International Law Advisory - Department of Treasury Issues New Syria Sanctions Regulations (Revised)

The Department of Treasury, Office of Foreign Assets Control (“OFAC”) issued a new set of regulations today to facilitate the blocking of assets of certain Syrian nationals.  The regulations were published in this morning’s Federal Register (see 70 Fed. Reg. 17,201) and are effective as of March 31, 2005 (the date they were delivered for public inspection to the National Archives).1

The regulations are intended to implement, in part, Presidential Executive Order 13338 (May 11, 2004), in which the President imposed a wide-ranging set of economic sanctions against Syria.  Among other measures, the Order empowers the Treasury Department to identify and block the assets of persons deemed by Treasury, in consultation with the State Department, to be supporting or contributing to Syria's provision of safe haven to international terrorists, its occupation of Lebanon, its pursuit of weapons of mass destruction, or its efforts to undermine U.S. and international activities with respect to the stabilization and reconstruction of Iraq.

The new regulations will be codified in the Code of Federal Regulations at 31 C.F.R. Part 542.  The regulations, which are similar to those of other OFAC-administered property-blocking regimes, freeze assets in the United States or in the control of U.S. persons abroad (including overseas affiliates of U.S. companies) in which designated persons have an "interest".  They also prohibit U.S. persons from dealing with designated persons without prior approval from OFAC, including providing goods or services to such persons.  The restrictions are subject to exemptions typical in other OFAC embargo regimes, including for personal communications, informational materials, and certain legal services.

The regulations do not themselves designate any specific individuals or entities.  Rather, names of "designated persons" will be incorporated into OFAC's specially-designated nationals (SDN) list on an ongoing basis.

OFAC's notice includes a provision inviting public comment on the new regulations.  Comments may be submitted to OFAC by letter, fax, or e-mail, including through OFAC’s website.  All comments submitted to OFAC will be included in the public record (which will be available for public review, according to the regulation, on July 5, 2005).  Comments submitted with requests for confidential treatment will be returned by OFAC without review.

If you have any questions regarding the new regulations, please contact Ed Krauland at 202-429-8083 or David Lorello at 202-429-6757.

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1 The regulations are available for download here.