President Biden Issues Executive Order on Ensuring Robust Consideration of Evolving National Security Risks by the Committee on Foreign Investment in the United States

Abstract

rule, OFAC “amend[ed] its regulations inmultiple sanctions programs to add, amend, or update general licenses authorizing official business of the United States government and official business of certain international organizations and entities.”35 For NGOs and IOs, the licenses generally do “not authorize funds transfers initiated or processed with knowledge or reason to know that the intended beneficiary of such transfers is a person blocked.”36 To the extent that a general license does not apply, specific licenses may be issued. The two rules go beyond Resolution 2664’s provisions to cover many U.S. sanctions programs that operate outside of the Security Council framework.37 The general licenses established by the new rules are similar to the humanitarian licenses OFAC previously established for specific sanctions programs, such as those for Crimea and Venezuela.38 The new rules apply only to OFAC sanctions and have no effect on those administered by other agencies, such as the Department of Commerce. NGOs welcomed the new rules. Kate Phillips-Barrasso, vice president of Global Policy and Advocacy forMercyCorps, said, “It literally almost feels surreal to me, as an advocate who’s been working on this for the better part of a decade. I keep having to almost pinch myself. It is a lifeand-death issue in some cases and they have been told about the problem for years and they took amajor step forward in trying to resolve it.”39 Though the new general licenses provide reason for optimism, financial institutions will need to move away from their inclination toward sanctions “overcompliance” for the humanitarian carveout to have meaningful effect.40