OFAC Compliance

OFAC issues updated guidance on humanitarian aid to sanctioned and embargoed countries

In a nod that recognizes the need for everyone across the globe to pull together and see those in need through the COVID-19 pandemic, the Office of Foreign Assets Control (OFAC) has issued new directives with regards to providing assistance to countries whose populations may be more vulnerable to the virus.

While some countries have sanctions and embargoes placed upon them for an array of reasons, the United States government is now easing a variety of restrictions in order to help ensure that international aid gets to where it may be needed the most.

What’s changed
Released on April 16, 2020, “Fact Sheet: Provision of Humanitarian Assistance and Trade to Combat COVID-19” provides too many details to list here, but there are overarching themes that run throughout the updated guidelines.

In short:

  1. Iran, Syria, Ukraine/Crimea, Cuba, North Korea, and Venezuela are the countries included in the updated guidance. These countries have been perhaps the hardest hit by U.S. and other international sanctions due to their alleged history of propping up dictatorships, facilitating the trafficking of ideas and goods in support of global terrorism, and a multitude of other nefarious activities.
  2. Included in the loosened restrictions are a variety of goods and services for humanitarian purposes. These include medicine and medical devices (including personal protective equipment (PPE), testing kits, and respirators, etc.), agricultural products, and other commodities deemed to provide the people in these countries the assistance they need during the COVID-19 pandemic.
  3. Generally speaking, in order to be able to send humanitarian aid to these countries, OFAC requires organizations to apply for licenses—though this is nothing new as export licenses and other documentation has long been the norm. Each country has their own license requirements, exemptions and exceptions, so those wishing to help the people of these countries need to follow the guidance issued by OFAC.
  4. Sanctions and embargoes are not designed to hurt the general population of said countries. They are meant to curtail past and current illegal actions by their respective governments, legitimate or otherwise. Another theme running throughout the new guidance is that aid will generally only be approved by OFAC so long as it is not destined for the governments or officials of the above-mentioned countries.

Other humanitarian export considerations
Due to ongoing shortages of some critical PPE supplies in the U.S., on April 22, 2020, the Federal Emergency Management Agency (FEMA) issued guidance on, and implemented an export review process for, certain medical supplies, including N95 masks, respirators, surgical masks, and PPE gloves. Also referred to as the Temporary Final Rule, FEMA will work in conjunction with the U.S. Customs and Border Protection (CBP), with freight destined for export reviewed by CBP via the Automated Export System (AES).

Should goods in the shipment fall within the purview of the Temporary Final Rule—in support of the Defense Production Act—FEMA will be notified, and each shipment reviewed on a case-by-case basis. FEMA then has the legal option to either purchase the goods, either in part or in whole, so they can be made available to the U.S. medical supply chain, or approve the export(s) as is.

Export compliance is rarely straightforward
Despite the relaxation of many sanctions and embargoes as they relate to humanitarian assistance, there are still strict measures in place to help ensure aid isn’t going into the hands of those whose actions put their countries in an export-restrictive status in the first place. Organizations also need to understand that COVID-19 has brought more U.S. government agencies into the export compliance fold. This means that additional research and due diligence is critical during this time, even for those who wish to do their part to stop the Coronavirus dead in its tracks.