Today, the United States Department of the Treasury Office of Foreign Assets Control (OFAC) released its quarterly report on licensing under the Trade Sanctions Reform and Export Enhancement Act of 2000 (TSRA). TSRA allows U.S. persons to apply for specific license authorization from OFAC to export agricultural commodities to Cuba and medicine and medical devices to Iran, Cuba, and Sudan. Formerly, TSRA called for licensing exports of agricultural commodities to Iran and Sudan, however, most of those types of transactions were resolved last week when OFAC issued a general license for the export of food to Iran and Sudan.

Generally when this report comes out I look at Graph 1 which details the processing time of license applications under the TSRA program. In the first quarter of 2011, the average processing time for a TSRA license application was 75 days. License approvals on the other hand took an average of 93 days. This is compared with an average processing time of 72 days and an average license approval period of 86 days. This would seem to suggest that OFAC processing times have slowed due to the widely rumored backlog at OFAC.

I wouldn’t be so sure such about any perceived slow down. I have been tracking processing times under the TSRA program for a few years and they do seem to fluctuate. However, I think there a couple of factors which will lead to faster processing times for licenses under this program. First, is the general license for export of food to Iran and Sudan that was mentioned above. This should certainly cut a bulk of the workload down on the personnel working in the TSRA office of OFAC’s Licensing Division. Second, I think more parties are becoming comfortable using OFAC’s online TSRA application process. This also streamlines the process and makes it easier to submit all of the correct information the first.

I will be interested to see how the promulgation of the general license for export of food to Sudan and Iran impacts these processing times. Even if it does nothing to cut back on the processing times, I think it should make parties more open to engaging authorized transactions with Iran and Sudan. Certainly, that seemed to be Congress’ goal in passing TSRA and would be a development that would benefit the people in those sanctioned countries as well as U.S. businesses.

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.