International Law Advisory - OFAC Identifies 21 Entities Owned or Controlled by the Government of Iran

On August 3, 2010, the U.S. Department of the Treasury, Office of Foreign Assets Control (“OFAC”) identified 21 entities that it has determined to be owned or controlled by the Government of Iran.  These entries are located not only in Iran, but also in Belarus, Germany, Italy, Japan, and Luxembourg.  They operate in the banking, insurance and investment, mining, and engineering industries.  Based on the name and location of these entities, it would not necessarily be apparent that they are owned or controlled by the Government of Iran. Therefore, OFAC has identified them for the public and added them to the Specially Designated Nationals (“SDN”) list.

Under the Iranian Transactions Regulations, 31 C.F.R. Part 560, U.S. persons are prohibited from conducting business with the Government of Iran, including these and other entities that are owned or controlled by the Government of Iran. This is true even if Iranian-owned or controlled entities are not located in Iran, as is the case with many of these 21 entities.  This announcement does not change companies’ general compliance responsibilities.  U.S. persons should still screen all customers, vendors, and other foreign contacts against the SDN list and other U.S. Government restricted party lists. OFAC’s action makes clear, however, that sanctioned governments have global networks, and may even be expanding them to evade U.S. sanctions.  Since an entity’s ownership and control structure is not always readily apparent, U.S. persons must be vigilant in conducting foreign transactions and may need to perform additional due diligence if they have doubt or uncertainly regarding the selection of business partners.

If you have any questions about this announcement, please contact Edward Krauland at 202-429-8083, or Michael Gershberg at 202-429-6208.