Frequently Asked Questions

982. Are U.S. funds allowed to buy or sell debt or equity of blocked Russian financial institutions? Are U.S. investors allowed to invest in a fund that holds debt or equity of a blocked Russian financial institution?

982 … Unless otherwise authorized, U.S. persons may not buy or sell debt or equity of the Russian financial institutions blocked pursuant to Executive Order (E.O.) 14024 . Accordingly, a U.S. fund may not buy, sell, or otherwise engage in transactions related to debt or equity of such blocked… Read more

983. What actions did the Office of Foreign Assets Control (OFAC) take in February 2022 with respect to new debt or equity restrictions pursuant to Executive Order (E.O.) 14024?

983 … In February 2022, OFAC issued two directives under E.O. 14024 regarding restrictions related to new debt or equity involving certain Russian Federation or Russia-related entities: On February 22, 2022, OFAC issued Directive 1A under E.O. 14024, “Prohibitions Related to Certain Sovereign Debt… Read more

965. How does Directive 1A under Executive Order (E.O.) 14024, “Prohibitions Related to Certain Sovereign Debt of the Russian Federation” (Russia-related Sovereign Debt Directive) change prohibitions relating to U.S. financial institution dealings in Russian sovereign debt pursuant to Directive 1 under E.O. 14024 of April 15, 2021?

965 … Directive 1 under E.O. 14024 of April 15, 2021 imposed prohibitions on participation in the primary market for ruble or non-ruble denominated bonds issued by, or the lending of ruble or non-ruble denominated funds to, the Central Bank of the Russian Federation, the National Wealth Fund of the… Read more

985. Does the 50 Percent Rule apply to Directive 3 under Executive Order (E.O.) 14024, “Prohibitions Related to New Debt and Equity of Certain Russia-related Entities” (Russia-related Entities Directive)?

985 … Yes. The prohibitions of the Russia-related Entities Directive apply to any entity listed in Annex 1 to the Russia-related Entities Directive or otherwise determined to be subject to the prohibitions of the Russia-related Entities Directive, or their property or interests in property, which… Read more

986. What constitutes debt or equity for purposes of Directive 3 under Executive Order (E.O.) 14024, “Prohibitions Related to New Debt and Equity of Certain Russia-related Entities” (Russia-related Entities Directive)?

986 … The term “debt” includes bonds, loans, extensions of credit, loan guarantees, letters of credit, drafts, bankers acceptances, discount notes or bills, or commercial paper. The term “equity” includes stocks, share issuances, depositary receipts, or any other evidence of title or ownership… Read more

987. If a U.S. person entered into a revolving credit facility or long-term loan agreement for an entity determined to be subject to Russia-related Directive 3 under Executive Order (E.O.) 14024, “Prohibitions Related to New Debt and Equity of Certain Russia-related Entities” (Russia-related Entities Directive) prior to the relevant sanctions effective date described in the Russia-related Entities Directive, 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 14 days or less?

987 … If a U.S. person entered into a long-term credit facility or loan agreement prior to the relevant sanctions effective date described in the Russia-related Entities Directive, drawdowns and disbursements with repayment terms of 14 days or less are permitted. In addition, drawdowns and… Read more

988. Does Russia-related Directive 3 under Executive Order (E.O.) 14024, “Prohibitions Related to New Debt and Equity of Certain Russia-related Entities” (Russia-related Entities Directive) prohibit U.S. persons from engaging in all activities with entities subject to it?

988 … No. The Russia-related Entities Directive prohibits U.S. persons from engaging in only certain activities related to new debt of longer than 14 days maturity or new equity of the entities listed in Annex 1 to the Russia-related Entities Directive, or of entities otherwise determined to be… Read more

989. Does Russia-related Directive 3 under Executive Order (E.O.) 14024, “Prohibitions Related to New Debt and Equity of Certain Russia-related Entities” (Russia-related Entities Directive) prohibit U.S. persons from engaging in dealings related to debt or equity issued before the relevant sanctions effective date by entities subject to it?

989 … No, so long as the terms of such debt (including the repayment period, the interest rate, and the amount) were contractually agreed to before the relevant sanctions effective date described in the Russia-related Entities Directive and are not modified on or after the relevant sanctions… Read more

990. May a debit to an account of a person blocked pursuant to Executive Order (E.O.) 14024 be authorized as a transaction that is ordinarily incident and necessary to a licensed transaction?

990 … An authorization for transactions that are ordinarily incident and necessary to a transaction licensed pursuant to E.O. 14024 does not implicitly authorize a debit to a blocked account on the books of a U.S. financial institution. Debits to an account on the books of a U.S. financial… Read more

991. Why did the Department of the Treasury issue Afghanistan-related General License (GL) 20, “Authorizing Transactions Involving Afghanistan or Governing Institutions in Afghanistan”?

991 … The U.S. government recognizes that Afghanistan is facing a widespread humanitarian and economic crisis. Treasury issued Afghanistan-related GL 20 to ensure that U.S. sanctions do not stand in the way of transactions and activities that support basic human needs of the people in Afghanistan… Read more

Frequently Asked Questions

Office of Terrorism and Financial Intelligence