International Law Advisory - Treasury Department Issues New List of Countries Participating in Arab Boycott of Israel

The U.S. Department of the Treasury today published its new list of countries that engage in an unsanctioned international boycott of a country friendly to the United States, specifically, the Arab boycott of Israel, as required pursuant to section 999 of the Internal Revenue Code of 1986. See 71 Fed. Reg. 38,688 (July 7, 2006). The Treasury Department is supposed to issue the list (and any revisions thereto) every calendar quarter, but the last time the list appeared was December 2004. For US taxpayers, this list identifies those countries for which a report on operations in such countries is required on IRS Form 5713 at the time of filing an annual tax return. The list also is a useful tool (although not dispositive) in determining where boycott-related requests are likely to arise.

The newly-issued list identifies Kuwait, Lebanon, Libya, Qatar, Saudi Arabia, Syria, the United Arab Emirates, and the Republic of Yemen as boycotting countries. Of note, the revised list does not include Oman or Bahrain, which appeared on the previous list. The notice indicates these countries were omitted due to actions by their governments, presumably their efforts to not participate in the Arab boycott of Israel. While Iraq is not listed, Treasury indicates its status remains under review.

If you have any questions regarding the U.S. anti-boycott regulations or the new list, please contact Stan Smilack at 202-429-6464 or Ed Krauland at 202-429-8083.