OFAC: new FAQs on the term ‘maintenance’ in Russia general licences

The US Department of the Treasury’s Office of Foreign Assets Control (‘OFAC’) has published two new FAQs on the term ‘maintenance’ used in a series of general licences issued to allow certain dealings with Russian companies sanctioned by Washington in April (14 September).

General Licenses 14, 15 and 16 authorise ‘the maintenance and winding down’ of business with RUSAL, GAZ Group, and EN+ Group and their subsidiaries until 23 October 2018.

The FAQs state that the type of activities that are considered ‘maintenance’ are ‘all transactions ordinarily incident to the continuity of operations.’ For the purposes of General Licenses 14, 15 and 16 this will be ‘all transactions and activities ordinarily incident to performing under a contract or agreement in effect prior to April 6, 2018’, which is ‘consistent with past practices.’ For example, the ‘issuing or accepting of purchase orders and making or receiving shipments consistent with the terms of the general licence that were initiated after April 6, 2018 involving the blocked entities if such activity is ordinarily incident and necessary to contracts in effect prior to April 6, 2018.’

For details of OFAC’s new FAQS see:
https://www.treasury.gov/resource-center/faqs/Sanctions/Pages/faq_other.aspx#625