Last Friday, pursuant to the Sergei Magnitsky Rule of Law Accountability Act, the United States publicly named eighteen individuals, including a number of Russian government officials, as having been involved in the detention, abuse or death of Sergei Magnitsky or other human rights abuses in Russia. Magnitsky, a Russian citizen who had been investigating corruption in Russia, died in a Russian jail after failing to receive required care for a number of serious medical conditions.
Russia quickly responded on Saturday naming eighteen U.S. nationals it said were involved in human rights abuses in the United States. The list includes former Bush Administration officials, like David Addington and John Yoo, who were involved in the development of U.S. policy toward detainees at Guantanamo Bay, as well as individuals, such as U.S. District Court Judge Jed Rakoff, who were involved in U.S. prosecutions of Viktor Bout and Konstantin Yaroshenko, two Russian nationals, for alleged arms or drug smuggling.
The Magnitsky Act bars the U.S.-named individuals from entry into the United States and requires the President to “freeze and prohibit all transactions in all property and interests in property of a person” named pursuant to the Act if such property or property interests are in the United States or in the possession or control of a U.S. person. So far as we can tell, the Russian sanctions against named U.S. nationals bar their entry into Russia but do not go any further.
The United States has not yet published regulations to implement the Magnitsky Act’s requirement that property or interests in property be frozen and that transactions in such property be prohibited. As we know from experience, the exact wording of regulations of this kind can make a great deal of difference in how they apply and what kinds of transactions or interests are affected. The Magnitsky Act’s wording, which couples a freeze order with a prohibition on transactions, suggests, however, that the regulations that are eventually promulgated are likely to be quite broad in scope.
In the meanwhile, the State Department says, without benefit of regulations, that for named Magnitsky Act individuals, “[t]heir property and interests in property subject to U.S. jurisdiction are blocked, and transactions in such property or interests in property are prohibited.” (Emphasis supplied.) Those who might be affected will simply have to guess which of the variations on these core concepts will be adopted in the yet to be published regulations.