On December 19, 2014, in response to the situation in Crimea, President Obama issued a new Executive Order imposing sanctions against the “Crimea region of Ukraine” (“Crimea”), which is currently held by Russia. The Executive Order prohibits:
- new investment in Crimea by a United States person, wherever located;
- the importation into the United States, directly or indirectly, of any goods, services, or technology from Crimea;
- the exportation, reexportation, sale, or supply, directly or indirectly, from the United States, or by a United States person, wherever located, of any goods, services, or technology to Crimea; and
- any approval, financing, facilitation, or guarantee by a United States person, wherever located, of a transaction by a foreign person where the transaction by that foreign person would be prohibited by this section if performed by a United States person or within the United States.
Effectively, this subjects Crimea to a comprehensive sanctions regime similar to that applicable to countries such as Sudan. All transactions within U.S. jurisdiction (including those involving U.S. persons, U.S.-origin goods, or U.S.-origin services) involving Crimea, or persons or entities located, organized, or resident in the territory, are now impermissible. This also means that U.S. dollar transactions clearing through the U.S. financial system (including transactions between foreign persons) relating to Crimea are impermissible and must be rejected by financial institutions. In addition, the Executive Order provides authority to designate and block the assets of Crimean persons or entities, but no designations have yet been made.
The U.S. Department of the Treasury (the “Treasury Department”) simultaneously issued Ukraine General License 4 (“GL 4”) authorizing the sale of certain agricultural commodities, medicine, and medical supplies (including replacement parts) to the Crimea region of Ukraine. GL 4 does not permit the export of any of the above-referenced goods to military or law enforcement purchasers or importers.
Finally, the Treasury Department designated 24 individuals and entities as Specially Designated Nationals pursuant to Executive Order 13660, the original Ukraine-related Executive Order targeting persons found to be directly involved in the crisis in Ukraine. The list of sanctions designations is attached as an appendix.