Frequently Asked Questions

373. Do the prohibitions imposed pursuant to the Directives also extend to entities owned 50 percent or more by one or more entities identified by these Directives, as per revised guidance OFAC issued on August 13, 2014?

373 … Yes, these prohibitions apply to the named persons, their property, and their interests in property, which includes entities owned 50 percent or more by one or more persons identified as subject to the Directives. On October 31, 2017, OFAC amended and reissued Directive 4 in accordance with… Read more

550. When OFAC references a prohibition involving an “SSI entity” in these FAQs or in other guidance, what does that term mean?

550 … When OFAC uses the term "SSI entity" in these FAQs or in other guidance, it is referring to an entity subject to the Directive(s) at issue in a particular FAQ or piece of guidance. … When OFAC references a prohibition involving an “SSI entity” in these FAQs or in other guidance, what does… Read more

374. If I own a Kalashnikov product, is that product blocked by sanctions? Am I able to resell a Kalashnikov product at a gun show or other secondary market?

374 … If a U.S. person is in possession of a Kalashnikov Concern product that was bought and fully paid for prior to the date of designation (i.e., no payment remains due to Kalashnikov Concern), then that product is not blocked and OFAC sanctions would not prohibit the U.S. person from keeping or… Read more

375. If I have Kalashnikov products in my inventory, can I sell them?

375 … If a U.S. person has an inventory of Kalashnikov Concern products in which Kalashnikov Concern has an interest (for example, the products are not fully paid for or are being sold on consignment), we advise that U.S. person to contact OFAC for further guidance on handling of the inventory. …… Read more

391. Can U.S. persons issue and deal in new depositary receipts that are based on the equity of an entity subject to sanctions under one of the Directives?

391 … In certain circumstances, yes. U.S. persons, including U.S. financial institutions, may issue and deal in depositary receipts that are based on equity issued by a person subject to Directive 1 prior to the date the person became subject to Directive 1. U.S. persons may not, however, deal in… Read more

392. How are banks expected to distinguish between transactions involving new versus old equity under Directive 1 if entities subject to Directive 1 issue new equity that utilizes the same International Securities Identification Number (ISIN) or other identifier as equity issued prior to the sanctions effective date?

392 … Directive 1 prohibits U.S. persons from transacting in, providing financing for, or otherwise dealing in new equity for named persons, their property, or their interests in property. Directive 1 also prohibits such transactions from occurring in the United States. If a U.S. person decides to… Read more

393. Does OFAC consider counterparty credit risk associated with derivatives transactions that are authorized pursuant to General License 1B to Executive Order 13662 to constitute new debt?

393 … OFAC does not consider normal counterparty credit exposure encountered by a U.S. person to be an extension of credit when the U.S. person enters into an otherwise permissible derivatives transaction. U.S. persons engaging in such transactions should ensure that they do not hold, purchase, or… Read more

394. If a U.S. person entered into a revolving credit facility or long-term loan arrangement for a person determined to be subject to Directives 1, 2, or 3 prior to the sanctions effective date, what are the restrictions on drawdowns from that facility? Do all drawdowns and disbursements pursuant to the parent agreement need to carry repayment terms of shorter than the applicable tenor specified in the relevant Directive?

394 … If a U.S. person entered into a long-term credit facility or loan agreement prior to the sanctions effective date, drawdowns and disbursements with repayment terms of shorter than the applicable tenor specified in the relevant Directive are permitted. In addition, drawdowns and disbursements… Read more

395. Do Directives 1, 2, and 3 prohibit U.S. persons from dealing in or processing transactions under a letter of credit that was issued on or after the sanctions effective date and that carries a term of longer than the applicable tenor specified in the relevant Directive when the beneficiary or the issuing bank of that letter of credit is one of the entities identified as subject to the Directives?

395 … U.S. persons may deal in (including act as the advising or confirming bank or as the applicant (i.e., the purchaser of the underlying goods or services)) or process transactions under a letter of credit in which an entity subject to Directive 1, 2, or 3 is the beneficiary (i.e., the exporter… Read more

396. How do I know when a name has been added, changed, or removed on the Sectoral Sanctions Identifications (SSI) List?

396 … The SSI List available on OFAC's website is the latest version of the list and contains the most updated information on entities determined to be subject to one or more of the Directives. OFAC also maintains "changes files" that record all significant changes to the SSI List. Any addition,… Read more

Frequently Asked Questions

Office of Terrorism and Financial Intelligence