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What happened?

Effective July 23, 2024, all U.S. banks, insurers, SEC broker/dealers, securities or commodities broker/dealers, investment bankers, investment companies, currency exchanges and certain other entities designated as “financial institutions” must report to the U.S. Department of Treasury, Office of Foreign Assets Control (OFAC), no later than August 2, 2024 or within 10 days of detection, any Russian sovereign assets that they know (or should know) are in their possession or control (including any such assets held in correspondent or payable-through accounts of foreign financial institutions) unless the assets have already been reported to OFAC in a blocked property report or a report filed pursuant to Directive 4 to Executive Order 14024 [1] (which, as amended on May 19, 2023, requires U.S. persons to file annual reports by June 30 of property in which the Central Bank of the Russian Federation, the Russian National Wealth Fund, or the Ministry of Finance of the Russian Federation has an interest).

The new reporting requirement was announced in Reporting Instructions [2] issued by OFAC on July 23, 2024, in accordance with Section 104(a) of the Rebuilding Economic Prosperity and Opportunity for Ukrainians Act [3], P.L. 118-50, Division F (the “REPO for Ukrainians Act”).

Key definitions

“Russian sovereign assets” means funds and other property of: (1) the Central Bank of the Russian Federation, (2) the Russian National Wealth Fund, (3) the Ministry of Finance of the Russian Federation, or (4) any other part of the Government of the Russian Federation, including any subdivision, agency, or instrumentality.

“Financial institution” means entities specified in 31 U.S.C. 5312(a)(2)(A)-(J), (M), or (Z), i.e.: (1) an insured bank per 12 U.S.C. 1813(h) (Federal Deposit Insurance Act); (2) a commercial bank or trust company; (3) a private banker; (4) an agency or branch of a foreign bank in the United States; (5) any credit union; (6) a thrift institution; (7) a broker or dealer registered with the SEC; (8) a broker or dealer in securities or commodities; (9) an investment banker or investment company; (10) a currency exchange, or other business engaged in the exchange of currency, funds, or value that substitutes for currency or funds; (11) an insurance company; or (12) any other business designated by the Secretary whose cash transactions have a high degree of usefulness in criminal, tax, or regulatory matters.

Reporting instructions

Reports must be submitted via email to ofacreport@treasury.gov, with subject line, “[Name of Financial Institution] REPO for Ukrainians Act Report]”, using the REPO for Ukrainians Act Report Form [4].

Required data includes:

(1) The name and address of the financial institution (FI) in possession or control of the property;

(2) The date the property came into the FI’s possession or control;

(3) The person that owns the account or property;

(4) A description of the property and its location (in the United States or otherwise), including account types, account numbers, reference numbers, dates, or other information necessary to identify the property;

(5) The actual or (if unknown) estimated value of the property in U.S. dollars (foreign currencies must be reported in U.S. dollars with the foreign currency amount and notional exchange rate in the narrative); and

(6) A copy of the most recent relevant account statement or other documentation to support the estimated value of the property.

For more information on the topics covered in this advisory or any other aspect of U.S. export controls or economic sanctions, contact Partner Tahlia Townsend, co-chair of Wiggin and Dana’s International Trade Compliance Practice Group.

[1] Directive 4 to Executive Order 14024, available at https://ofac.treasury.gov/media/918806/download?inline

[2] Reporting Instructions, available at https://ofac.treasury.gov/media/933066/download?inline

[3] Rebuilding Economic Prosperity and Opportunity for Ukrainians Act, available at https://www.congress.gov/bill/118th-congress/house-bill/815/text#HA6767E6EC9AE47A7A1476DB48981A44E

[4] REPO for Ukrainians Act Report Form, available at https://ofac.treasury.gov/media/933061/download?inline