Search for:
Sanctions

US State, Labor, and Commerce Departments Issue South Sudan Business Advisory

By 2 Mins Read

On August 14, 2023, the US State Department, the Labor Department, and the Commerce Department issued a business advisory (“Business Advisory”) highlighting key risks for companies operating in South Sudan.

While it does not impose new legal obligations on companies, the Business Advisory highlights the fact that list-based sanctions remain in force targeting certain South Sudanese persons including designations under the US Treasury Department’s Office of Foreign Assets Control’s Specially Designated Nationals and Blocked Persons List, and the US Commerce Department’s Bureau of Industry and Security’s Entity List. Our prior blog post about these risks can be reviewed here.

The Business Advisory also recommends that US financial institutions continue to submit suspicious activity reports and perform proper due diligence on South Sudanese political figures as already required and outlined in a 2017 advisory from the US Treasury Department’s Financial Crimes Enforcement Network. Annex 1 and Annex 2 of the Business Advisory provide a further overview of companies legal and due diligence obligations when dealing with South Sudan parties, including a focus on issues related to forced labor in South Sudan.

The Business Advisory focuses on the following key areas of concern:

  • Government Tenders: Transparency International ranked South Sudan as the country with the world’s worst public sector corruption in its 2021 rankings of perception of corruption; South Sudan tied for second-worst in 2022.
  • Oil and Gold:  The Business Advisory alleges substantial diversion of revenue from the oil and gold industries to fund illicit activities or payments to government officials.
  • Contracts managed by governing entities for delivery of assistance: Companies should flag for compliance review unnecessary fees, engagement with unqualified companies, and diversion of funds intended for humanitarian relief.
  • Arms, Military Equipment, and Related Activity: The Business Advisory cautions companies against dealings with South Sudanese armed forces due to alleged human rights abuses.
Categories:
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

Alexandre Lamy joined Baker McKenzie in 2009 and currently works in the Firm's International Trade Practice Group. He assists clients with sanctions and export controls (Export Administration Regulations (EAR); International Traffic in Arms Regulations (ITAR)) and he advises clients on corporate compliance matters. Alex contributes regularly to Baker McKenzie's Sanctions & Export Controls Update blog.
Since August 2021, Alex has been the co-chair of the ABA Section of International Law’s Export Controls & Economic Sanctions Committee. Prior to that appointment, he served on the steering group and as a Vice Chair of the Committee, starting back in August 2011. Alex has organized multiple events regarding recent developments in US trade sanctions and export controls for the Committee.
Alex was recognized in Who's Who Legal 2020 Edition of its Global Guide to Trade & Customs Lawyers as a "leading individual" in North America on International Sanctions and the publication reported that he "attracts applause for delivering 'a practical service which understands the needs of the business'. His 'ready availability to clients, thorough research and strong presentation skills' are further acclaimed." He was also recognized in the 2019 Edition of the same publication as being "much sought after by clients who praise his 'advice of the highest quality' and add, 'He is technically very good on OFAC sanctions issues and military/dual use export controls.'" Alex was named by Financier Worldwide in, “POWER PLAYERS: International Trade & Sanctions 2021 - Distinguished Advisers.

Author

Andrea Tovar regularly advises multinational companies on cross-border commercial transactions and complex privacy and international trade matters. Andrea is also a member of the Firm’s Technology, Media & Telecoms Global Industry Group and Co-Chairs the North America Baker Unidos Affinity Group.

Related Posts

Write A Comment