Global Magnitsky Sanctions

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  GL 2 was replaced and superseded by Global Magnitksy General License 2A on September 25, 2020.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. 

Pursuant to Global Magnitsky General License (GL) 3, U.S. persons are authorized to engage in certain transactions that would otherwise be prohibited by the Global Magnitsky Sanctions Regulations, 31 CFR part 583, ordinarily incident and necessary to the divestment or transfer, or facilitation of the divestment or transfer, of debt or equity of PME to a non-U.S. person through 12:01 a.m. eastern standard time, March 9, 2023.  

GL 3 also authorizes transactions ordinarily incident and necessary to facilitating, clearing, and settling trades of debt or equity of PME that were placed prior to 4:00 p.m. eastern standard time, December 9, 2022, through 12:01 a.m. eastern standard time, March 9, 2023.  

GL 3 also authorizes, through 12:01 a.m. eastern standard time, March 9, 2023, transactions ordinarily incident and necessary to the wind down of financial contracts or other agreements linked to the debt or equity of PME and entered into prior to 4:00 p.m. eastern standard time, December 9, 2022, provided that any payments to a blocked person are made into a blocked account in accordance with OFAC sanctions regulations.  This authorization includes transactions ordinarily incident and necessary to the delisting of PME from a U.S. securities exchange. 

However, GL 3 does not authorize U.S. persons to sell or facilitate the sale of debt or equity of PME to, directly or indirectly, any person whose property and interests in property are blocked, including Xinrong Zhuo, who was designated on the same day and is PME’s chairman and CEO, among other things.  U.S. persons unable to wind down transactions in accordance with GL 3 before 12:01 a.m. eastern standard time, March 9, 2023, are encouraged to seek guidance from OFAC before that date.  Please see GL 3 for further details.  

On December 9, 2022, OFAC designated, pursuant to Executive Order (E.O.) 13818, several persons, including Dalian Ocean Fishing Co., Ltd.; Fujian Provincial Pingtan County Ocean Fishing Group Co., Ltd.; Fuzhou Honglong Ocean Fishing Co. Ltd.; and Pingtan Marine Enterprise Ltd. Concurrent with this action, OFAC issued Global Magnitsky General License (GL) 4, which authorizes all transactions ordinarily incident and necessary to the wind down of any transaction involving any vessel in which any of these blocked entities have an interest that would otherwise be prohibited by the Global Magnitsky Sanctions Regulations, 31 CFR part 583, through 12:01 a.m. eastern standard time, March 9, 2023, provided that any payment to a blocked person must be made into a blocked account in accordance with OFAC sanctions regulations.

The wind-down authorization in GL 4 contemplates, for example, completion of ongoing voyages, including the discharge of cargo aboard such vessels to non-blocked persons; docking or anchoring of the vessels at third-country, non-sanctioned ports; transactions related to the safety and maintenance of such vessels, such as entering into certain contracts to pay for insurance coverage, flagging, and safety and compliance inspections during the wind-down period; and transactions related to the health and safety of any crew, including the provision and processing of wages or other employee benefits, or other provision of crewing services.

After the expiration of this authorization, persons will be prohibited from engaging in such wind-down transactions with the blocked persons or vessels, unless exempt or otherwise authorized by OFAC.  Persons unable to wind down transactions with the blocked persons or vessels specified in GL 4 before 12:01 a.m. eastern standard time, March 9, 2023, are encouraged to seek guidance from OFAC before that date.  Please see GL 4 for further details.  

No.  Non-U.S. persons may engage in the transactions authorized for U.S. persons by Global Magnitsky General License (GL) 3 and wind down transactions with the blocked persons specified in GL 4, without exposure to sanctions under Executive Order (E.O.) 13818 or the Global Magnitsky Sanctions Regulations, 31 CFR part 583, provided that such activity is consistent with those GLs.  Further, such 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 GLs 3 and 4.  Non-U.S. persons unable to wind down transactions in accordance with GLs 3 and 4 before 12:01 a.m. eastern standard time, March 9, 2023, are encouraged to seek guidance from OFAC before that date.

On January 26, 2023, OFAC designated Frigorifico Chajha S.A.E. (Frigorifico Chajha), pursuant to E.O. 13818.  Concurrent with this action, OFAC issued General License (GL) 5 , which authorizes certain transactions ordinarily incident and necessary to the divestment or transfer, or the facilitation of the divestment or transfer, of debt or equity of Frigorifico Chajha to a non-U.S. person, through 12:01 a.m. eastern daylight time, March 27, 2023.  

GL 5 also authorizes certain transactions ordinarily incident and necessary to facilitating, clearing, and settling trades of debt or equity of Frigorifico Chajha that were placed prior to 4:00 p.m. eastern standard time, January 26, 2023, through 12:01 a.m. eastern daylight time, March 27, 2023.  

GL 5 also authorizes certain transactions that are ordinarily incident and necessary to the wind down of derivative contracts entered into prior to 4:00 p.m. eastern standard time, January 26, 2023, that (1) include Frigorifico Chajha as a counterparty, or (2) are linked to the debt or equity of Frigorifico Chajha, through 12:01 a.m. eastern daylight time, March 27, 2023, provided that any payments to a blocked person are made into a blocked account in accordance with the Global Magnitsky Sanctions Regulations, 31 CFR part 583.  

However, GL 5 does not authorize U.S. persons to sell, or to facilitate the sale of, debt or equity of Frigorifico Chajha to, directly or indirectly, any person whose property and interests in property are blocked.  GL 5 also does not authorize U.S. persons to purchase or invest in, or to facilitate the purchase of or investment in, directly or indirectly, debt or equity of Frigorifico Chajha, other than purchases of or investments in debt or equity of Frigorifico Chajha that are ordinarily incident and necessary to the divestment or transfer of debt or equity of Frigorifico Chajha as described in GL 5.

Non-U.S. persons generally do not risk exposure to U.S. sanctions for engaging in activities that would be exempt or authorized for U.S. persons pursuant to GL 5. 

On January 26, 2023, OFAC designated, pursuant to E.O. 13818, Horacio Manuel Cartes Jara (Cartes) for his involvement in corruption in Paraguay.  Also on that day, OFAC designated four entities owned or controlled by Cartes, pursuant to E.O. 13818:  Tabacos USA Inc., Bebidas USA Inc., Dominicana Acquisition S.A., and Frigorifico Chajha S.A.E. (collectively, “designated Cartes entities”).  Concurrent with this action, OFAC issued Global Magnitsky General License (GL) 6 , which authorizes, subject to certain conditions, transactions prohibited by the Global Magnitsky Sanctions Regulations, 31 CFR part 583 (GMSR), that are ordinarily incident and necessary to the wind down of any transaction involving any of the designated Cartes entities, or any entity in which Cartes or the designated Cartes entities own, directly or indirectly, a 50 percent or greater interest (collectively, “blocked Cartes entities”), through 12:01 a.m. eastern daylight time, March 27, 2023, provided that any payment to a blocked person must be made into a blocked account in accordance with the GMSR.  GL 6 does not authorize any transactions involving Cartes himself.

After the expiration of this general authorization, U.S. persons will be prohibited from engaging in such wind-down transactions with blocked Cartes entities, unless exempt or otherwise authorized by OFAC.  U.S. persons unable to wind down transactions with blocked Cartes entities before 12:01 a.m. eastern daylight time, March 27, 2023, are encouraged to seek guidance from OFAC.

Non-U.S. persons may wind down transactions with blocked Cartes entities without exposure to sanctions under E.O. 13818, provided that such wind-down activity is consistent with GL 6.  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 6.  Non-U.S. persons unable to wind down transactions with blocked Cartes entities before 12:01 a.m. eastern daylight time, March 27, 2023, are encouraged to seek guidance from OFAC.

Global Magnitsky General License 7 authorizes certain transactions involving the blocked entities Tabacos USA Inc. (Tabacos) and Tabacalera del Este S.A. (Tabesa) (or any entity in which Tabesa or Tabacos owns, directly or indirectly, individually or in the aggregate, a 50 percent or greater interest) that are ordinarily incident and necessary to payments under the Master Settlement Agreement (MSA) entered into on November 23, 1998 between certain U.S. state and territory attorneys general and certain tobacco companies.  On January 26, 2023, OFAC designated former Paraguayan president Horacio Manuel Cartes Jara (Cartes) pursuant to Executive Order 13818 for involvement in corruption and also designated Tabacos for being owned or controlled by Cartes.  On March 31, 2023, OFAC identified Tabesa as an entity that is owned, directly or indirectly, 50 percent or more by Cartes and added Tabesa to the SDN List.  

Global Magnitsky General License 7 does not authorize debits to any blocked account on the books of a U.S. financial institution or any other transactions otherwise prohibited by the Global Magnitsky Sanctions Regulations.

Generally, the designation of an individual with a leadership role in a governing institution does not itself block the governing institution.  Accordingly, engaging in a routine interaction with a governing institution in which a blocked individual is an official, but that does not directly or indirectly involve the blocked individual in question, is not prohibited.  This applies to any designated individual in Afghanistan who has a leadership role in a governing institution in Afghanistan, including any individual blocked pursuant to the Global Magnitsky Sanctions Regulations (GMSR).  For example, making a customs payment to a governing institution in Afghanistan led by a blocked individual would not be prohibited by the GMSR.  However, engaging directly or indirectly with that blocked individual, such as receiving an invoice bearing the blocked individual’s signature for a commercial transaction, would be prohibited by the GMSR unless authorized by OFAC or exempt.

In addition, certain humanitarian-related transactions involving individuals blocked pursuant to the GMSR may be authorized by general licenses (GL) in the GMSR related to certain international organizations (IOs), nongovernmental organizations (NGOs), official business of the United States government (USG), or agricultural commodities, medicine, medical devices, replacement parts and components, or software updates for personal, non-commercial use (Ag-Med).  For more information on these GLs, please consult OFAC ‘s Supplemental Guidance for the Provision of Humanitarian Assistance and FAQs 1105, 1106, 1107, 1108.

For information on transactions involving governing institutions in Afghanistan led by an individual or entity designated under the Global Terrorism Sanctions Regulations, the Foreign Terrorist Organizations Sanctions Regulations, or Executive Order 13224, please consult Afghanistan-related GL 20 and FAQ 993.

If individuals or entities, including IOs, NGOs, or financial institutions, have questions about engaging in or processing transactions related to these authorizations, they can contact the OFAC Compliance Hotline via email at OFAC_Feedback@treasury.gov.

Yes. Although transactions or other dealings involving Ly and L.Y.P. Group are prohibited as a result of OFAC's designation, OFAC concurrently issued Global Magnitsky General License (GL) 8 authorizing U.S. persons to engage in all transactions with any entity owned 50% or more by Ly or the L.Y.P. Group that is not listed on SDN List.

Non-U.S. persons may engage in the transactions authorized by GL 8 without exposure to sanctions.

GL 8 does not authorize transactions with any entity listed on the SDN List, including the following entities that were designated on September 12, 2024: O-Smach Resort, Garden City Hotel, Koh Kong Resort, and Phnom Penh Hotel. OFAC will continue to closely monitor Ly's and L.Y.P. Group's activities and may designate or identify additional entities, as appropriate.