According to the Law on Sanctions, all persons are obliged to observe and fulfill the international (UN and EU) sanctions in effect in Latvia, and the national sanctions of the Republic of Latvia, while not everyone has a clear understanding of the sanctions imposed by the USA as a NATO member-state, i.e., the compliance with OFAC (Office of Foreign Assets Control) sanctions. In this article, we will introduce some clarity to this issue.
OFAC sanctions are specific restrictive measures that OFAC imposes on a specific country or other recipient (e.g., individuals accused of committing war crimes, criminals, and others).
• US persons and any person located in the US must comply with OFAC sanctions;
• OFAC sanctions are applicable to any transaction conducted in USD or involving any US person and, in certain programs, a foreign subsidiary owned or controlled by a US company or a foreign person in possession of US-made goods;
• OFAC sanctions must be followed in public procurement and financial transactions;
• OFAC sankcijas ir jāievēro, ja persona ir iekļauta vai ir saistīta ar personu, kas iekļauta teroristu sarakstos (piemēram, Programm Tag [SDGT] – Global Terrorism Sanction Regulations, kā arī [FTO] – Foreign Terrorist Organizations, [HIFPAA] – Hizballah International Financing Prevention Amendments Act of 2018, [NPWMD] – Non-Proliferation of Weapons of Mass Destruction).
• Exceptions possible when OFAC sanctions are applied if a Specific License from OFAC has been received or based on a General License issued by OFAC.
Despite the fact that other US sanction restrictions are not formally legally binding, it should be taken into account that the imposed sanctions can significantly affect the commercial activities of Latvian companies. US institutions often rely on the application of extraterritorial national requirements, and entrepreneurs should be aware of that.
It should also be noted that non-compliance with sanctions may result in criminal liability. Supervisory institutions can also impose administrative penalties, including significant monetary fines.
Atbilst team
