On July 31, 2020, OFAC designated, pursuant to E.O. 13818, the Xinjiang Production and Construction Corps (XPCC) for its connection to serious human rights abuse in the Xinjiang Uyghur Autonomous Region (XUAR). Concurrent with this action, OFAC issued Global Magnitsky General License (GL) 2. GL 2 was replaced and superseded by Global Magnitksy General License 2A on September 25, 2020. GL 2A does not authorize any transactions involving the XPCC itself; however, GL 2A does authorize, subject to certain conditions, U.S. persons to engage in transactions and activities prohibited by the Global Magnitsky Sanctions Regulations (GSMR) that are ordinarily incident and necessary to the wind down of transactions involving any entity in which the XPCC owns, directly or indirectly, a 50 percent or greater interest (Blocked XPCC Subsidiary), through 12:01 a.m. eastern standard time, November 30, 2020.
GL 2A also authorizes, subject to certain conditions, transactions and activities that are ordinarily incident and necessary to (1) divest or transfer debt, equity, or other holdings of any Blocked XPCC Subsidiary to a non-U.S. person, or (2) facilitate the transfer of debt, equity, or other holdings in any Blocked XPCC Subsidiary by a non-U.S. person to another non-U.S. person, through 12:01 a.m. eastern standard time, November 30, 2020. GL 2 does not authorize divestment activities involving the XPCC itself, nor does it authorize U.S. persons to sell to, purchase or invest in, or facilitate such transactions with any blocked person — including Blocked XPCC Subsidiaries, except for such purchases of or investments in Blocked XPCC Subsidiaries that are ordinarily incident and necessary to effectuate authorized divestment transactions. Further, GL 2A does not authorize any debit to the account of any Blocked XPCC Subsidiary on the books of a U.S. financial institution.
After the expiration of this general authorization, U.S. persons will be prohibited from engaging in or facilitating transactions with Blocked XPCC Subsidiaries unless exempt or authorized by OFAC. U.S. persons unable to wind down transactions with, or divest from, any Blocked XPCC Subsidiary before 12:01 a.m. eastern standard time, November 30, 2020, are encouraged to seek guidance from OFAC.
Non-U.S. persons may wind down transactions with, or divest from, a Blocked XPCC Subsidiary without exposure to sanctions under E.O. 13818, provided that such wind-down activity is consistent with GL 2A. Wind-down transactions involving non-U.S. persons may be processed through the U.S. financial system or involve U.S. persons as long as the transactions comply with the terms and conditions in GL 2A. Non-U.S. persons unable to wind down transactions with, or divest from, a Blocked XPCC Subsidiary before 12:01 a.m. eastern standard time, November 30, 2020, are encouraged to seek guidance from OFAC.
The unblocking of any property blocked pursuant to any other part of 31 C.F.R. chapter V is not authorized under GL 2A.