Executive Order: Foreign Sanctions Evaders
May 2, 2012
On May 1, 2012, the U.S. Department of the Treasury (the “Treasury Department”) announced new sanctions “target[ing] foreign individuals and entities that have violated, attempted to violate, conspired to violate, or caused a violation of U.S. sanctions against Iran or Syria, or that have facilitated deceptive transactions for persons subject to U.S. sanctions concerning Syria or Iran.”1
In a crackdown against the efforts of the governments of Iran and Syria to evade U.S. sanctions, President Obama signed an Executive Order (the “Order”) titled “Prohibiting Certain Transactions with and Suspending Entry into the United States of Foreign Sanctions Evaders with Respect to Iran and Syria.” The Order grants the Treasury Department the authority to bar access to the U.S. financial and commercial systems for those foreign entities or individuals that it determines avoided or assisted in the avoidance of U.S. sanctions against Syria and Iran.
The Order authorizes the Secretary of the Treasury (the “Secretary”) to impose on a foreign person certain punitive measures once it is determined that the foreign person (i) violated, attempted or conspired to violate, or caused a violation of any sanctions in effect against Syria and Iran; (ii) facilitated deceptive transactions for or on behalf of any person subject to U.S. sanctions concerning Syria or Iran; or (iii) is owned or controlled by, or is acting or purporting to act for or on behalf of, directly or indirectly, any person described in (i) or (ii).
Upon determination that a foreign person has violated these prohibitions, the Secretary may prohibit all transactions or dealings involving such person including exporting, re-exporting, importing, selling, purchasing, transporting, swapping, brokering, approving, financing, facilitating, or guaranteeing, in or related to (i) any goods, services, or technology in or intended for the United States, or (ii) any goods, services, or technology provided by or to U.S. persons, wherever located.
In effect, once the Treasury Department has identified an entity or individual as a “foreign sanctions evader,” U.S. persons will be “prohibited from providing to, or procuring from, the sanctioned party goods, services, or technology, effectively cutting the evader off from the U.S. marketplace.”2
Finally, pursuant to the Order, foreign individuals found to be in violation of the Order will be denied entry into the U.S.
If you have any questions or concerns about U.S. sanctions against Iran, please contact one of the attorneys listed below.