that enforces U.S. sanctions (like those against Iran, Russia, or terrorist groups). It explains exactly how the government decides on the punishment when an individual or company violates these sanctions. It is designed to make penalties predictable, consistent, and transparent.

    The Penalty Process

    When OFAC suspects a violation, they follow a formal legal process. They do not simply send a bill; you have opportunities to explain yourself.

    1. Investigation: OFAC gathers evidence, often by issuing a subpoena (a legal demand for documents) or by reviewing a voluntary self-disclosure you submitted.
    2. Initial Determination: OFAC reviews the facts and chooses an outcome:
      • No Action: The case is dropped.
      • Cautionary Letter: A formal warning. No fine is issued, but you are told to fix your compliance mistakes.
      • Finding of Violation: A formal record that you broke the law, but without a monetary fine.
      • Civil Monetary Penalty: A cash fine.
    3. Pre-Penalty Notice: If they choose to fine you, they send this notice first. It explains what you did wrong and the proposed fine amount.
    4. Response: You usually have 30 days to reply. You can argue that you are innocent or admit the mistake and argue for a lower fine based on the “General Factors” (see below).
    5. Final Penalty Notice: After reading your response, OFAC issues the final fine.
    6. Settlement: At almost any stage, you can negotiate a settlement to resolve the case (usually for a lower amount) without going through the full legal fight.

    General Factors (The “Scorecard”)

    OFAC uses these factors to judge how “bad” the violation was. These are the levers that raise or lower your penalty.

    A. Willful or Reckless Violation of Law (Intent)

    • Willfulness: Did you know it was illegal and do it anyway?
    • Recklessness: Were you careless? Did you ignore red flags?
    • Concealment: Did you try to hide the evidence?
    • Pattern of Conduct: Was this a one-time accident or a habit?
    • Management Involvement: Did senior managers know?

    B. Awareness of Conduct (Knowledge)

    • Actual Knowledge: Did you know the transaction was happening?
    • Reason to Know: Should you have known? Was the info readily available?

    C. Harm to Sanctions Program Objectives (Impact)

    • Economic Benefit: Did money or goods actually reach the sanctioned target?
    • Implications for U.S. Policy: Did your action embarrass the U.S. or help an enemy?
    • License Eligibility: If you had just asked for permission first, would OFAC have said “yes”? (If so, the harm is lower).

    D. Individual Characteristics

    • Commercial Sophistication: Are you a large, global bank (held to a high standard) or a small local business?
    • Size & Financial Condition: Can you afford the fine?
    • Sanctions History: Have you been in trouble with OFAC in the last 5 years?

    E. Compliance Program

    • Did you have an internal system (software/rules) to prevent this?
    • Was that system appropriate for your company’s size?

    F. Remedial Response (Fixing It)

    • Did you stop the violation immediately?
    • Did you investigate yourself to find the root cause?
    • Did you implement new controls to ensure it never happens again?

    G. Cooperation with OFAC

    • Voluntary Self-Disclosure: Did you turn yourself in? (This is the most critical factor).
    • Responsiveness: Did you answer OFAC’s questions quickly and honestly?
    • Tolling Agreements: Did you agree to extend the statute of limitations to give OFAC more time?

    H. Timing: How long ago did this happen?

    I. Other Enforcement: Did another agency (like a banking regulator) already fine you?

    J. Future Compliance: Will a fine here serve as a good deterrent for others?

    The Penalty Grid

    OFAC calculates the “Base Penalty” using a matrix based on two questions:

    1. Was the conduct Egregious (severe/willful)?
    2. Did you Voluntarily Self-Disclose (confess)?
    ScenarioDefinitionBase Penalty Calculation
    1. Non-Egregious + DisclosedYou made a mistake and told OFAC yourself.50% of the Transaction Value (Capped at $188,850 per violation).*
    2. Non-Egregious + No DisclosureYou made a mistake, but OFAC caught you.The “Applicable Schedule Amount” (See table below).
    3. Egregious + DisclosedYou did it on purpose, but you confessed.50% of the Statutory Maximum.
    4. Egregious + No DisclosureYou did it on purpose and OFAC caught you.The Statutory Maximum.

    *Note: For very small violations in Scenario 1, the penalty is capped at much lower amounts based on the schedule.

    Applicable Schedule Amount Table

    This table is used for Non-Egregious cases (mistakes) where you did not voluntarily disclose. The fine is based on the value of the illegal transaction.

    Transaction ValueApplicable Schedule Amount (Base Penalty)
    Less than $1,000$1,000
    $1,000 to $10,000$10,000
    $10,000 to $25,000$25,000
    $25,000 to $50,000$50,000
    $50,000 to $100,000$100,000
    $100,000 to $200,000$200,000
    $200,000 or moreThe Statutory Maximum (See below)

    Current Statutory Maximum Fines (2025)

    For “Egregious” cases (or high-value non-egregious cases), the penalty is the “Statutory Maximum.” These amounts are adjusted annually for inflation. As of January 15, 2025, the maximums per violation are:

    • IEEPA (International Emergency Economic Powers Act): The greater of $377,700 or twice the value of the transaction. (This covers most sanctions programs like Iran, Russia, and Terrorism).
    • TWEA (Trading With the Enemy Act): $111,308. (Primarily covers Cuba).
    • Kingpin Act (Foreign Narcotics Kingpin Designation Act): $1,876,699.

    Takeaways

    • Honesty Saves Money: Voluntarily self-disclosing a violation automatically cuts the base penalty calculation in half.
    • Intent is Expensive: The difference between “Egregious” (reckless) and “Non-Egregious” (mistake) is massive—often the difference between a $10,000 fine and a multi-million dollar fine.
    • Compliance is a Shield: Even if you fail, having a compliance program in place lowers your penalty under the “General Factors.”
    • Cooperate: Hiding documents or delaying the investigation is considered “Concealment” and will dramatically increase your fine.

    Depending on what level of detail you need for your role, you may be able to deal with the ultra-condensed version. But it’s a cautionary tale about asking AI tools to summarize without knowing the source material and knowing what you want to see come back. And I suspect the Goldilocks result is really a combination of the two responses… but that’s just me.

    What do you think?

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  • OTSI tells you how to report sanctions violations well

    From the OFSI Blog post from yesterday:

    What does good breach reporting look like?

    Office of Trade Sanctions Implementation, 16 December 2025 – Trade Sanctions

    Why does reporting matter? 

    The Office of Trade Sanctions Implementation (OTSI) is responsible for enforcing UK trade sanctions relating to sanctioned services and the movement of sanctioned goods overseas. These sanctions are restrictive measures set by government to comply with UN obligations, promote international peace, support national security, and prevent terrorism. Sometimes, businesses or individuals may find out about a possible breach of these sanctions. When this happens, OTSI wants to hear from you.  

    If you’re a provider of financial or legal services, or a money service business, you have a legal obligation to report suspected breaches of trade sanctions. However, anybody else can voluntarily submit a report. If you think you, or someone else, may have breached trade sanctions, you can find out more information on how to report a suspected breach. 

    Any report should include the following: 

    • Contact details: Your name and email address
    • Details of the suspected breacher: The name and address of the business or person you suspect of breaching trade sanctions
    • Other parties’ details: The name and contact details (if they are known) of other people and businesses also involved in the activity
    • Supporting documents: Attach any emails, contracts, or other papers that help explain the situation. The more you can share, the better

    OTSI has already received a large number of breach reports since its launch in October 2024. Reporters use our online reporting tool in different ways. None of these are wrong or unhelpful, as most reports assist in building a picture of breaches, evasion and wider behaviour.  

    As well as reporting suspected breaches, a previous blog also highlighted the role that reporting ‘near misses’ can have in strengthening trade sanctions compliance. 

     There are important elements of breach reports that help OTSI to promote compliance with UK trade sanctions. Below, we detail what a useful breach report looks like. 

    What does a useful breach report look like? 

    OTSI investigates and carefully assesses potential trade sanctions breaches. This involves developing a complete understanding of the suspected activity. Questions we want answers to are: 

    1) When did the activity take place?  

    2) Who are the parties involved?  

    3) What specific good or service was provided? 

    We want to make reporting as easy as possible. Here are a few things that make a useful report: 

    • UK nexus: Clearly state how the activity is connected to the UK. Did it happen in the UK, or involve a UK company or UK person overseas?  
    • Clear narrative: Explain what happened in your own words. Simple, honest details are best
    • Sanctions prohibition: If you know which rule or rules may have been broken, let us know. If you aren’t sure, that’s fine too
    • Contact with other authorities: If you inform or intend to inform other public bodies, please mention this in your report
    • Supporting documents: These can be the difference between a useful report and a comprehensive report

    What not to include in a breach report 

    In general, OTSI does not require information that lacks a clear connection to the UK. However, if you are uncertain, it is better to report than not. 

    Keep things simple and clear. Use plain English. Tell us what you know. We would rather get a short report than nothing at all. 

    Remember: good reporting helps OTSI enforce trade sanctions and helps you too. The more comprehensive the initial report, the less likely it is we will need to contact you to clarify something.  

    OTSI welcomes all reports 

    OTSI values openness and honesty. If you think a trade sanctions regulation may have been breached, please submit a report to us. You don’t need to be an expert – any information helps, and more detail reduces follow-up questions. Your information could help boost the effectiveness of UK sanctions, and every report is handled carefully.  

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  • The OFAC Enforcement road less traveled

    Many of us, if not most of us, skip the part of the Federal Register that explains why the Enforcement Guidelines (the eCFR version is much easier on the eyes) came to be, and the comment period prior to its publication. Here’s a simplified version of those sections from the Federal Register version:

    1. Background

    Why was this document written?

    The Office of Foreign Assets Control (OFAC) enforces economic sanctions (punishments) against foreign countries, terrorists, and drug traffickers to protect U.S. national security.

    • The Catalyst: In 2007, the President signed a new law (the IEEPA Enhancement Act) that drastically increased the maximum fines for breaking sanctions rules. Because the potential fines became so much higher, OFAC needed to create a clear, written set of rules explaining exactly how they decide whether to fine someone and how much that fine should be.
    • The History: OFAC had tried to create these guidelines before (proposing versions in 2003 and 2006). In 2008, they published a temporary (“interim”) version of these rules. This document is the final version, incorporating feedback they received from the public and industry groups.

    2. Comments and Responses

    After publishing the temporary rules in 2008, OFAC received feedback from banks, trade groups, and lawyers. Here is a summary of what those groups asked for (“Comments”) and how OFAC answered (“Responses”).

    A. Voluntary Self-Disclosure (Confessing)

    • Comment: Industry groups wanted OFAC to clearly define what counts as “voluntarily” telling on yourself. They also wanted to know exactly how much “credit” they would get for it.
    • Response: OFAC clarified the definition. Most importantly, they confirmed that if you genuinely confess a violation before the government finds out, your base penalty will be reduced by 50%. They view this as a major incentive for honesty.

    B. Risk-Based Compliance (Internal Rules)

    • Comment: Companies asked OFAC to clarify what a “good” compliance program looks like. They were worried they would be punished for not having a perfect system, even if they were a small business.
    • Response: OFAC agreed that “one size does not fit all.” A small charity doesn’t need the same complex software as a global bank. OFAC said they will judge a company’s compliance program based on its specific size and risk profile.

    C. Cooperation

    • Comment: Commenters wanted to know if they would get credit for cooperating with an investigation even if they didn’t turn themselves in (voluntary self-disclosure).
    • Response: Yes. OFAC added a specific point stating that substantial cooperation—like quickly providing documents or signing agreements to extend deadlines—can lower your fine, even if you didn’t confess first.

    D. Determining the Fine (Penalty Calculation)

    • Comment: Many people were confused about how OFAC calculates the “value” of a transaction to set the fine (e.g., if a bank processes a $100 illegal check, is the value $100?).
    • Response: OFAC kept its method but provided more clarity. Generally, the fine is based on the dollar value of the illegal transaction. They also clarified that they distinguish between “egregious” (reckless/bad) cases and simple mistakes. Egregious cases get much higher fines.

    E. Sanctions History (Your Permanent Record)

    • Comment: Companies were worried that a mistake they made 20 years ago would count against them today.
    • Response: OFAC agreed to a limit. They stated that, generally, they will only look at your “Sanctions History” for the last 5 years. If you haven’t had a violation in 5 years, a new mistake is treated as a “first offense” (which gets a lower penalty).

    F. Foreign Laws and Secrecy

    • Comment: Global companies pointed out that some foreign countries have laws that make it illegal to share customer data with the U.S. government. They feared being fined by OFAC for failing to provide information that was legally blocked abroad.
    • Response: OFAC said they will consider this on a case-by-case basis. However, they expect companies to try their hardest to get the information to OFAC legally. You can’t just use foreign laws as an easy excuse to hide information.

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  • Burning Question: Could President Trump undo all the OFAC Russian sanctions?

    The prompt:

    if President Trump revoked all the Executive Orders for all of the Russia-related sanctions programs (including Russia Harmful Foreign Activities, Ukraine/Russia-related sanctions and Magnitsky sanctions), what would be left of them due to any legislation passed by Congress, if anything?

    The result from Gemini:

    If President Trump were to revoke all Executive Orders (EOs) related to Russia, Ukraine, and Human Rights (Magnitsky), a significant portion of the sanctions regime would remain in force.

    This is because Congress has aggressively “codified” (written into permanent law) many of these sanctions over the last decade to prevent exactly this scenario. The President cannot overturn a statute with an Executive Order.

    Here is a breakdown of what would legally remain standing:

    1. The “2014-Era” Sanctions (Codified by CAATSA)

    The most durable layer of sanctions comes from the Countering America’s Adversaries Through Sanctions Act (CAATSA) of 2017.

    • What stays: CAATSA Section 222 explicitly codified the Obama-era Executive Orders related to the invasion of Crimea (EOs 13660, 13661, 13662, and 13685).1
    • The Result: Even if the President signs a paper revoking these EOs, the sanctions exist as federal law. The “Sectoral Sanctions” (restrictions on Russian energy and banking debt/equity) and the blocking of major oligarchs designated under these authorities would remain legal obligations.
    • The Lock: To remove these, the President must prove to Congress that Russia has met specific hardline criteria (e.g., implementing the Minsk agreements), which is currently politically impossible.

    2. The Magnitsky Act (Human Rights)

    The prompt mentions “Magnitsky sanctions.” It is crucial to distinguish between the two types, as one is much harder to kill.

    • The Sergei Magnitsky Rule of Law Accountability Act of 2012: This is a statute, not an EO. It targets Russians involved in the death of Sergei Magnitsky and other gross human rights violations.2 The President cannot revoke this program. He must enforce it by law.
    • The Global Magnitsky Act (GloMag): This is also a statute, though it is implemented via EO 13818.3 If the President revoked EO 13818, the mechanism for enforcing GloMag would pause, but the underlying law requiring the President to impose sanctions on human rights abusers would remain, creating a legal conflict until a new mechanism was created.

    3. The Sovereign Assets Freeze (REPO Act)

    Passed in April 2024 (as part of the foreign aid package), the REPO for Ukrainians Act creates a statutory lock on the frozen assets of the Russian Central Bank.

    • What stays: The Act explicitly prohibits the President from unblocking Russian sovereign assets (worth billions) until Russia withdraws from Ukraine and pays compensation.
    • The Result: Even if the President revokes EO 14024 (which originally blocked the Central Bank), the REPO Act overrides that revocation. The money stays frozen by statute.

    4. Trade and Energy Bans (2022 Laws)

    Congress passed two specific laws in 2022 that operate independently of Executive Orders:

    • The Oil Ban: The Ending Importation of Russian Oil Act makes it illegal to import Russian energy products (oil, gas, coal) into the U.S. A President cannot waive this without a new law.
    • The Tariff Hike: The Suspending Normal Trade Relations with Russia and Belarus Act stripped Russia of “Most Favored Nation” trade status. This keeps tariffs on Russian goods incredibly high.

    5. Chemical Weapons Sanctions (CBW Act)

    Because the U.S. formally determined Russia used chemical weapons (Navalny/Skripal cases), the Chemical and Biological Weapons Control and Warfare Elimination Act of 1991 mandates specific sanctions.

    • What stays: Restrictions on arms sales, bank loans, and technology exports.
    • The Lock: These can only be removed if the President certifies to Congress that Russia has admitted inspectors and renounced chemical weapons.

    6. The “Gap”: What Would Actually Disappear?

    While the “floor” provided by Congress is high, revoking the EOs would still break the “ceiling” of the current maximum-pressure campaign.

    • The “New” Designations: While the REPO Act freezes the Central Bank, thousands of individual Russian elites, smaller banks, and defense companies were designated solely under EO 14024 (the 2021 “Harmful Foreign Activities” order). Because EO 14024 was issued after CAATSA (2017), it was not codified by that specific law.
    • Secondary Sanctions: The threat of secondary sanctions on foreign banks (China, Turkey, UAE) for aiding Russia’s military-industrial base relies heavily on recent amendments to EO 14024.4 Revoking the EO would eliminate this specific tool.

    Summary: The Congressional Veto

    Finally, CAATSA Section 216 acts as a safety valve for all of the above. It created a “Congressional Review” process.

    • If the President tries to “terminate” or “waive” sanctions on Russia, he must notify Congress.
    • Congress has 30 days to pass a Joint Resolution of Disapproval.
    • If passed (and capable of overriding a veto), this Resolution legally stops the President from removing the sanctions.

    Bottom Line: If the Executive Orders were revoked, the energy ban, tariffs, central bank asset freeze, and 2014-era sanctions would legally remain. The primary loss would be the specific blocking of individuals and companies designated only under the post-2021 authorities (EO 14024), though Congress would likely move to block that revocation immediately.

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  • Daily Digest for Thursday, December 4, 2025

    Daily Digests are simple lists of hyperlinks to new content released by sanctions and export control regulators. When appropriate, additional posts of analysis and commentary, as well as summarizations and rephrasing of the contents will be posted separately.

    Mr. Sanctions does not attempt to comprehensively cover the worlds of sanctions and export control. Opinions expressed here are my own and do not represent that of my past current or future employers.

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