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On November 26, 2021, the US Treasury Department’s Office of Foreign Assets Control (“OFAC”) published a final rule amending the Syrian Sanctions Regulations (“Final Rule”). The Final Rule expands the existing general license at § 542.516 (the “General License”) to authorize nongovernmental organizations (“NGOs”) to engage in certain assistance-related investment activities in support of not-for-profit activities in Syria. 

The General License authorizes NGOs to export/reexport services to Syria in support of not-for-profit activities in Syria, i.e., humanitarian projects that meet basic human needs; democracy-building; education; non-commercial development projects directly benefitting the Syrian people; and the preservation and protection of cultural heritage sites. The Final Rule amends the General License to expand the authorization for NGOs to also engage in the following transactions and activities in support of not-for-profit activities in Syria:

  • Transactions with persons who meet the definition of the term Government of Syria (i.e., the state and the Government of the Syrian Arab Republic, as well as any political subdivision, agency, or instrumentality thereof, including the Central Bank of Syria);
  • New investment (i.e., a transaction that constitutes a commitment or contribution of funds or other assets, or a loan or other extension of credit) in Syria; and
  • Purchase of refined petroleum products of Syrian origin for use in Syria.

The newly published Syria FAQs 937 and 938 confirms that the General License authorizes US financial institutions to process transfers of funds in support of the authorized transactions and activities outlined above. Further, non-US persons, including NGOs and foreign financial institutions, do not risk exposure to US secondary sanctions) for engaging in activities that would otherwise be authorized or exempt for US persons under the Syrian Sanctions Regulations. 

Author

Terry Gilroy is a partner in the New York office of Baker McKenzie and a member of the Compliance and Investigations Practice Group. Prior to joining the Firm in 2018, Terry served as Americas Head of the Financial Crime Legal function at Barclays. Terry advises businesses and individuals on white collar and financial crime issues and has significant experience conducting investigations relating to compliance with the US Foreign Corrupt Practices Act (FCPA) and related bribery and corruption statutes, economic sanctions regulations as administered by the US Department of the Treasury's Office of Foreign Assets Control (OFAC), and the Bank Secrecy Act and related anti-money laundering (AML) regulations and statutes. Terry spent six years on active duty in the United States Army as a Field Artillery officer.

Author

Lise Test, an associate in Baker & McKenzie’s International Trade Group in Washington, DC, practices in the area of international trade regulation and compliance — with emphasis on US export control laws, trade sanctions, anti-boycott laws and the Foreign Corrupt Practices Act. Prior to joining Baker & McKenzie, Ms. Test served as a lawyer at the Danish Ministry of Defence where she focused on international public law and Danish torts, administrative law and military criminal law. In addition to her practice, Ms. Test also taught international humanitarian law and contract law at the Danish Royal Naval Academy.

Author

Andrea Tovar regularly advises multinational companies on cross-border commercial transactions and complex international trade matters. Andrea is also a member of the firm’s Technology, Media & Telecommunications Global Industry Group and the California Diversity & Inclusion Committee.

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