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October 26, 2017

OFAC Modifies Ukraine-/Russia-Related Directives 1 & 2

On September 29, 2017, 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, extends and authorizes new sanctions on Russia, Iran, and North Korea.  OFAC modified Directive 1 to prohibit dealings in new debt of longer than 14 days maturity if that debt is issued on or after November 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 issuance of debt of longer than 30 days maturity.)  Directive 2 was modified to prohibit dealings in new debt of longer than 60 days maturity if issued on or after November 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).  In addition, all activities previously prohibited under Directives 1 and 2, including the issuance of equity, remain prohibited. 

For more information on the Countering America’s Adversaries Through Sanctions Act, please see our previous article here.