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Last September, President Obama issued Executive Order 13553 which called for the identification and targeting for sanctions of parties engaged in serious human rights abuses in Iran or against Iranian citizens and their family members. Those parties targeted are to be placed on the Specially Designated Nationals List, otherwise referred to as the OFAC SDN List.

Here are some of the major points from this new sanctions program:

1. As in all OFAC SDN List designations, U.S. persons are prohibited from engaging in transactions with those parties on the SDN List. Also, an OFAC SDN List designation has the effect of blocking all of the target’s assets under U.S. jurisdiction. The same holds true for this new sanctions program.

2. If a party designated as an SDN under this new sanctions program owns 50% or greater of any entity, then that entity and its assets will also be blocked. This blocking is to take place regardless of whether or not the entity appears on the OFAC SDN List.

3. Most legal services to SDNs designated under the Iranian Human Rights Abuses Sanctions Regulations are authorized. However, much like in the case of the Foreign Narcotics Kingpin Sanctions Regulations, payment for those legal services must be specifically licensed.

4. Emergency medical services in the United States for those SDNs designated under this program are authorized. However, payment for those services must be specifically licensed.

The last section kind of surprised me. Although I think its great that OFAC has issued a general license authorization allowing for emergency medical services, I don’t know what doctor is going to want provide such services when there is no guarantee that they can be paid. Now I doubt this section will be utilized much, if ever, but if it were common for SDNs designated under this program to require medical services, I don’t think there are many doctors who would even know that they need a specific license to receive payment. In that scenario there would be a lot of doctors in danger of being hit with an OFAC investigation. Alas, I don’t think that scenario is likely to occur, but it is interesting to consider.

As I have stated time and time again, OFAC SDN List removals are difficult, but not impossible. There is a process to be followed and with the right frame of mind and the right attorney being removed from the OFAC SDN List is possible.

The author of this blog is Erich Ferrari, an attorney specializing in OFAC matters. If you have any questions please contact him at 202-280-6370 or ferrari@ferrari-legal.com.

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