Co-Authored by Sharath Patil
Background on U.S. Sanctions (as of May, 2021)
The U.S. Treasury Department’s Office of Foreign Assets Control (“OFAC”) administers a number of different sanctions programs. The purpose of U.S. sanctions programs is to advance U.S. foreign policy objectives and protect national security. Currently, OFAC administers 35 sanctions programs. These sanctions programs vary widely – some are comprehensive while others are highly selective.
Co-Authored by Sharath Patil
Exporting is a Privilege, Not a Right
Over 95% of the world’s consumers are outside of the United States. Opportunities abound for U.S. companies that export. However, exporting is a privilege and not a right. U.S. exporters have an important responsibility to adhere to U.S. export control laws, including the Export Administration Regulations (“EAR”), the International Traffic in Arms Regulations (“ITAR”) the Office of Foreign Assets Control (“OFAC”) sanctions laws, and the Foreign Corrupt Practices Act (“FCPA”). Violations of export control laws carry hefty civil and criminal penalties. Exporters can pay hundreds of thousands of dollars in penalties, lose export privileges, and even be imprisoned for violations of U.S. export control laws.
Co-Authored by Sharath Patil
Cuba Designated a State Sponsor of Terror
The U.S. State Department designated Cuba a State Sponsor of Terrorism (“SST”) on January 11, 2021. Countries are designated on the SST list when they are determined by the U.S. Secretary of State to have repeatedly provided support for acts of international terrorism.
The four main categories of sanctions resulting from designation can include restrictions on U.S. foreign assistance; a ban on defense exports and sales; certain controls over exports of dual use items; and miscellaneous financial and other restrictions. Here, the January 11 re-designation of Cuba on the SST subjects Cuba to:
Co-Authored by Sharath Patil
U.S.-Cuba Trade under Trump
Since the early 1960s, the U.S. maintained a policy of economic sanctions towards Cuba. The U.S. policy sought to isolate the Cuban government. In 2014, the Obama administration significantly changed U.S. trade and economic policies towards Cuba by restoring diplomatic relations, rescinding Cuba’s designation as a state sponsor of terror, and permitting increased trade between the two countries. This period was known as the Cuban Thaw.
However, under President Trump’s administration, the Obama administration’s efforts to normalize relations have been rolled back. In November 2017, the Trump administration restricted financial transactions with entities controlled by the Cuban government. Furthermore, many new entities have been added to the Cuba restricted list under the Trump administration. As of 2019, the Trump administration has more or less abandoned engagement with the Cuban government, and has opted instead to increase sanctions based on Cuba’s human rights violations and its support of the Venezuelan government under Nicolas Maduro.
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