Since President Clinton’s Executive Order (“E.O.”) N°13067 of November, 3, 1997, (“EO Clinton 1997”), the U.S inflicted a commercial embargo and an asset freeze on the Sudanese government and part of its territory. Any Sudanese government’s properties and interests located within the U.S or placed under the control of a U.S national were frozen. This freezing also included assets of individuals acting on behalf or in the name of the government of Sudan, and those of entities held or controlled by it, wherever located.
At the time, the indirect implication of a U.S national in the buyout of a Sudanese company’s shares or assets could have fallen within the scope of the regulation, since any properties and interests of the Sudanese government transiting through U.S territory or entering into a U.S national’s possession were blocked. The perpetrator of an offence under this regulation was exposed to a criminal penalty of up to $1.000.000 and 20 years of imprisonment. In addition, an administrative penalty of up to $250.000 or twice the amount of the litigious transaction could have been inflicted.
On January, 13, 2017, President Obama’s EO N° 13761 (“EO Obama 2017”) partially abrogated “EO Clinton 1997” (Sections 1 and 2) and entirely repealed President Bush’s EO N° 13412 (“EO Bush 2006”) effective July, 12, 2017 – subject to the publication of a report from the Secretary of State noting that the conditions for the lifting of sanctions were still met as of that date. Since President Trump’s EO N° 13804 extended the review period, the revocation of U.S commercial and financial sanctions against Sudan was not officially effective until October, 12, 2017, following the publication of the Secretary of State’s report in the Federal Register. The Code of Federal Regulations (“CFR”) was officially amended in accordance on June, 28, 2018.
The softening of the regulation in October 2017 did not lead to a general authorization of all business relationships with Sudanese persons.
On one hand, U.S nationals are still forbidden to conduct any business with persons mentioned in the Office of Foreign Assets Control (“OFAC)’s list of Sudanese Specially Designated Nationals (“SDNs”) identified with respect to the regulation concerning South Sudan and terrorism-related activities1. In sum, only relationships with SDNs identified under the tag [SUDAN] are free. Furthermore, the OFAC’s approval is required where the litigious transaction is affected by specific prohibitions related to Darfur2 ou and South Sudan3 .
On the other hand, U.S and foreign nationals must still obtain a license from the Bureau of Industry and Safety (Department of Commerce) in order to export or re-export certain products, technologies and software to Sudan, which are mentioned in the Commerce Control List« CCL »)4. However, the CCL is not restrictive, and a preliminary approval can be required – for U.S as well as foreign nationals – even for products that do not appear on the list where certain users or final uses are concerned5.
1 Global Terrorism Sanctions Regulations, 31 CFR, §594.
2 31 CFR, § 546.
3 31 CFR, § 558.
4 https://www.bis.doc.gov/index.php/documents/regulations-docs/2336-ccl5-pt1-10-24-18/file
5 15 CFR, § 774.
