On August 2, 2017, the President signed into law the "Countering America's Adversaries Through Sanctions Act," providing a number of new sanctions against Russia, Iran, and North Korea.1 The President also issued a signing statement2 setting forth the Administration's views on the contents and constitutionality of the Act.
The Act includes the following sanctions measures relating to each of the three sanctions programs:
Russia: The Act codifies existing sanctions under the cybersecurity and Ukraine/Russia-related sanctions programs; tightens restrictions under sectoral sanctions by adding new sectors and shortening maturity dates for Directives 1, 2, and 4; adds additional sanctions measures by providing for secondary sanctions for persons determined to be engaging in certain activities relating to the Russian energy, defense, or intelligence sectors and for persons determined to be assisting or providing support for significant activities undermining cybersecurity; and requires the President to block and prohibit all transactions in property and interests in property of persons determined to be engaging in significant activities undermining cybersecurity, Russian Government officials or close associates or relatives of Russian Government officials determined to be engaging in acts of significant corruption, foreign persons determined to be evading sanctions, foreign persons determined to be committing human rights abuses, or foreign persons determined to be providing or engaging in activities related to providing arms to Syria.
Iran: The Act requires the President to block and prohibit all transactions in property and interests in property of persons determined to be providing support to Iran's ballistic missile program or engaging in activities that materially contribute to Iran's acquisition of specified arms and related materials or providing technical training, financial resources, or other services related to the acquisition or use of such materials; authorizes the President to block and prohibit all transactions in property and interests in property of foreign persons or their agents who are determined to have committed human rights abuses against certain parties; and requires the President to designate the Iranian Revolutionary Guard Corps ("IRGC") and foreign persons that are officials, agents, and associates of the IRGC as Specially Designated Global Terrorists ("SDGTs") on the List of Specially Designated Nationals and Blocked Persons ("SDN List") administered by the US Department of the Treasury's Office of Foreign Assets Control ("OFAC").
North Korea: The Act provides for additional sanctions measures to aid in the enforcement of United Nations ("UN") Security Council Resolutions and to counteract the commission of human rights abuses, particularly those related to forced labor, by requiring the designation of parties determined to be acquiring certain types of ore from North Korea or conducting activities relating to designated aircraft or vessels; authorizing the designation of parties determined to be operating in the transportation, mining, energy, or financial services industries of North Korea or determined to have purchased specified items from, conducted transfers for, or provided certain materials to the North Korean Government; prohibiting US persons from operating correspondent accounts for the benefit of North Korea; requiring the withholding of assistance from foreign governments determined to be providing to or receiving from North Korea defense articles or services; requiring additional restrictions on North Korean vessels and vessels of countries not complying with UN Security Council Resolutions relating to North Korea; prohibiting the import of North Korean goods unless it can be proven by "clear and convincing evidence that [they]…were not produced with convict labor, forced labor, or indentured labor under penal sanctions"; and requiring the President to block and prohibit all transactions in property and interests in property of foreign persons identified as employing North Korean laborers.
For all three programs, the Act expands the scope of activities for which a party could be designated on OFAC's SDN List. For individuals and entities on the SDN List, all transactions in property and interests in property of these individuals and entities located in the United States or within the possession or control of a US person, wherever located, are considered blocked and may not be dealt in. Any entity in which one or more blocked persons directly or indirectly holds a 50 percent or greater ownership interest in the aggregate is itself considered blocked by operation of law. US persons may not engage in any dealings, directly or indirectly, with blocked persons.