OFAC sanctions Syrian regime’s financial facilitators & oil procurement network

US Treasury Building2OFAC has sanctioned 4 individuals and 5 entities, pursuant to Executive Order 13582, for “facilitat[ing] financial transactions and shipments of fuel and weapons to the Syrian regime” (asset freezes imposed). See OFAC Notice and Treasury press release.

The individuals are: Yasir ‘Abbas; Adnan Al-Ali; Muhammad Al-Qatirji; and Fadi Nabih Nasser. The entities are: Abar Petroleum Service SAL; Al-Qatirji Company; International Pipeline Construction FZE; Nasco Polymers & Chemicals Co SAL (Off-Shore); and Sonex Investments Ltd.

Jordan Insurance v AIG litigation – do US sanctions prevent reinsurance payouts?

AIG.jpgAIG Europe Ltd has argued in the Commercial Court in London that it cannot pay 414,000 Jordanian Dinars (US $584,000) in reinsurance cover to the Jordan Insurance Company for money said to have been stolen in 2013 from a Syrian bank (International Bank for Trade and Finance Ltd), because that payment would breach US sanctions on Syria.

AIG argues that the payment would be a prohibited transaction because it would have to involve US-based banks (the reinsurance contracts stipulate for claims and premiums to be paid in US dollars), constituting the supply of services from the US to Syria, or the receipt in Syria of the benefit of such services. Judgment awaited.

USA & France coordinate sanctions on global procurement network for Syria’s chemical weapons programme

syria flag.jpgYesterday, OFAC designated 8 individuals and 5 entities, pursuant to Executive Order 13382 (imposes asset freezes), for being “key components of a vast network procuring electronics on behalf of Syria’s Scientific Studies and Research Center (SSRC), the agency responsible for the development of Syria’s chemical weapons”. In a coordinated action, the French government also renewed asset freezes on 24 entities and individuals from the same procurement network for “providing an array of support to the SSRC”. See OFAC Notice and US Treasury press release.

EU removes Bassam Sabbagh from Syria sanctions list

EU3In May 2018, the EU updated and extended its Syria sanctions until 1 June 2019 by adopting Council Decision (CFSP) 2018/778 and Council Implementing Regulation (EU) 2018/774 (see previous blog).

Today, the EU has corrected both of those legal acts by removing the individual named ‘Bassam Sabbagh’ from its Syria sanction list (no longer subject to an asset freeze). See Corrigendum to the Council Decision and Corrigendum to the Council Implementing Regulation.

Cement company Lafarge SA formally placed under French investigation over subsidiary’s Syrian payments

Lafarge.jpgYesterday, Franco-Swiss cement company LafargeHolcim announced that the examining magistrates in Paris have placed the company’s French component, Lafarge SA, under investigation in relation to payments allegedly made between 2011 and 2014 to sanctioned militant groups, including ISIS, to ensure that its Jalabiya cement plant in Syria continued to operate (the plant had been operated by Lafarge Cement Syria, a subsidiary of Lafarge SA).

In the announcement, Lafarge SA admits that the “system of supervision of its Syrian subsidiary did not allow the company to identify wrongdoings”, but added that the company would “appeal against those charges which do not fairly represent the responsibilities of Lafarge SA”.

EU Court upholds re-listings of Syrian businessman; HX v Council

CJEU1We previously reported that the EU General Court annulled the original designation of HX (court had granted him anonymity), who had been subject to restrictive measures under the EU’s Syria sanctions for supporting and benefitting from the regime as a prominent businessman in the oil and gas sector – he denied that he supported or benefitted from the regime.

The Court has now upheld his 2016 and 2017 re-listings, see judgment: HX v Council T-408/16 (19 June 2018). HX was relisted for being an “influential businessman operating in Syria” who supported or benefitted from the Syrian regime, and for being a member of the Syrian Parliament. The Court rejected HX’s argument that the Council had breached its obligation to state reasons by equating being an influential businessman in Syria with support or benefit from the Syrian regime. The new listing criteria meant that being an “influential businessman operating in Syria” was sufficient.

Rami Makhlouf unsuccessful in EU Syria sanctions appeal

CJEU1The Court of Justice of the EU has dismissed Rami Makhlouf’s appeal against the General Court’s judgment which had dismissed his application to annul his EU Syria sanctions listing, finding no errors in the judgment below. Link to blog on lower court judgment here and appeal judgment here.

5 Russians and 3 Syrians indicted for conspiracy to violate US sanctions on Syria and Crimea/Ukraine

US Department of State.jpgThe US Department of Justice has announced that 8 businessmen – 5 Russian nationals and 3 Syrian nationals – have been indicted on federal charges for conspiracy to violate US sanctions against Syria and Crimea/Ukraine; namely, by sending jet fuel to Syria and making US dollar wires to Syria and to sanctioned entities (in the absence of a US licence).

The indictment involves transactions conducted by Joint Stock Company Sovfracht (Sovfracht), a Russian shipping company and freight forwarder, which was designated by OFAC in September 2016 for Crimean sanctions violations. The 5 Russian nationals – Ivan Okorokov, Ilya Loginov, Karen Stepanyan, Alexey Konkov and Liudmila Shmelkova – are employees of Sovfracht. Yaser Naser is a Syrian national who worked on behalf of Sovfracht in Syria to coordinate its business there. Farid Bitar and Gabriel Bitar are petroleum inspectors at Port Banias, Syria.