President Obama today issued an Executive Order to impose sanctions against certain individuals and entities involved in the current instability in Ukraine. The president issued the order in direct response to threats to the security and stability of Ukraine and efforts to assert governmental authority in the Crimean region without the authorization of the Government of Ukraine.

The Executive Order blocks the property of any person or entity determined to be responsible for, or complicit in, actions or policies that undermine democratic processes in Ukraine, or that threaten the peace, security, sovereignty and stability of Ukraine. The sanctions also target any person or entity found to be involved with the misappropriation of Ukraine’s state assets. Those who have materially assisted or provided financial support to such persons are also subject to the sanctions, as is any entity that is owned or controlled by, or acting on behalf of, any person whose property is blocked. All transactions involving blocked property are prohibited. In addition, entry into the United States of persons involved with any of the foregoing actions is suspended.

The Executive Order authorizes the Secretary of the Treasury to take actions necessary to carry out the purposes of the order, including promulgating rules and regulations for enforcing the sanctions. The Department of the Treasury’s Office of Foreign Assets Control (OFAC) is charged with issuing regulations and enforcing the sanctions.

In view of these developments, U.S. businesses should assess any ties they may have with persons or entities that could be involved, directly or indirectly, with organizations undertaking actions in Ukraine and the Crimean region in particular. In addition, U.S. businesses on the brink of entering into transactions involving Ukraine, the Russian government, senior officials, or other persons or entities whose property could be blocked, should consider postponing the transactions and taking steps to ensure that any counterparties are not potential targets of the sanctions. It has also been reported that the Russian Parliament has threatened to confiscate U.S. and European property and assets should U.S. and European sanctions be imposed on Russia. U.S. businesses should closely monitor this threat as well.