Key takeaways to increase your profits

  • Primary/comprehensive sanctions: Prohibits citizens and companies of the sanctioning country from engaging with their counterparts in the sanctioned country
  • Secondary/supplementary sanctions: Halts activity with the sanctioned country by threatening to sever its access to the US market
  • Sectoral/targeted sanctions: Prohibits citizens and companies of the sanctioning country from engaging with people and companies in sector-specific transactions
  • Settlement 1: Société Internationale de Télécommunications Aéronautiques SCRL (SITA)
  • Settlement 2: Eagle Shipping International USA LLC (Eagle Shipping)
  • Settlement 3: Park Strategies, LLC (Park Strategies)
  • Entered into a contract with a Somalian company to engage in lobbying activity in relation to real estate deals with various divisions of the US government, violating GTSR
  • The OFAC identified violations through the company’s self-disclosure, and the company blocked the first payment of the contract as soon as it had realised the breach
  • Settlement 4: BIOMIN America, Inc. (BIOMIN)
  • Secondary sanctions are applicable not only to companies in the home country but also to companies that leverage a global network of offices to deliver their services
  • To transact under sanctions regimes, a company could obtain a general licence or a specific one from the OFAC
  • Sanctions could be enforced even though the original executive order is no longer effective
  • Sanctions regimes cover vast areas and could relate to transactions where a company acts as a third party to buy/sell goods or services
  • It is important to conduct a fool-proof due diligence review and audit, both before and after an acquisition
  • Self-disclosure is a good thing and leads only to nominal fines, with minimal business impact. Companies should also constantly and closely watch for the following:
  • Extensive sanctions due diligence, remedial proposals and accurate sanction reporting on companies/groups of companies
  • Expert advice from a team of sanction compliance specialists on deals, projects, mergers and other such activity
  • Training and development programmes to up-skill compliance teams to deal with real-time sanction risks



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Acuity Knowledge Partners

Acuity Knowledge Partners

We write about financial industry trends, the impact of regulatory changes and opinions on industry inflection points.