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Today the Department of the Treasury’s Office of Foreign Asset Controls (OFAC) added Public Joint Stock Company Rosbank (Rosbank), one of Russia’s largest banks, to its Specially Designated Nationals and Blocked Persons List, pursuant to Executive Order 14024.  Concurrent with today’s action, OFAC issued three general licenses authorizing limited transactions involving Rosbank (GL8E, GL58, GL59), which are described below, and published one FAQ describing the activities authorized during the wind-down periods for transactions involving Rosbank. 

As a result of this action, all property and interests in property of Rosbank that are in the U.S. or in the possession or control of U.S. persons are blocked and must be reported to OFAC.  In addition, under the 50 Percent Rule, any entities that are owned, directly or indirectly, individually or in the aggregate, 50 percent or more by Rosbank, its 50 Percent Rule entities, or other blocked persons are also blocked.  Unless authorized by a general or specific license issued by OFAC, or otherwise exempt, all transactions by U.S. persons or within (or transiting) the U.S. that involve any property or interests in property of Rosbank or its 50 Percent Rule entities are prohibited. 

The three general licenses published today that authorize limited transactions involving Rosbank are described below:

• General License 8E (Authorizing Transactions Related to Energy) authorizes transactions with Rosbank, its 50 Percent Rule entities, and other listed entities that are “related to energy,” subject to the limitations set forth in paragraphs (c) of the general license.  For the purposes of this general license, the term “related to energy” means the extraction, production, refinement, liquefaction, gasification, regasification, conversion, enrichment, fabrication, transport, or purchase of petroleum, including crude oil, lease condensates, unfinished oils, natural gas liquids, petroleum products, natural gas, or other products capable of producing energy, such as coal, wood, or agricultural products used to manufacture biofuels, or uranium in any form, as well as the development, production, generation, transmission, or exchange of power, through any means, including nuclear, thermal, and renewable energy sources.
• General License 58 (Authorizing the Wind Down and Rejection of Transactions Involving Public Joint Stock Company Rosbank): (a) authorizes transactions that are ordinarily incident and necessary to the wind down of transactions involving Rosbank or its 50 Percent Rule entities through 12:01 a.m. EDT, March 15, 2023, provided that any payment to Rosbank or its 50 Percent Rule entities is made into a blocked account; and (b) authorizes U.S. persons to reject, rather than block, prohibited transactions that are ordinarily incident and necessary to the processing of funds involving Rosbank or its 50 Percent Rule entities as an originating, intermediary, or beneficiary financial institution, through 12:01 a.m. eastern daylight time, March 15, 2023, provided that any payment to Rosbank or its 50 Percent Rule entities is made into a blocked account in accordance with the Russian Harmful Foreign Activities Sanctions.  Limitations are set forth in paragraph (c) of the general license.
• General License 59 (Authorizing Transactions Related to Debt or Equity of, or Derivative Contracts Involving, Public Joint Stock Company Rosbank): (a) authorizes transactions that are ordinarily incident and necessary to the divestment or transfer, or the facilitation of the divestment or transfer, of debt or equity of Rosbank or its 50 Percent Rule entities (“covered debt or equity”) to a non-U.S. person through 12:01 a.m. EDT, March 15, 2023; (b) authorizes transactions that are ordinarily incident and necessary to facilitating, clearing, and settling trades of covered debt or equity that were placed prior to 4:00 p.m. eastern standard time, December 15, 2022, through 12:01 a.m. EDT, March 15, 2023; and (c) authorizes transactions that are ordinarily incident and necessary to the wind down of derivative contracts entered into prior to 4:00 p.m. EST, December 15, 2022, that (i) include Rosbank or its 50 Percent Rule entities as a counterparty or (ii) are linked to covered debt or equity, through 12:01 a.m. EDT, March 15, 2023, provided that any payment to a blocked person is made into a blocked account in accordance with the Russian Harmful Foreign Activities Sanctions.  Limitations are set forth in paragraphs (d) and (e) of the general license.

OFAC FAQ 1103, which was also published today, describes the activities that are and are not authorized during the wind-down periods for transactions involving Rosbank under GL58 and GL59.

For more information or advice about OFAC sanctions, contact Wiggin and Dana’s International Trade Compliance Practice Group.