New North Korea Sanctions Regulations Become Effective Today
The Office of Foreign Assets Control (OFAC)’s new North Korea Sanctions Regulations become effective today. In addition to making certain technical and conforming changes, the newly updated Part 510 incorporates recent changes to the sanctions program under Executive Orders (E.O.) 13687, 13722, and 13810, the North Korea Sanctions and Policy Enhancement Act of 2016, and the Countering America’s Adversaries Through Sanctions Act of 2017 (CAATSA). The new rules incorporate general licenses that were previously exclusively on OFAC’s website and make changes to those general licenses, including a new $5,000 cap on authorized remittances to North Korea and the elimination of the general license authorizing certain educational activities. OFAC also issued four new general licenses authorizing certain transactions relating to the investment and reinvestment of funds, payments of certain legal fees, and the activities of the U.S. government and international organizations. Although there have been some minor adjustments, sanctions on North Korea generally remain the same under the new Part 510. All property and interests in property of the Government of North Korea and the Workers’ Party of Korea are blocked, and U.S. persons are generally prohibited from engaging in transactions with them without authorization from OFAC and must block property or interests in property that are in, or come within, the United States or the possession of a U.S. person. All U.S. persons must comply with OFAC regulations, including all U.S. citizens and permanent resident aliens regardless of where they are located, all individuals and entities within the United States, and all U.S.-incorporated entities and their foreign branches. Each violation of the North Korea Sanctions Regulations is subject to a civil monetary penalty of up to the greater of the International Emergency Economic Powers Act (IEEPA) statutory maximum ($289,238 as of March 1, 2018) or twice the value of the underlying transaction. Criminal penalties of IEEPA can reach $1,000,000 and 20 years imprisonment per violation. For more information, check out OFAC’s updated North Korea FAQs or contact our sanctions team.