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September 29, 2017

OFAC Modifies Ukraine-/Russia-Related Directive 1, 2

Today, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) amended Ukraine-/Russia-related Directive 1 and Directive 2 in order to implement the Countering America’s Adversaries Through Sanctions Act – the new law which, among other things, strengthens current sanctions on Russia and imposes new sanctions on the country.  All activities previously prohibited under Directives 1 and 2 remain prohibited.  In addition, OFAC modified Directive 1 to prohibit dealings in new debt of longer than 14 days maturity or new equity if that debt or equity is issued on or after Nov. 28, 2017 by, on behalf of, or for the benefit of the persons operating in Russia’s financial sector named under Directive 1, their property, or their interests in property.   (The prior version of Directive 1 prohibited the same activities, but involving debt of longer than 30 days maturity or new equity.)  Directive 2 was modified to prohibit dealings in new debt of longer than 60 days maturity if issued on or after Nov. 28, 2017 by, on behalf of, or for the benefit of the persons operating in Russia’s energy sector named under Directive 2 (including their property or interests in property).  (The prior version of Directive 2 prohibited the same activities, but involving debt of longer than 90 days).