On March 15, 2022, the United States added additional Russian and Belarusian individuals and one Russian entity to the Department of the Treasury’s Office of Foreign Assets Control (OFAC) list of Specially Designated Nationals and Blocked Persons (SDN List). The designations include 11 Russian nationals “who operate or have operated in the defense and related material sector of the Russian Federation economy,” four Russian individuals and one Russian entity for gross human rights abuses and the redesignation of a Belarusian official and designation of his wife for involvement in public corruption. The designations were accompanied by a statement from OFAC condemning “Russia’s attacks on humanitarian corridors in Ukraine and [calling] on Russia to cease its unprovoked and brutal war against Ukraine” but not all of the March 15 designations were related to recent events in Ukraine.

The 11 senior Russian defense officials were designated under Executive Order 14024, the 2021 order that has served as the basis for many of the recent designations. The designations of the Russian individuals and entity for human rights abuses were made under the authority of the Sergei Magnitsky Rule of Law Accountability Act of 2012; these designations include one Russian judge said to have participated in efforts to conceal the circumstances surrounding the detention, abuse or death of Sergei Magnitsky as well as two Russian officers and a Russian judge alleged to have been involved in human rights abuses against Chechen human rights activists. The President of Belarus, Alyaksandr Ryhorovich Lukashenka, and his wife were designated under a section of a 2006 Executive Order, Executive Order 13405, targeting officials and their close family members responsible for public corruption in Belarus (Lukashenka himself having been previously designated in the original Annex to a separate section of the order). As a result of the SDN designations, U.S. persons are now prohibited from conducting any business with any of the designated individuals or entity as well as any entity owned fifty percent of more, individually or in the aggregate by them, and must block their property and interests in property in the United States or in the possession or control of U.S. persons.

This most recent spate of designations appears to signal OFAC’s intention to use all available sources of authority in its ongoing campaign to punish Russian and Belarusian actors for malign activities.

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This Alert is a tool to help businesses, both US and foreign, identify whether their business with Russia, Belarus or Ukraine may now be subject to US export license requirements or involve newly sanctioned or blocked persons. The Alert cannot be relied upon as legal advice; the sanctions and export controls are complex, detailed, and continuing to develop and legal counsel should be sought for guidance on specific transactions.
 

Please do not hesitate to reach out to any member of our International Trade and National Security team or your BakerHostetler relationship partner with questions. BakerHostetler continues to closely monitor the situation.