E9-13523. Sudanese Sanctions Regulations

AGENCY:

Office of Foreign Assets Control, Treasury.

ACTION:

Final rule.

SUMMARY:

The Office of Foreign Assets Control of the U.S. Department of the Treasury (“OFAC”) is amending the Sudanese Sanctions Regulations to expand the scope of an existing authorization of certain imports for diplomatic or official personnel to include the provision of goods or services in the United States to the diplomatic missions of the Government of Sudan to the United States and the United Nations, and to the employees of such missions, subject to certain conditions. The amended section also authorizes the importation of goods or services into the United States by the regional Government of Southern Sudan and its employees that involve the transit or transshipment of goods through areas of Sudan other than the Specified Areas of Sudan, subject to certain conditions.

DATES:

Effective Date: June 10, 2009.

FOR FURTHER INFORMATION CONTACT:

Assistant Director for Compliance Outreach & Implementation, tel.: [phone], Assistant Director for Licensing, tel.: [phone], Assistant Director for Policy, tel.: [phone], Office of Foreign Assets Control, or Chief Counsel (Foreign Assets Control), tel.: [phone], Office of the General Counsel, Department of the Treasury (not toll free numbers).

SUPPLEMENTARY INFORMATION:

Electronic and Facsimile Availability

This document and additional information concerning OFAC are available from OFAC's Web site (http://www.treas.gov/​ofac) or via facsimile through a 24-hour fax-on demand service, tel.: [phone].

Background

The Sudanese Sanctions Regulations, 31 CFR part 538 (the “SSR”), were promulgated to implement Executive Order 13067 of November 3, 1997 (“E.O. 13067”), in which the President declared a national emergency with respect to the policies and actions of the Government of Sudan. To deal with that emergency, E.O. 13067 imposed comprehensive trade sanctions with respect to Sudan and blocked all property and interests in property of the Government of Sudan in the United States or within the possession or control of United States persons. On October 13, 2006, the President issued Executive Order 13412 (“E.O. 13412”), to take additional steps with respect to the emergency declared in E.O. 13067, and to implement the Darfur Peace and Accountability Act of 2006 (Pub. L. 109-344, 120 Stat. 1869). While it exempted specified areas of Sudan from certain prohibitions in E.O. 13067, E.O. 13412 continued the blocking of the Government of Sudan's property and interests in property and imposed a country-wide prohibition on transactions relating to Sudan's petroleum or petrochemical industries. E.O. 13412 also removed the regional Government of Southern Sudan from the definition of the Government of Sudan. On October 31, 2007, the SSR were amended to implement E.O. 13412 (72 FR 61513, October 31, 2007).

Today, OFAC is amending section 538.515 of the SSR. Before its amendment, section 538.515 authorized all transactions ordinarily incident to the importation of any goods or services into the United States destined for official or personal use by the diplomatic missions of the Government of Sudan to the United States and to international organizations located in the United States, subject to certain conditions. OFAC is amending this section to expand the scope of the authorization to include the provision of goods or services in the United States to the diplomatic missions of the Government of Sudan to the United States and the United Nations, and to the employees of the diplomatic missions of the Government of Sudan to the United States and the United Nations, subject to certain conditions.

Paragraph (a) of the revised section 538.515 authorizes the importation of goods or services into the United States by, and the provision of goods or services in the United States to, the diplomatic missions of the Government of Sudan to the United States and the United Nations, subject to four conditions: (1) The goods or services must be for the conduct of the official business of the missions, or for personal use of the employees of the missions, and not for resale; (2) such transactions must not involve the purchase, sale, financing, or refinancing of real property; (3) such transactions are not otherwise prohibited by law; and (4) all such transactions must be conducted through an account at a U.S. financial institution specifically licensed by OFAC. A note to paragraph (a)(4) of the revised section 538.515 states that U.S. financial institutions are required to obtain specific licenses to operate accounts for, or extend credit to, the diplomatic missions of the Government of Sudan to the United States and the United Nations.

Paragraph (b) of the revised section 538.515 authorizes the importation of goods or services into the United States by, and the provision of goods or services in the United States to, the employees of the diplomatic missions of the Government of Sudan to the United States and the United Nations, subject to two conditions: (1) The goods or services must be for personal use of the employees of the missions, and not for resale; and (2) such transactions are not otherwise prohibited by law.

Paragraph (c) of the revised section 538.515 authorizes the importation of goods or services into the United States by the regional Government of Southern Sudan and its employees that involve the transit or transshipment of goods from the Specified Areas of Sudan through areas of Sudan other than the Specified Areas of Sudan, subject to two conditions: (1) The goods or services must be for the conduct of the business of the regional Government, or for personal use of the employees of the regional Government, and not for resale; and (2) such transactions are not otherwise prohibited by law. A note to paragraph (c) of revised section 538.515 explains that the authorization contained in this paragraph permits the regional Government of Southern Sudan and its employees to import into the United States goods or services that have transited or transshipped through areas of Sudan other than the Specified Areas of Sudan without the need to obtain a specific license under § 538.417. The importation of goods and services into the United States by the regional Government of Southern Sudan not involving the transit or transshipment through areas of Sudan other than the Specified Areas of Sudan is already exempt under §§ 538.212(g) and 538.305(b) and, therefore, requires no authorization. Similarly, the provision of goods and services in the United States to the regional Government of Southern Sudan and its employees already is exempt pursuant to §§ 538.212(g) and 538.305(b) and also requires no authorization.

Public Participation

Because the amendment of the SSR involves a foreign affairs function, the provisions of Executive Order 12866 and the Administrative Procedure Act (5 U.S.C. 553) requiring notice of proposed rulemaking, opportunity for public participation, and delay in effective date are inapplicable. Because no notice of proposed rulemaking is required for this rule, the Regulatory Flexibility Act (5 U.S.C. 601-612) does not apply.

Paperwork Reduction Act

The collections of information related to the SSR are contained in 31 CFR part 501 (the “Reporting, Procedures and Penalties Regulations”). Pursuant to the Paperwork Reduction Act of 1995 (44 U.S.C. 3507), those collections of information have been approved by the Office of Management and Budget under control number 1505-0164. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless the collection of information displays a valid control number.

List of Subjects in 31 CFR Part 538

• Administrative practice and procedure
• Banks
• Banking
• Blocking of assets
• Exports
• Foreign trade
• Humanitarian aid
• Imports
• Penalties
• Reporting and recordkeeping requirements
• Specially designated nationals
• Sudan
• Terrorism
• Transportation

For the reasons set forth in the preamble, the Office of Foreign Assets Control amends 31 CFR part 538 as follows:

PART 538—SUDANESE SANCTIONS REGULATIONS

1. The authority citation for part 538 continues to read as follows:

Authority: 3 U.S.C. 301; 18 U.S.C. 2339B, 2332d; 31 U.S.C. 321(b); 50 U.S.C. 1601-1651, 1701-1706; Pub. L. 101-410, 104 Stat. 890 (28 U.S.C. 2461 note); Pub. L. 106-387, 114 Stat. 1549; Pub. L. 109-344, 120 Stat. 1869; Pub. L. 110-96, 121 Stat. 1011; E.O. 13067, 62 FR 59989, 3 CFR, 1997 Comp., p. 230; E.O. 13412, 71 FR 61369, 3 CFR, 2006 Comp., p. 244.

Subpart E—Licenses, Authorizations, and Statements of Licensing Policy

2. Revise § 538.515 to read as follows:

§ 538.515

Sudanese diplomatic missions in the United States.

(a) The importation of goods or services into the United States by, and the provision of goods or services in the United States to, the diplomatic missions of the Government of Sudan to the United States and the United Nations are authorized, provided that:

(1) The goods or services are for the conduct of the official business of the missions, or for personal use of the employees of the missions, and are not for resale;

(2) The transaction does not involve the purchase, sale, financing, or refinancing of real property;

(3) The transaction is not otherwise prohibited by law; and

(4) The transaction is conducted through an account at a U.S. financial institution specifically licensed by OFAC.

Note to paragraph (a)(4) of § 538.515:

U.S. financial institutions are required to obtain specific licenses to operate accounts for, or extend credit to, the diplomatic missions of the Government of Sudan to the United States and the United Nations.

(b) The importation of goods or services into the United States by, and the provision of goods or services in the United States to, the employees of the diplomatic missions of the Government of Sudan to the United States and the United Nations are authorized, provided that:

(1) The goods or services are for personal use of the employees of the missions, and are not for resale; and

(2) The transaction is not otherwise prohibited by law.

(c) The importation of goods or services into the United States by the regional Government of Southern Sudan and its employees that involves the transit or transshipment of goods from the Specified Areas of Sudan through areas of Sudan other than the Specified Areas of Sudan is authorized, provided that:

(1) The goods or services are for the conduct of the business of the regional Government, or for personal use of the employees of the regional Government, and are not for resale; and

(2) The transaction is not otherwise prohibited by law.

Note to paragraph (c) of § 538.515:

The authorization contained in paragraph (c) of this section permits the regional Government of Southern Sudan and its employees to import into the United States goods or services that have transited or transshipped through areas of Sudan other than the Specified Areas of Sudan without the need to obtain a specific license under § 538.417. The importation of goods and services into the United States by the regional Government of Southern Sudan not involving transit or transshipment through areas of Sudan other than the Specified Areas of Sudan already is exempt pursuant to §§ 538.212(g) and 538.305(b) and, therefore, requires no authorization. Similarly, the provision of goods and services in the United States to the regional Government of Southern Sudan and its employees already is exempt pursuant to §§ 538.212(g) and 538.305(b) and also requires no authorization.

Dated: June 3, 2009.

Adam J. Szubin,

Director, Office of Foreign Assets Control.