General License 3I (GL 3I) authorizes U.S. persons to engage in all transactions related to, the provision of financing for, and other dealings in the bonds specified in the Annex to GL 3I (GL 3I Bonds) that would be prohibited by subsection 1(a)(iii) of Executive Order (E.O.) 13808 or by E.O. 13850, each as amended by E.O. 13857, or by E.O. 13884, as collectively incorporated into the Venezuela Sanctions Regulations, 31 CFR part 591 (the VSR).  The authorization in GL 3I includes, for example, engaging in transactions related to the receipt and processing of interest or principal payments, and acting as a custodian for U.S. and non-U.S. persons’ holdings in GL 3I Bonds.  GL 3I also authorizes divestment of the GL 3I Bonds, including, on or after October 18, 2023, to other U.S. persons.

Paragraph (b) of GL 3I authorizes all transactions prohibited by subsection 1(a)(iii) of E.O. 13808 or by E.O. 13850, each as amended by E.O. 13857, or by E.O. 13884, that are ordinarily incident and necessary to facilitating, clearing, and settling trades of holdings in the GL 3I Bonds, provided such trades were placed prior to 4:00 p.m. eastern standard time on February 1, 2019; this authorization aims to ensure that trades that were placed prior to February 1, 2019, are allowed to settle in the ordinary course.

Paragraph (d) of GL 3I authorizes all transactions related to, the provision of financing for, and other dealings in bonds that were issued both (i) prior to August 25, 2017 (the effective date of E.O. 13808), and (ii) by U.S. person entities owned or controlled, directly or indirectly, by the Government of Venezuela, other than PDV Holding, Inc., CITGO Holding, Inc., and any of their subsidiaries, that would be prohibited by E.O. 13808 or E.O. 13850, each as amended, or by E.O. 13884.

Date Updated: October 18, 2023

General License (GL) 9H authorizes U.S. persons to engage in all transactions prohibited by subsection 1(a)(iii) of Executive Order (E.O.) 13808 or by E.O. 13850, each as amended by E.O. 13857, or by E.O. 13884, as collectively incorporated into the Venezuela Sanctions Regulations, 31 CFR part 591 (the VSR), that are ordinarily incident and necessary to dealings in any debt of, or equity in, PdVSA, or any entity directly or indirectly owned 50 percent or more by PdVSA, that was issued prior to August 25, 2017 (together, “PdVSA Securities”).  This includes bonds issued by PDV Holding, Inc. and CITGO Holding, Inc., or any of their subsidiaries.  The authorization in GL 9H includes, for example, engaging in transactions related to the receipt and processing of interest or principal payments, and acting as a custodian for U.S. and non-U.S. persons’ holdings in PdVSA Securities.  GL 9H also authorizes divestment of the PdVSA Securities, including, on or after October 18, 2023, to other U.S. persons.

Paragraph (c) of GL 9H authorizes all transactions prohibited by subsection 1(a)(iii) of E.O. 13808 or by E.O. 13850, each as amended by E.O. 13857, or by E.O. 13884, that are ordinarily incident and necessary to facilitating, clearing, and settling trades of holdings in PdVSA Securities, provided such trades were placed prior to 4:00 p.m. eastern standard time on January 28, 2019; this authorization aims to ensure that trades that were placed prior to the imposition of blocking sanctions on PdVSA are allowed to settle in the ordinary course. 

Date Updated: October 18, 2023

The President issued Executive Order (E.O.) 13835 on May 21, 2018. Subsection 1(a)(iii) of E.O. 13835 prohibits U.S. persons from engaging in transactions related to the sale, transfer, assignment, or pledging as collateral by the Government of Venezuela (GOV) of any equity interest in an entity owned 50 percent or more by the GOV. One effect of subsection 1(a)(iii) is to require authorization before U.S. persons may engage in certain transactions regarding any equity interest in an entity owned 50 percent or more by the GOV. Subsequent to the issuance of E.O. 13835, OFAC received inquiries about how and whether subsection 1(a)(iii) of E.O. 13835 could affect the ability to enforce bondholder rights to the CITGO shares serving as collateral for the Petróleos de Venezuela, S.A. (PdVSA) 2020 8.5 percent bond. OFAC issued General License (GL) 5 on July 19, 2018, which removed E.O. 13835 as an obstacle to holders of the PdVSA 2020 8.5 percent bond gaining access to their collateral.

General License 5 was replaced and superseded by General License 5A on October 24, 2019 with a delay in the effectiveness of the authorization in the general license. Since that date, OFAC has extended the delay in effectiveness several times. Most recently, OFAC issued General License 5M on October 18, 2023, which further delays the effectiveness of the authorization in GL 5 until January 18, 2024. Between October 24, 2019 and January 18, 2024 (the date the authorization in General License 5M becomes effective), there is no authorization in effect that licenses against subsection 1(a)(iii) of E.O. 13835 applicable to the holders of the PdVSA 2020 8.5 percent bond. As a result, during such period, transactions related to the sale or transfer of CITGO shares in connection with the PdVSA 2020 8.5 percent bond are prohibited, unless specifically authorized by OFAC.

To the extent an agreement may be reached on proposals to restructure or refinance payments due to the holders of the PdVSA 2020 8.5 percent bond, additional licensing requirements may apply. OFAC would encourage parties to apply for a specific license and would have a favorable licensing policy toward such an agreement.

Date Updated: October 18, 2023