OFAC Issues COSCO General License
October 24, 2019
On September 25, 2019, the U.S. Treasury Department’s Office of Foreign Assets Control (“OFAC”) added two units of Chinese shipping company COSCO to the Specially Designated Nationals (“SDN”) List. These SDN designations were made pursuant to OFAC’s Iran sanctions program and effectively barred the COSCO units from the U.S. financial system, requiring the blocking of property and interests in property in the U.S. or otherwise in the possession of a U.S. person. The designations also had secondary sanctions implications, such that non-U.S. persons were prohibited from engaging in significant transactions with the listed entities.
On October 24, 2019, OFAC announced General License K, which permits all transactions and activities that are ordinarily incident and necessary to the maintenance or wind down of transactions involving Cosco Shipping Tanker (Dalian) Co., Ltd. or any owned directly or indirectly 50 percent or more. The wind down period under General License K runs through 12:01 am EST on December 20, 2019. Notably, the general license specifically excludes transactions with Cosco Shipping Tanker (Dalian) Seaman and Ship Management Co., Ltd or any entity owned 50 percent or more by them.
If you have any questions or concerns about U.S. sanctions, please contact Bruce G. Paulsen (212-574-1533), Andrew S. Jacobson (212-574-1477), Noah S. Czarny (212-574-1642), or Paul B. Koepp (212-574-1613) at Seward & Kissel’s Sanctions Practice Group.