United States: latest updates on sanctions

We report below on the most significant new developments in US sanctions, including a document released by the Bureau of Industry and Security on the tools available to authorities to monitor compliance with sanctions and export control regulations, the most recent listings, aimed in particular at dismantling Russia sanctions evasion networks in third countries, and an OFAC guide aimed at shipping operators.

BIS’ new guide on export controls

The Bureau of Industry and Security (BIS) of the US Department of Commerce has released a document in which it provides a broad overview of the tools available to US authorities to monitor compliance with export control and sanctions regulations, and to punish violations. In addition, the document lists and describes more than one hundred cases of individuals who have been investigated, convicted or also sanctioned for violating one or more of the restrictive measures administered by the BIS.

The export of many controlled items, such as software and technology, requires a licence from BIS. It is up to the exporter to obtain a licence when required by the EAR (Export Authorisation Regulations). Licence requirements depend on various factors, including the technical characteristics of the product, the destination, the end user and the intended use. To assess whether a transaction requires a licence, the following questions must be considered:

• What is being exported?
• Where is the item being exported?
• Who will receive the item?
• How will the item be used?

Remedies and sanctions for violations

The remedies available to the BIS to respond to violations of the programmes it administers are:

• Administrative and or criminal fines: in the case of wilful violations of the EAR (Export Authorisation Regulations), there are both criminal sanctions, up to USD 1 million and 20 years in prison, and administrative sanctions, which are also applicable without wilful intent. The BIS can impose administrative penalties of up to $364,992 or double the value of the transaction, revoke export privileges and place violators on restriction lists.
• Denial and revocation of export privileges: BIS may revoke export privileges of individuals or companies, domestic or foreign, preventing them from exporting or receiving items subject to the EAR. This sanction, applicable in both administrative and criminal cases, also prohibits others from conducting export transactions with the sanctioned party.