US – OFAC publishes Ukraine-related General License 5

On December 30, 2014, the Office of Foreign Assets Control (OFAC) published General License No. 5 Authorizing Certain Activities Prohibited by Executive Order 13685 of December 19, 2014 Necessary to Wind Down Operations Involving the Crimea Region of Ukraine.  Except as provided in paragraph (b) of the general license (GL5), it authorizes, through 12:01 a.m. EDT, February 1, 2015, all transactions and activities prohibited by Section 1 of Executive Order 13685 of December 19, 2014, “Blocking Property of Certain Persons and Prohibiting Certain Transactions With Respect to the Crimea Region of Ukraine” (the “Crimea E.O.”), that are ordinarily incident and necessary to

(1) the winding down or divestiture or transfer to a foreign person of a U.S. person’s share of ownership, including an equity interest, in pre-December 20, 2014 investments located in the Crimea region of Ukraine;
(2) the winding down of operations, contracts, or other agreements that were in effect prior to December 20, 2014, involving the exportation, reexportation, sale, or supply of goods, services, or technology to the Crimea region of Ukraine; or
(3) to the winding down of operations, contracts, or other agreements that were in effect prior to December 20, 2014, involving the importation of any goods, services, or technology from the Crimea region of Ukraine into the United States.

Paragraph (b) of GL5 states that GL5 does not authorize:

(1) any new exportation, reexportation, sale, or supply of goods, services, or technology from the United States, or by a U.S. person, wherever located, to the Crimea region of Ukraine, or
(2) any new importation into the United States of goods, services or technology from the Crimea region of Ukraine, except as needed to wind down operations, contracts, or other agreements otherwise prohibited by the Crimea E.O.

GL5 does not authorize any transactions or dealings otherwise prohibited by any other Executive order or any other part of 31 C.F.R. Chapter V, or any transactions or dealings with any specially designated national (SDN) listed pursuant to any Ukraine-related Executive order.

U.S. persons participating in transactions authorized by GL5 are required, within 10 business days after the wind-down activities conclude, to file a detailed report, including the parties involved, the type and scope of activities conducted, and the dates of the activities, with the Office of Foreign Assets Control, Licensing Division, U.S. Department of the Treasury, 1500 Pennsylvania Avenue N.W., Annex, Washington, DC 20220.

For more specific updates on this topic, please consult Baker & McKenzie’s Sanctions Update blog www.bakermckenzie.com/sanctionsnews/.