The OverRuled: Russia Trade Controls Resource Center has been updated with the following actions:
- 30 Mar 2023 (OFAC):
On March 30, 2023, OFAC issued an amended FAQ 1118, which relates to whether payment of a so-called “exit tax” prior to the divestment of assets located in the Russian Federation is prohibited by U.S. sanctions and, if so, whether such payments are authorized under GL 13D. In the new FAQ 1118, OFAC states that “[i]nformation currently available to OFAC suggests so-called ‘exit taxes’ imposed by the Government of the Russian Federation involve payments to” the Central Bank of the Russian Federation, the National Wealth Fund of the Russian Federation, or the Ministry of Finance of the Russian Federation (collectively, “Russia-related Directive 4 Entities”). Directive 4 under Executive Order 14024 prohibits U.S. persons from engaging in any transaction involving Russia-related Directive 4 Entities, including any transfer of assets to such entities or any foreign exchange transaction for or on behalf of such entities. Accordingly, OFAC concludes in the new FAQ 1118 that “U.S. persons whose divestment from the Russian Federation will involve the payment of such an exit tax require a license from OFAC prior to the payment of such tax, unless otherwise authorized by OFAC.” Previously, FAQ 1118 merely stated that payment of an “exit tax” may require a license from OFAC. In the new FAQ 1118, OFAC also clarified that U.S. person sellers do not need to seek authorization from OFAC for their Russian buyers to submit an application to the commission that the Russian government has established to review divestment transactions.
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