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. 

Print:
Email this postTweet this postLike this postShare this post on LinkedIn
Photo of Anand Sithian Anand Sithian

Anand Sithian is a counsel in Crowell & Moring’s New York office. He is a member of the International Trade and the White Collar & Regulatory Enforcement groups. Anand advises clients on a variety of regulatory issues and investigations relating to anti-money laundering…

Anand Sithian is a counsel in Crowell & Moring’s New York office. He is a member of the International Trade and the White Collar & Regulatory Enforcement groups. Anand advises clients on a variety of regulatory issues and investigations relating to anti-money laundering (AML), the Bank Secrecy Act (BSA), U.S. economic sanctions, including those administered by the Office of Foreign Assets Control (OFAC), and asset forfeiture matters. Anand routinely counsels clients on the novel application of these laws and regulations to issues involving financial institutions, technology and social media, virtual currency and digital assets (including the seizure and forfeiture of virtual currencies), and the evolving cannabis industry.

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).