On February 6, 2023, two massive earthquakes of 7.8 and 7.6 magnitude struck Turkey and Syria, resulting in substantial physical damage and tremendous loss of life with over 40,000 deaths as of February 14, 2023.  Non-governmental organizations, the United Nations, and other non-profits have mobilized efforts to assist in disaster recovery efforts.  As the search for survivors continues the United Nations Secretary-General, Antonio Guterres, announced that “delivering food, health, nutrition, protection, shelter, winter supplies and other life-saving supplies to all the millions of people affected is of the utmost urgency.” 

While Turkey is not subject to any U.S. sanctions programs, the disaster area includes Syria which presents challenges for humanitarian aid in light of substantial U.S. and Western sanctions on Syria.  Generally speaking, U.S. sanctions on Syria broadly prohibit dealings involving persons located in Syria, including financial transactions, except in narrow circumstances.

OFAC Response

To address concerns of U.S. sanctions potentially impeding humanitarian aid to victims located in Syria, the U.S. Department of Treasury’s (Treasury) Office of Foreign Assets Control (OFAC) issued General License 23 (“GL 23”) to the Syrian Sanctions Regulations (“SySR”), on February 9, 2023.  GL 23 authorizes U.S. persons, including banks in the United States, to process or transfer of funds by “third-country persons” – persons located outside of Syria – “to or from Syria in support of” “transactions related to earthquake relief efforts in Syria that would otherwise be prohibited by the SySR,” for a period of 180 days, through 12:01 PM EST on August 8, 2023.  See GL 23 at para. (a) and n.1 to para. (a).  Notably, U.S. financial institutions and U.S. registered money transmitters may rely on the “originator of a funds transfer with regard to compliance with” paragraph (a) of GL 23 “provided that the financial institution does not know or have reason to know that the funds transfer is not in compliance with” paragraph (a) of GL 23.  Id. at n.1 to para. (a).  In announcing GL 23, Treasury stated that this latest general license builds upon existing humanitarian authorizations in the SySR and “provides the broad authorization necessary to support immediate disaster relief efforts in Syria.”

GL 23 contains a few limitations.  Specifically, it does not authorize transactions involving persons designated under any sanctions authority, including the SySR, other than persons or entities “who meet the definition of the term Government of Syria, as defined in section 542.305(a) of the SySR.” Id. at para. (b).  It also does not authorize transactions relating to the import of Syrian origin petroleum or petroleum products into the United States, as prohibited by 31 C.F.R. § 542.208. 

While a welcome step from OFAC, GL 23, by its text, is limited to financial transactions and does not authorize separately authorize the export of goods to Syria in support of humanitarian aid, unless otherwise authorized.  The Commerce Department’s Bureau of Industry and Security (BIS) prohibits the export or reexport of all items subject to the Export Administration Regulations (EAR) to Syria, absent a BIS license, other than food or medicine designated as EAR99, as provided for in Section 746.9 of the EAR.  BIS has not issued a general blanket license exception or license, but has stated that it is prioritizing (~3-5 days) specific license applications for export of Items subject to the EAR for earthquake relief.

On February 21, OFAC went further and published a guidance document for the humanitarian community, seeking to proactively address a series of questions regarding how the general public can provide assistance related to earthquake relief to Syria.  Helpfully, the guidance document is drafted to offer “Yes,” “No,” or “It Depends” answers to a series of proposed support activities.

OFSI Response

Similarly, the United Kingdom’s Office of Financial Sanctions Implementation (OFSI) issued General Licence INT/2023/2711256 (the “OFSI Syria GL”) on February 15, 2023 (amended on February 17, 2023) to aid in humanitarian relief for Syria.  The OFSI Syria GL expires on August 15, 2023, at 11:59 PM GMT.

The OFSI Syria GL authorizes:

(1) “Relevant Persons,” which are (a) the UN and its programs and specialized agencies; (b) international organizations carrying out relief activities in Syria; (c) “humanitarian organisations having observer status with the United Nations General Assembly and members of those humanitarian organisations” (d) “bilaterally or multilaterally funded non-governmental organisations participating in the United Nations Humanitarian Response Plans, Refugee Response Plans, other United Nations appeals, or humanitarian clusters coordinated by the United Nations Office for the Coordination of Humanitarian Affairs”; and employees or grantees of the foregoing organizations acting in those capacities;

(2) to engage “Relevant Activities,” which include activities relating to humanitarian assistance for earthquake relief in Turkey and Syria, including “the provision, processing and payment of funds, or economic resources, and the provision of goods and services necessary to ensure the timely delivery of such assistance or to support such activities.”

OFSI Syria GL at paras. 3-4.

The OFSI Syria GL does not allow any funds used in support of Relevant Activities to come from funds or economic resources owned, held or controlled by a UK Designated Person, (1) “except where a Designated Person has received funds, goods or services in exchange for those economic resources from a Relevant Person to perform Relevant Activities” or (2) “funds that are controlled by a Designated Financial Institution in the event that those funds are not owned, held or controlled by any other Designated Person or where the transfer of funds is otherwise licensed.”  OFSI Syria GL at paras. 5-7.  “Designated Financial Institution” includes eight listed Syrian financial institutions.  

“Relevant Institutions,” as defined in the OFSI Syria GL and which includes certain UK financial institutions, are authorized to carry out activities to effectuate the Relevant Activities, subject to the limitations set forth in the OFSI Syria GL.  Id. at para. 8.

Conclusion

Taken together, the actions by OFSI and OFAC provide some well-needed clarity for humanitarian financial aid for the people of Syria impacted by the recent devastating earthquakes. Crowell & Moring LLP is actively advising NGOs and private sector actors on relief efforts. 

For questions about the scope of permissible activities involving Syria under U.S. law, you may reach out to:  Anand Sithian, Clif Burns, Jana Del-Cerro, Jeff Snyder, or Nicole Succar.   For questions about UK or EU law permissible activities, please contact Michelle Linderman

We will continue to monitor developments and provide updates as appropriate. 

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Photo of Dj Wolff Dj Wolff

David (Dj) Wolff is the co-chair of Crowell & Moring’s International Trade Group and a director with C&M International, the firm’s trade policy affiliate.

At Crowell & Moring, he serves on the steering committee for the International Trade Group, where his practice focuses

David (Dj) Wolff is the co-chair of Crowell & Moring’s International Trade Group and a director with C&M International, the firm’s trade policy affiliate.

At Crowell & Moring, he serves on the steering committee for the International Trade Group, where his practice focuses on all aspects of compliance with U.S. economic sanctions, including day-to-day compliance guidance, developing compliance programs, responding to government inquiries, conducting internal investigations, and representation during civil and criminal enforcement proceedings. Dj works regularly with non-U.S. clients, both in Europe and Asia, to evaluate the jurisdictional reach of U.S. sanction authorities to their global operations, identify and manage the potential conflict of laws that can result from that reach, as well as to support client’s design, implementation, and evaluation of a corresponding risk-based sanctions compliance program. Dj also regularly leads teams in diligence efforts on trade and related regulatory areas on behalf of his U.S. and non-U.S. clients in the M&A arena, having successfully closed more than 30 deals with an aggregate valuation of several billion dollars over the last 18 months.

Dj is ranked by Chambers USA in International Trade: Export Controls & Economic Sanctions. He has previously been recognized by Law360 as a Rising Star in International Trade (2020), by The National Law Journal as a “DC Rising Star” (2019), by Who’s Who Legal: Investigations as a “Future Leader” (2018 and 2019), Acritas Star as an Acritas Stars Independently Rated Lawyers (2019), by Global Investigations Review as one of the “40 under 40” in Investigations internationally (2017), and WorldECR as one of the five finalists for the WorldECR Young Practitioner of the Year award (2016).

Photo of Anand Sithian Anand Sithian

For high-stakes internal and government investigations and complex regulatory and compliance matters, companies and individuals look to Anand to provide strategic advice and counseling, particularly on issues relating to the Bank Secrecy Act and Anti-Money Laundering (“BSA/AML”), economic sanctions, and digital assets. Anand

For high-stakes internal and government investigations and complex regulatory and compliance matters, companies and individuals look to Anand to provide strategic advice and counseling, particularly on issues relating to the Bank Secrecy Act and Anti-Money Laundering (“BSA/AML”), economic sanctions, and digital assets. Anand is resident in the firm’s New York office and a member of the firm’s International Trade, White Collar and Regulatory Enforcement, and Financial Services groups.

A former federal prosecutor, Anand leverages his government experience to guide clients through complex white-collar matters, including grand jury and regulatory investigations, enforcement proceedings, and internal investigations. Anand has deep experience in parallel criminal and civil investigations and proceedings, and often represents clients in defending against civil lawsuits related to government investigations.

Representing some of the world’s largest banks and technology companies, Anand has addressed a wide range of issues, including economic sanctions, BSA/AML; economic sanctions and national security; payments and cryptocurrency; securities laws; and cybersecurity enforcement. In the regulatory space, Anand prides himself on providing commercial and actionable advice, including in the developing areas of digital assets, FinTech, and payments.

Photo of Dmitry Bergoltsev Dmitry Bergoltsev

Dmitry Bergoltsev is a senior international trade analyst in Crowell & Moring’s Washington, D.C. office. He provides practice support to the International Trade Group on import regulatory matters pending before the Office of the U.S. Trade Representative (USTR) and U.S. Customs and Border

Dmitry Bergoltsev is a senior international trade analyst in Crowell & Moring’s Washington, D.C. office. He provides practice support to the International Trade Group on import regulatory matters pending before the Office of the U.S. Trade Representative (USTR) and U.S. Customs and Border Protection (CBP). He works closely with attorneys developing courses of action for clients impacted by investigations under Section 301 of the Trade Act of 1974 and Section 232 of the Trade Expansion Act of 1962. He also supports unfair trade investigations, including antidumping (AD) and countervailing duty (CVD) investigations, sunset reviews, and changed circumstance reviews before the Department of Commerce and the International Trade Commission (ITC).