The changes made by the United States to its sanctions against Iran on Implementation Day resulted in the lifting of most of the secondary sanctions imposed on non-US parties engaging in transactions with Iran or designated parties associated with Iran. Implementation Day also yielded a general license that authorizes transactions by non-US subsidiaries of US persons involving Iran and the Government of Iran, subject to certain conditions. This all bodes well for European based companies that wish to engage in transactions involving Iran.
By Susan Kovarovics, 9 June 2016.
However, caution must still be exercised to ensure NO involvement by US persons in those transactions. Although it may not be a violation for your company, it can still have an impact on your business because of disruption to the day-to-day business activities.
What is prohibited facilitation under the US sanctions? Prohibited facilitation is when a US person helps in any way a transaction by a non-US person that the U.S. person could not legally engage in herself. Facilitation is construed by the Office of Foreign Assets Control (OFAC) to include assisting a transaction in any way, including by approving it, financing it, or guaranteeing it. In addition, US sanctions consider a referral by a US person of a transaction in which the US person could not engage due to sanctions to also be prohibited facilitation.
To the extent that your company employs US person individuals, including US citizens and permanent residents, anywhere outside the United States, it is important to keep in mind that those individuals will need to continue individually complying with the US sanctions against Iran. Those individuals cannot participate in any ongoing business the company may undertake involving Iran. Irrespective of whether your company is a non-US subsidiary of a US company or a “wholly” non-US entity, there is no authorization under US sanctions for activities by US person individuals working outside the United States to engage in business or other transactions involving Iran. If a US person employee of your company is involved in such a transaction, OFAC could pursue an enforcement action against the individual for violations of US sanctions.
As a result, it is prudent to determine in what roles your company employs US person individuals and assess the likelihood that they may be called upon to participate in transactions involving Iran if your company is engaging in business there. Consider providing training to those individuals to help them spot compliance concerns for their activities, and for those working with them to raise awareness about general do’s and don’ts.
Ms. Kovarovics designs and implements compliance programs and provides training sessions on export and defense trade controls, trade sanctions, customs, anti-corruption and anti-boycott matters. She also designs and leads internal audits and reviews to assess compliance in these areas.
Ms. Kovarovics assists clients with all aspects of the export license and agreement approvals processes at the Department of Commerce, State and Treasury. In addition, she guides clients through commodity jurisdictions and commodity classification requests for exports and ruling requests related to import matters. She also conducts due diligence reviews related to export controls, trade sanctions and anti-corruption matters.
Routinely, Ms. Kovarovics conducts internal investigations and advises clients on future actions based on results of investigations, including appropriate disciplinary and other corrective measures in response to violations of corporate policies and trade regulations. Moreover, she counsels clients on voluntary disclosure matters and represents clients in enforcement proceedings before federal authorities.
Susan’s Bar Admissions include the states of Virginia and the District of Columbia in the U.S.
Education: Susan earned her law degree from Georgetown University, cum laude (1996) and her undergraduate degree from Drew University, summa cum laude (1993).
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