The U.S. Treasury’s Office of Foreign Assets Control (OFAC) has issued final regulations (83 Fed. Reg. 30541, 31 CFR part 583) to implement the Global Magnitsky Human Rights Accountability Act (Pub. L. 114-328, Title XII, Subtitle F) and Executive Order 13818.
In late 2016, President Obama signed the Global Magnitsky Act, which authorizes the president to impose targeted sanctions on any foreign person determine to be responsible for extrajudicial killings, torture, or other gross violations of human rights. Sanction may also be imposed on any government official responsible for, or complicit in, ordering, controlling, or otherwise directing acts of significant corruption. In December 2017, President Trump signed the Executive Order to implement the Global Magnitsky Act and address serious human rights abuse and corruption around the world. The Order declares a national emergency with respect to serious human rights abuse and corruption and provides for the imposition of sanctions on actors engaged in these activities. In an Annex to the Order, the president imposed sanctions on 13 individuals. The order blocks their property within the United States, as well as any transactions with them, and bars their entry into the U.S. At the same time, OFAC imposed sanctions on an additional 39 affiliated individuals and entities under the Executive Order.
The new regulations were issued in abbreviated form “for the purpose of providing immediate guidance to the public.” OFAC intends to supplement this with a more comprehensive set of regulations that may include guidance, general licenses, and statements of licensing policy. The regulations were issued without proposed rulemaking, opportunity for public comment and delay in effective date, because they involve a foreign affairs function, according to the notice, making these provisions of administrative law inapplicable.
The regulations prohibit all transactions with persons listed pursuant to the Executive Order and makes all transactions with them mull and void. Exceptions to this will be made by way of licenses issued by OFAC. An exception is also granted when the transfer did not represent a willful violation of the regulations, the person conducting the transfer did not have reasonable cause to know or suspect that the transfer required a license, and the person conducting the transfer filed a report with OFAC setting forth the circumstances relating to the transfer as soon as the violation was discovered. There are also exemptions in the regulations for personal communications, information or informational materials, and software/technology.