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981. What does General License (GL) 9A authorize with respect to the debt and equity of certain Russian financial institutions sanctioned pursuant to Executive Order (E.O.) 14024?  What are the implications for U.S. and non-U.S. persons? 

Answer

General License (GL) 9A authorizes U.S. persons, until 12:01 a.m. eastern daylight time May 25, 2022, to engage in transactions prohibited by the Russian Harmful Foreign Activities Sanctions Regulations, 31 CFR part 587, that are ordinarily incident and necessary to dealings in debt or equity issued prior to February 24, 2022 of one or more of the following entities (“covered debt or equity”), provided that any divestment or transfer of, or facilitation of divestment or transfer of, covered debt or equity must be to a non-U.S. person:

  • State Corporation Bank for Development and Foreign Economic Affairs Vnesheconombank (VEB);
  • Public Joint Stock Company Bank Financial Corporation Otkritie; 
  • Sovcombank Open Joint Stock Company;
  • Public Joint Stock Company Sberbank of Russia;
  • VTB Bank Public Joint Stock Company;
  • Any entity owned 50 percent or more, directly or indirectly, individually or in the aggregate, by one of the above entities.

This authorization includes the facilitation, clearing, and settling of transactions ordinarily incident and necessary to divest covered debt or equity to a non-U.S. person, including on behalf of U.S. persons.  Also, as part of a divestment transaction to a non-U.S. person, U.S. persons may engage in purchases of or investment in covered debt or equity if ordinarily incident and necessary to buy to cover a short position in such holdings.

To allow the closing of trades initiated before February 24, 2022, paragraph (b) of GL 9A authorizes all transactions that are ordinarily incident and necessary to facilitating, clearing, and settling trades of covered debt or equity through 12:01 a.m. eastern daylight time May 25, 2022, provided such trades were placed prior to 4:00 p.m. eastern standard time on February 24, 2022, including debits to accounts on the books of U.S. financial institutions of certain blocked entities.  

GL 9A also authorizes U.S. persons to receive interest, dividend, or maturity payments on debt or equity of the Central Bank of the Russian Federation, the National Wealth Fund of the Russian Federation, and the Ministry of Finance of the Russian Federation through 12:01 a.m. eastern daylight time on May 25, 2022.  After May 25, 2022, U.S. persons would require a specific license to continue to receive such payments.  

Certain transactions otherwise prohibited by the Russian Harmful Foreign Activities Sanctions Regulations, 31 CFR part 587, are not authorized by GL 9A.  Please see GL 9A for additional details.  Please also see GL 10A with respect to authorizations related to certain derivative contracts. 

For purposes of assessing whether certain transactions are authorized under GL 9A or GL 10A, U.S. persons—including financial institutions, registered broker-dealers in securities, securities exchanges, and other market intermediaries and participants—may rely upon the information available to them in the ordinary course of business, including reasonable reliance on information about the underlying transaction provided by the parties thereto.  However, U.S. persons should also exercise caution in engaging in foreign exchange transactions on the Moscow Exchange given the current heightened risk that the Central Bank of the Russia Federation could be a counterparty to such transactions (see FAQ 1002). 

Date Updated: March 02, 2022

Date Released
February 24, 2022