E.O. of September 17, 2021 provides for the imposition of menu-based sanctions on foreign persons determined by the Secretary of the Treasury, in consultation with the Secretary of State, to meet certain criteria under the order, including foreign persons determined to be responsible for or complicit in actions or policies that expand or extend the ongoing crisis in northern Ethiopia or obstruct a ceasefire or peace process. Section 1(a) of E.O. of September 17, 2021 provides the complete list of criteria for designation under the order.
Section 2(a) of E.O. of September 17, 2021 lists the menu of prohibitions that can be imposed by the Secretary of the Treasury, in consultation with the Secretary of State, on a foreign person designated under the order.
The prohibitions that may be selected include, among other things: (1) blocking sanctions on all property and interests in property of the “sanctioned person” (as defined in E.O. of September 17, 2021), except for any entities owned, in whole or in part, directly or indirectly, by one or more sanctioned persons (unless the entity is itself a sanctioned person and the blocking sanctions have been selected); (2) a prohibition on any United States person investing in or purchasing significant amounts of equity or debt instruments of the sanctioned person; (3) a prohibition on any United States financial institution making loans or providing credit to the sanctioned person; (4) a prohibition on any transactions in foreign exchange that are subject to the jurisdiction of the United States and in which the sanctioned person has any interest; and (5) any of the above sanctions on the principal executive officer or officers of the sanctioned person, or on persons performing similar functions and with similar authorities. Persons blocked pursuant to section 2(a)(i)(A) of E.O. of September 17, 2021 will appear on OFAC’s Specially Designated Nationals and Blocked Persons List (SDN List), while persons sanctioned pursuant to section 2(a)(i)(B) – (E) of E.O. of September 17, 2021 will appear on to the Non-SDN Menu-Based Sanctions List (NS-MBS List).
For the purposes of E.O. of September 17, 2021, the term “sanctioned person” means a foreign person (1) that has been determined by Secretary of the Treasury, in consultation with the Secretary of State, to meet any of the designation criteria described in section 1 of E.O. of September 17, 2021; and (2) for whom the Secretary of the Treasury, in consultation with the Secretary of State, has selected one or more of the sanctions set forth in Section 2(a) of E.O. of September 17, 2021 to impose on that foreign person. Please see Section 7(f) of E.O. of September 17, 2021.
E.O. of September 17, 2021 is designed to impose costs on actors contributing to the conflict in northern Ethiopia while mitigating potential undue harm to the people of Ethiopia, including by exempting the official business of the U.S. government by its employees, grantees, and contractors from the prohibitions under E.O. of September 17, 2021, enabling their continued support of development activity, life-saving humanitarian assistance, and longer-term assistance to address basic needs of at-risk populations.