So Long Sudan Sanctions: The Final Wrap
On January 13, 2017, we announced that the Obama Administration had issued a general license allowing most transactions between US persons and the country of Sudan (aka North Sudan), although exports and reexports of items on the Commerce Control List continued to require a license from the Department of Commerce’s Bureau of Industry and Security, unless there was an applicable license exception (of limited availability for Sudan).
Although this General License has continued in place since then, the underlying Executive Orders remained in place, thereby allowing a speedy reimposition of sanctions, should the Trump Administration decide to do so.[1] When we last we posted in July, President Trump had just decided to postpone his decision until October 2017.
On October 6, 2017, the US Government announced that it will revoke certain sanctions with respect to Sudan, pursuant to Executive Order 13761, as amended by EO 13804, effective October 12, 2017. The State Department report found that the Government of Sudan had sustained the positive developments in its conduct. The announcement and action represent the lifting of the comprehensive embargo on Sudan, although some restrictions and limitations remain.
As a result of the prohibitions in sections 1 and 2 of EO 13067 and EO 13412 being revoked, US persons are no longer be subject to the prohibitions of the Sudanese Sanctions Regulations, 31 C.F.R. 538, although this section of the OFAC regulations has not yet been removed from volume 31 of the Code of Federal Regulations. On October 12, OFAC removed a long list of SDNs which were only designated under the [SUDAN] designation.
Despite the broad opening to engage Sudan, US persons and non-US persons are still required, as applicable, to obtain licenses from BIS to export or reexport certain items (i.e., commodities, software, and technology) that appear on the CCL, as well as for transactions involving EAR99 items that do not appear on the CCL, if they will be used for restricted end uses such as certain nuclear, missile/rocket, and chemical and biological weapon end uses, or are for restricted end-users.
In addition, US persons taking advantage of the lifting of the Sudanese embargo must bear in mind that the revocation of prohibitions under the SSR and EOs 13067 and 13412 has no impact on other Sudan-related sanctions programs, namely the Darfur Sanctions Regulations, 31 C.F.R. part 546 and South Sudan Sanctions Regulations, 31 C.F.R. 558.
Moreover, numerous Sudanese entities and individuals remain blocked under EOs not impacted by the revoked embargo. Although US persons are no longer prohibited from engaging in transactions with persons on OFAC’s Specially Designated Nationals and Blocked Persons (SDN) List, which appear with the [SUDAN] tag – indicating a Government of Sudan designation – which were removed on October 12, 2017 from the SDN list, it is important to note that transactions with SDNs designated for other reasons, including terrorism and Darfur-related sanctions, remain prohibited.
The export and reexport of agricultural commodities, medicine, or medical devices to Sudan remains subject to certain limitations.
Along with the October 6 announcement, OFAC issued a new general license authorizing certain transactions pursuant to the Trade Sanctions Reform and Export Enhancement Act of 2000. Despite the broad revocation of the comprehensive embargo on Sudan, a license is still required for certain exports and reexports to Sudan of agricultural commodities, medicine, and medical devices; this is a work-around to generally authorize TSRA exports to Sudan, while Sudan remains on the State Sponsor of Terrorism List. General License A, which goes into effect on October 12, 2017, provides that:
[A]ll exports and reexports of agricultural commodities, medicine, or medical devices to the Government of Sudan or to any entity in Sudan or to any person in a third country purchasing specifically for resale to any of the foregoing are authorized, provided that the exports and reexports are shipped within the 12-month period beginning on the date of the signing of the contract for export or reexport.
General License replaces the need for any existing general or specific licenses currently issued to authorize conduct otherwise prohibited under the Sudan sanctions program. OFAC will re-evaluate whether to renew General License A on an annual basis.
Arent Fox’s International Trade practice will continue to monitor developments in this area. If you have any questions, please contact Kay Georgi, Regan Alberda, or the Arent Fox professional who usually handles your matters.
On October 6, 2017, the US Government announced that it will revoke certain sanctions with respect to Sudan, pursuant to Executive Order 13761, as amended by EO 13804, effective October 12, 2017. The State Department report found that the Government of Sudan had sustained the positive developments in its conduct. The announcement and action represent the lifting of the comprehensive embargo on Sudan, although some restrictions and limitations remain.
As a result of the prohibitions in sections 1 and 2 of EO 13067 and EO 13412 being revoked, US persons are no longer be subject to the prohibitions of the Sudanese Sanctions Regulations, 31 C.F.R. 538, although this section of the OFAC regulations has not yet been removed from volume 31 of the Code of Federal Regulations. On October 12, OFAC removed a long list of SDNs which were only designated under the [SUDAN] designation.
Despite the broad opening to engage Sudan, US persons and non-US persons are still required, as applicable, to obtain licenses from BIS to export or reexport certain items (i.e., commodities, software, and technology) that appear on the CCL, as well as for transactions involving EAR99 items that do not appear on the CCL, if they will be used for restricted end uses such as certain nuclear, missile/rocket, and chemical and biological weapon end uses, or are for restricted end-users.
In addition, US persons taking advantage of the lifting of the Sudanese embargo must bear in mind that the revocation of prohibitions under the SSR and EOs 13067 and 13412 has no impact on other Sudan-related sanctions programs, namely the Darfur Sanctions Regulations, 31 C.F.R. part 546 and South Sudan Sanctions Regulations, 31 C.F.R. 558.
Moreover, numerous Sudanese entities and individuals remain blocked under EOs not impacted by the revoked embargo. Although US persons are no longer prohibited from engaging in transactions with persons on OFAC’s Specially Designated Nationals and Blocked Persons (SDN) List, which appear with the [SUDAN] tag – indicating a Government of Sudan designation – which were removed on October 12, 2017 from the SDN list, it is important to note that transactions with SDNs designated for other reasons, including terrorism and Darfur-related sanctions, remain prohibited.
General License A: Agricultural Commodities, Medicine & Medical Devices
The export and reexport of agricultural commodities, medicine, or medical devices to Sudan remains subject to certain limitations.
Along with the October 6 announcement, OFAC issued a new general license authorizing certain transactions pursuant to the Trade Sanctions Reform and Export Enhancement Act of 2000. Despite the broad revocation of the comprehensive embargo on Sudan, a license is still required for certain exports and reexports to Sudan of agricultural commodities, medicine, and medical devices; this is a work-around to generally authorize TSRA exports to Sudan, while Sudan remains on the State Sponsor of Terrorism List. General License A, which goes into effect on October 12, 2017, provides that:
[A]ll exports and reexports of agricultural commodities, medicine, or medical devices to the Government of Sudan or to any entity in Sudan or to any person in a third country purchasing specifically for resale to any of the foregoing are authorized, provided that the exports and reexports are shipped within the 12-month period beginning on the date of the signing of the contract for export or reexport.
General License replaces the need for any existing general or specific licenses currently issued to authorize conduct otherwise prohibited under the Sudan sanctions program. OFAC will re-evaluate whether to renew General License A on an annual basis.
Arent Fox’s International Trade practice will continue to monitor developments in this area. If you have any questions, please contact Kay Georgi, Regan Alberda, or the Arent Fox professional who usually handles your matters.
[1] On January 13, 2017, then President Obama issued EO 13761, “Recognizing Positive Actions by the Government of Sudan and Providing for the Revocation of Certain Sudan-Related Sanctions,” thereby revoking the prohibitions in sections 1 and 2 of EO 13067 – which comprehensively embargoed Sudan – and all of EO 13412, provided that the Government of Sudan sustained certain positive developments, including the cessation of hostilities in conflict areas, continued improvement of humanitarian access throughout Sudan, and maintaining cooperation with the United States on addressing regional conflicts and the threat of terrorism. Section 10 of EO 13761 required that the Secretary of State provide the President a report describing the actions taken by the Government of Sudan between January 13, 2017 and July 12, 2017, and assessing whether the Government of Sudan satisfied the standard of conduct described above.
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