On October 6, 2017, the US Government announced that it will revoke certain sanctions with respect to Sudan and the Government of Sudan, effective October 12, 2017. As a result of the revocation, US Persons will no longer be prohibited from engaging in Sudan-related transactions that were previously prohibited under the Sudanese Sanctions Regulations (“SSR”), including dealings with the Government of Sudan, and the SSR will be removed from the US Code of Federal Regulations.
As detailed in our previous blog posts here and here, the revocation of the Sudan sanctions is being made pursuant to Executive Order 13761 of January 13, 2017, which called for termination of the sanctions in July 2017 provided that the Government of Sudan continued to sustain certain positive actions, and Executive Order 13804 of July 11, 2017, which kept the sanctions in place and extended the review period for an additional three months. During the review period, US Persons have been authorized to engage in transactions otherwise prohibited under the SSR pursuant to a general license issued by the US Treasury Department’s Office of Foreign Assets Control (“OFAC”), as discussed in our previous posts.
As detailed in FAQs issued by OFAC, despite the October 12, 2017 revocation of the sanctions, a number of Sudan-related restrictions will remain in place, including the following (among others):
- Due to Sudan’s continued designation as a State Sponsor of Terrorism, certain exports/reexports to Sudan of agricultural commodities, medicine, and medical devices continue to require a license pursuant to the Trade Sanctions Reform and Export Enhancement Act of 2000. To that end, OFAC has issued General License A, which authorizes all exports/reexports of agricultural commodities, medicine, or medical devices to the Government of Sudan or to any entity in Sudan or to any person in a third country purchasing for resale to any of the foregoing, provided that shipment is made within 12 months of signing the contract for export/reexport. We note that General License A does not eliminate the requirement to comply with other US Government regulations related to Sudan, including but not limited to the Export Administration Regulations (“EAR”), which impose separate controls on certain exports/reexports to Sudan, as detailed further below.
- The revocation of the sanctions does not affect any export/reexport controls related to Sudan under the EAR, which are maintained by the US Commerce Department’s Bureau of Industry and Security (“BIS”). Pursuant to the EAR, both US Persons and non-US Persons are required to obtain a license from BIS in order to export/reexport “controlled” (i.e., non-EAR99) goods, software, or technology (collectively, “items”) that are subject to US jurisdiction to Sudan. The export/reexport of EAR99 items to Sudan may also require a BIS license if such transactions implicate certain end-use or end-user concerns under the EAR.
- OFAC sanctions related to the conflict in Darfur remain in place, and US Persons remain prohibited from engaging in any transactions with Specially Designated Nationals (“SDNs”) identified under the [DARFUR] tag on OFAC’s Specially Designated Nationals and Blocked Persons List (“SDN List”).
- US Persons remain prohibited from engaging in dealings with Sudanese SDNs designated pursuant to any sanctions authorities other than Executive Order 13067 and Executive Order 13412, including, e.g., SDNs designated for activities related to South Sudan (i.e., identified under the [SOUTH SUDAN] tag on the SDN List) or terrorism-related activities (i.e., identified under the [SDGT] tag on the SDN List). To clarify further, only those persons identified under the [SUDAN] tag on the SDN List will no longer be designated.
- While unrelated to the sanctions, we also note that generally clients conducting business in Sudan should also be aware of certain risks related to antiboycott regulations, which prohibit US Persons from complying with the Arab League boycott of Israel and impose certain reporting requirements.
Further details regarding the US Government’s decision to revoke the Sudan sanctions as a result of the Government of Sudan’s positive actions, including related to maintaining a cessation of hostilities in Sudan, improving humanitarian access throughout Sudan, and cooperating with the US Government on addressing regional conflicts and terrorism, can be found in the State Department’s press statement and report related to the revocation of the sanctions.