Sanctions – US Sudanese Sanctions Regulations – General Licence authorising trade

Members will be aware that the US had been maintaining broad trade and financial sanctions on Sudanese goods, persons and entities including wide prohibitions on the assistance/facilitation that can be given by a US person/entity under their Sudanese Sanctions Regulations (SSR) and Executive Orders 13067 and 13412.  However, on 17 January 2017, a new general licence came into effect which now authorises all transactions that were prohibited under the SSR and Executive Orders 13067 and 13412. The further intention is that on 12 July 2017 the sanctions will be permanently revoked.

During the period of the general licence (i.e. 17 January to 12 July 2017), US persons (including financial institutions) are authorised to process transactions involving persons in Sudan (including those that remain on the SDN list under Executive Orders 13067 and 13412) and to engage in imports and exports. 

There are, however, a number of important issues that need to be taken into account before commencing Sudanese trade. These include:

1. Although transactions in US dollars will in theory be permitted, there is no indication yet from banks as to whether they will clear US dollar payments in relation to Sudan during the general licence period or await permanent revocation in July.
    
2. There is a risk that the sanctions will not be permanently revoked and instead ‘snap back’ into place in July (or before) if the Sudanese government does not continue to meet the objectives set out by the current US Govt or because a different approach is taken by the new US regime.
    
3. The current general licence is in respect of the SSR and Executive Orders 13067 and 13412 only.  It does not lift the Darfur related sanctions nor Executive Order 13400 (which lists further SDNs connected to Darfur) nor any other applicable US legislation.
    
4. EU sanctions currently remain in place, although these are not as broad as the US sanctions were, focussing mainly on a trade embargo on arms and related material (ie. military ammunition, weapons and goods) and a few targeted individuals (click here for the current EU sanctions).

For a more comprehensive general overview on these developments please click here for the views of New York lawyers, Freehill Hogan & Mahar. Members can also check OFAC’s FAQs on the SSR by clicking here as well as OFAC’s factsheet by clicking here. 

In the meantime, given the above outline of ongoing issues and related sanctions, it is strongly recommended that Members continue to undertake full due diligence and negotiate appropriate sanctions protection in all contracts if considering engaging in Sudan related trade.