Burmese Sanctions Regulations, 37105-37121 [2014-14841]
Download as PDF
Vol. 79
Monday,
No. 125
June 30, 2014
Part IV
Department of the Treasury
mstockstill on DSK4VPTVN1PROD with RULES3
Office of Foreign Assets Control
31 CFR Part 537
Burmese Sanctions Regulations; Final Rule
VerDate Mar<15>2010
20:32 Jun 27, 2014
Jkt 232001
PO 00000
Frm 00001
Fmt 4717
Sfmt 4717
E:\FR\FM\30JNR3.SGM
30JNR3
37106
Federal Register / Vol. 79, No. 125 / Monday, June 30, 2014 / Rules and Regulations
DEPARTMENT OF THE TREASURY
Office of Foreign Assets Control
31 CFR Part 537
Burmese Sanctions Regulations
Office of Foreign Assets
Control, Treasury.
ACTION: Final rule.
AGENCY:
The Department of the
Treasury’s Office of Foreign Assets
Control (OFAC) is amending and
reissuing in their entirety the Burmese
Sanctions Regulations to implement
Executive Order 13448 of October 18,
2007, ‘‘Blocking Property and
Prohibiting Certain Transactions Related
to Burma,’’ Executive Order 13464 of
April 30, 2008, ‘‘Blocking Property and
Prohibiting Certain Transactions Related
to Burma,’’ Executive Order 13619 of
July 11, 2012, ‘‘Blocking Property of
Persons Threatening the Peace, Security,
or Stability of Burma,’’ and Executive
Order 13651 of August 6, 2013,
‘‘Prohibiting Certain Imports of Burmese
Jadeite and Rubies.’’
DATES: Effective: June 30, 2014.
FOR FURTHER INFORMATION CONTACT:
Assistant Director for Licensing, tel.:
202–622–2480, Assistant Director for
Policy, tel.: 202–622–2746, Assistant
Director for Regulatory Affairs, tel.: 202–
622–4855, Assistant Director for
Sanctions Compliance & Evaluation,
tel.: 202–622–2490, Office of Foreign
Assets Control, or Chief Counsel
(Foreign Assets Control), tel.: 202–622–
2410, Office of the General Counsel,
Department of the Treasury (not toll free
numbers).
SUPPLEMENTARY INFORMATION:
SUMMARY:
mstockstill on DSK4VPTVN1PROD with RULES3
Electronic and Facsimile Availability
This document and additional
information concerning OFAC are
available from OFAC’s Web site (www.
treasury.gov/ofac). Certain general
information pertaining to OFAC’s
sanctions programs also is available via
facsimile through a 24-hour fax-ondemand service, tel.: 202–622–0077.
Background
On May 20, 1997, the President issued
Executive Order 13047 (62 FR 28301,
May 22, 1997) (E.O. 13047), determining
that the Government of Burma, then
ruled by a military junta, had committed
large-scale repression of the democratic
opposition in Burma and declaring a
national emergency to deal with the
unusual and extraordinary threat posed
by the actions and policies of that
government. E.O. 13047, issued under
the authority of, inter alia, section 570
VerDate Mar<15>2010
20:32 Jun 27, 2014
Jkt 232001
of the Foreign Operations, Export
Financing, and Related Programs
Appropriations Act, 1997 (Pub. L. 104–
208) (section 570), and the International
Emergency Economic Powers Act (50
U.S.C. 1701–1706) (IEEPA), prohibits
new investment in Burma by a U.S.
person and any facilitation by a U.S.
person of new investment in Burma by
a foreign person. Section 570 provides
the President with the authority to
waive the new investment prohibition
in that section in the national security
interests of the United States.
On July 28, 2003, the President signed
into law the Burmese Freedom and
Democracy Act of 2003 (Pub. L. 108–61)
(BFDA) to further sanction the military
junta then ruling Burma. The BFDA
required the imposition, subject to
annual renewal, of a ban on the
importation into the United States of
any article that is a product of Burma.
To implement the BFDA and to take
additional steps with respect to the
national emergency declared in E.O.
13047, the President issued Executive
Order 13310 (68 FR 44853, July 30,
2003) (E.O. 13310), also on July 28,
2003. E.O. 13310 blocks, with certain
exceptions, all property and interests in
property of the persons listed in its
Annex and persons determined by the
Secretary of the Treasury, in
consultation with the Secretary of State,
to meet the criteria set forth in E.O.
13310. E.O. 13310 also prohibits the
exportation or reexportation to Burma of
financial services from the United States
or by a U.S. person, except as exempted,
licensed, or authorized. While E.O.
13310 also prohibited the importation
into the United States of any article that
is a product of Burma, that prohibition
has been revoked, as discussed in more
detail below.
On October 18, 2007, the President
issued Executive Order 13448 (72 FR
60223, October 23, 2007) (E.O. 13448),
expanding the scope of the national
emergency declared in E.O. 13047 and
blocking, with certain exceptions, all
property and interests in property of the
persons listed in the Annex to E.O.
13448 and persons determined by the
Secretary of the Treasury, after
consultation with the Secretary of State,
to meet the criteria set forth in E.O.
13448.
In order to take additional steps with
respect to the national emergency
declared in E.O. 13047 and expanded in
E.O. 13448, the President issued
Executive Order 13464 (73 FR 24491,
May 2, 2008) (E.O. 13464) on April 30,
2008. E.O. 13464 blocks all property and
interests in property of the persons
listed in its Annex and persons
determined by the Secretary of the
PO 00000
Frm 00002
Fmt 4701
Sfmt 4700
Treasury, after consultation with the
Secretary of State, to meet the criteria
set forth in E.O. 13464.
On July 29, 2008, the President signed
into law the Tom Lantos Block Burmese
JADE (Junta’s Anti-Democratic Efforts)
Act of 2008 (Pub. L. 110–286) (JADE
Act), which, among other things,
imposes mandatory blocking and
financial sanctions on certain categories
of persons described in the JADE Act.
The JADE Act also amended the BFDA
to require a prohibition on the
importation into the United States of
jadeite or rubies mined or extracted
from Burma and articles of jewelry
containing such jadeite or rubies and
the imposition of certain conditions on
the importation into the United States of
jadeite or rubies mined or extracted
from a country other than Burma and
articles of jewelry containing such
jadeite or rubies. The importation
provisions of the BFDA, as amended by
the JADE Act, required annual renewal,
which did not occur in 2013.
On July 11, 2012, the President issued
Executive Order 13619 (77 FR 41243,
July 13, 2012) (E.O. 13619), modifying
the scope of the national emergency
declared in E.O. 13047 and blocking all
property and interests in property of
persons determined by the Secretary of
the Treasury, in consultation with or at
the recommendation of the Secretary of
State, to meet the criteria set forth in
E.O. 13619.
Also on July 11, 2012, in response to
historic reforms in Burma, the U.S.
Government took a number of steps to
authorize new U.S. investment in
Burma and the exportation or
reexportation of U.S. financial services
to Burma. OFAC issued and made
available on its Web site a general
license authorizing the exportation or
reexportation of financial services to
Burma from the United States or by a
U.S. person, subject to certain
limitations. The Department of State,
pursuant to a delegation of authority
from the President, waived the ban on
new U.S. investment in Burma set forth
in section 570. Consistent with this
waiver, OFAC issued and made
available on its Web site a general
license authorizing new investment in
Burma, subject to certain limitations
and requirements.
The Department of State, pursuant to
a delegation of authority from the
President, subsequently waived the
importation prohibitions set forth in
section 3(a) of the BFDA. Consistent
with this waiver, on November 16, 2012,
OFAC issued and made available on its
Web site a general license authorizing
the importation into the United States of
any article that is a product of Burma,
E:\FR\FM\30JNR3.SGM
30JNR3
mstockstill on DSK4VPTVN1PROD with RULES3
Federal Register / Vol. 79, No. 125 / Monday, June 30, 2014 / Rules and Regulations
subject to certain limitations. This
general license did not authorize the
importation into the United States of
jadeite and rubies and of articles of
jewelry containing them, which
continued to be prohibited.
On February 22, 2013, OFAC issued
and made available on its Web site a
general license authorizing U.S. persons
to conduct most transactions, including
opening and maintaining accounts and
conducting other financial services
involving four of Burma’s major
financial institutions included on
OFAC’s Specially Designated Nationals
and Blocked Persons List (SDN List):
Asia Green Development Bank,
Ayeyarwady Bank, Myanma Economic
Bank, and Myanma Investment and
Commercial Bank.
On August 6, 2013, in light of the
expiration of the BFDA importation ban,
as amended by the JADE Act, the
President issued Executive Order 13651
(78 FR 48793, August 9, 2013) (E.O.
13651) revoking the provisions of E.O.
13310 implementing the broad ban on
importation of products of Burma.
However, due to continuing concerns,
including with respect to labor and
human rights in specific sectors, E.O.
13651 reinstates the prohibition that
was originally imposed by the JADE Act
amendments to the BFDA on the
importation into the United States of
any jadeite or rubies mined or extracted
from Burma and any articles of jewelry
containing jadeite or rubies mined or
extracted from Burma. Also in E.O.
13651, the President, pursuant to
Section 5(i) of the JADE Act, waived the
blocking and financial sanctions
provisions of Section 5(b) of the JADE
Act. Except as authorized by or exempt
from the Burmese Sanctions
Regulations, 31 CFR part 537 (the
‘‘Regulations’’), transactions involving
persons whose property and interests in
property are blocked pursuant to E.O.
13310, E.O. 13448, E.O. 13464, or E.O.
13619 continue to be prohibited
pursuant to the Regulations.
The Regulations, originally issued in
1998 to implement E.O. 13047, were
amended and reissued in their entirety
in 2005 to implement E.O. 13310. OFAC
now is further amending the
Regulations to implement E.O. 13448,
E.O. 13464, E.O. 13619, and E.O. 13651.
Due to the extensive nature of these
amendments, OFAC is again reissuing
the Regulations in their entirety.
Subpart A of the Regulations clarifies
the relation of this part to other laws
and regulations. Subpart B of the
Regulations implements the
prohibitions contained in E.O. 13047,
E.O. 13310, E.O. 13448, E.O. 13464, E.O.
13619, and E.O. 13651. Section
VerDate Mar<15>2010
20:32 Jun 27, 2014
Jkt 232001
537.201(a)(1) blocks, with certain
exceptions, all property and interests in
property that are in the United States,
that come within the United States, or
that are or come within the possession
or control of any United States person,
including any foreign branch, of: (1)
Any person listed in the Annexes to
E.O. 13310, E.O. 13448, or E.O. 13464;
and (2) any person determined by the
Secretary of the Treasury, in
consultation with the Secretary of State,
to meet the criteria set forth in any of
those Executive orders. Section
537.201(a)(2) blocks, with certain
exceptions, all property and interests in
property of any person determined by
the Secretary of the Treasury, in
consultation with or at the
recommendation of the Secretary of
State, to meet the criteria set forth in
E.O. 13619. Persons listed in the
Annexes to E.O. 13310, E.O. 13448, or
E.O. 13464, designated by or under the
authority of the Secretary of the
Treasury pursuant to E.O. 13310, E.O.
13448, E.O. 13464, or E.O. 13619, or
otherwise subject to the blocking
provisions of these authorities are
referred to throughout the Regulations
as ‘‘persons whose property and
interests in property are blocked
pursuant to § 537.201(a).’’ The names of
persons listed in the Annexes to E.O.
13310, E.O. 13448, or E.O. 13464 or
designated pursuant to E.O. 13310, E.O.
13448, E.O. 13464, or E.O. 13619 are
published on the SDN List, which is
accessible through the following page
on OFAC’s Web site: www.treasury.gov/
sdn.
Section 537.202 of subpart B prohibits
the exportation or reexportation of
financial services to Burma from the
United States or by a U.S. person,
wherever located. Note, however, that
new section 537.529 contains a general
license authorizing the exportation or
reexportation of financial services to
Burma, subject to certain limitations.
Section 537.203 of subpart B prohibits
the importation into the United States of
any jadeite or rubies mined or extracted
from Burma and any articles of jewelry
containing jadeite or rubies mined or
extracted from Burma.
Section 537.204 of subpart B prohibits
new investment in Burma. Note,
however, that new section 537.530
contains a general license authorizing
new investment in Burma by U.S.
persons, subject to certain limitations
and requirements.
Section 537.205 of subpart B prohibits
any approval, financing, facilitation, or
guarantee by a U.S. person, wherever
located, of a foreign person’s transaction
where the transaction would be
prohibited by section 537.202 or
PO 00000
Frm 00003
Fmt 4701
Sfmt 4700
37107
537.204 of this part if performed by a
U.S. person or within the United States.
Section 537.206 prohibits any
transaction by a U.S. person or within
the United States that evades or avoids,
has the purpose of evading or avoiding,
causes a violation of, or attempts to
violate any of the prohibitions set forth
in the Regulations, and any conspiracy
formed to violate such prohibitions.
Sections 537.207 and 537.208 of
subpart B detail the effect of transfers of
blocked property in violation of the
Regulations and set forth the
requirement to hold blocked funds, such
as currency, bank deposits, or liquidated
financial obligations, in blocked
interest-bearing accounts. Section
537.209 provides that all expenses
incident to the maintenance of blocked
physical property shall be the
responsibility of the owners or operators
of such property, and that such
expenses shall not be met from blocked
funds, unless otherwise authorized. The
section further provides that blocked
property may, in OFAC’s discretion, be
sold or liquidated and the net proceeds
placed in a blocked interest-bearing
account in the name of the owner of the
property.
Exemptions from certain prohibitions
contained in the Regulations are set
forth in section 537.210 of subpart B,
including, pursuant to E.O. 13619, a
new exemption for the official business
of the U.S. Government.
Subpart C defines key terms used
throughout the Regulations, and subpart
D contains interpretive sections
regarding the Regulations. Section
537.416 of subpart D explains that the
property and interests in property of an
entity are blocked if the entity is 50
percent or more owned by a person
whose property and interests in
property are blocked, whether or not the
name of the entity is incorporated into
the SDN List.
Transactions otherwise prohibited
under the Regulations but found to be
consistent with U.S. policy may be
authorized by one of the general
licenses contained in subpart E of the
Regulations or by a specific license
issued pursuant to the procedures
described in subpart E of 31 CFR part
501. Subpart E of the Regulations also
contains certain statements of specific
licensing policy. Several sections in
subpart E of the Regulations have been
removed and reserved. In some cases
activities previously authorized in those
sections, including certain importations,
are no longer prohibited. In other cases,
including certain financial transactions,
the current licensing policy is now
reflected in new sections 537.529 and
537.531, which authorize the
E:\FR\FM\30JNR3.SGM
30JNR3
37108
Federal Register / Vol. 79, No. 125 / Monday, June 30, 2014 / Rules and Regulations
exportation or reexportation of financial
services to Burma and certain
transactions involving financial
institutions included on the SDN List,
respectively. In light of the new general
licenses authorizing the exportation or
reexportation of financial services to
Burma and certain transactions
involving financial institutions included
on the SDN List, the general license
formerly found in section 537.525,
which broadly authorized transactions,
including with persons whose property
or interests in property are blocked
pursuant to section 537.201(a), by U.S.
citizens permanently residing in Burma,
has been removed.
Subpart F of the Regulations refers to
subpart C of part 501 for applicable
recordkeeping and reporting
requirements. Subpart G describes the
civil and criminal penalties applicable
to violations of the Regulations, as well
as the procedures governing the
potential imposition of a civil monetary
penalty. Subpart G also refers to
Appendix A of part 501 for a more
complete description of these
procedures.
Subpart H of the Regulations refers to
subpart E of part 501 for applicable
provisions relating to administrative
procedures and contains a delegation of
authority by the Secretary of the
Treasury. Subpart I sets forth a
Paperwork Reduction Act notice.
mstockstill on DSK4VPTVN1PROD with RULES3
Public Participation
Because the Regulations involve a
foreign affairs function, the provisions
of Executive Order 12866 and the
Administrative Procedure Act (5 U.S.C.
553) requiring notice of proposed
rulemaking, opportunity for public
participation, and delay in effective date
are inapplicable. Because no notice of
proposed rulemaking is required for this
rule, the Regulatory Flexibility Act (5
U.S.C. 601–612) does not apply.
Paperwork Reduction Act
The collections of information related
to the Regulations are contained in 31
CFR part 501 (the ‘‘Reporting,
Procedures and Penalties Regulations’’).
Pursuant to the Paperwork Reduction
Act of 1995 (44 U.S.C. 3507), those
collections of information have been
approved by the Office of Management
and Budget under control number 1505–
0164. An agency may not conduct or
sponsor, and a person is not required to
respond to, a collection of information
unless the collection of information
displays a valid control number.
List of Subjects in 31 CFR Part 537
Administrative practice and
procedure, Banks, Banking, Blocking of
VerDate Mar<15>2010
20:32 Jun 27, 2014
Jkt 232001
assets, Burma, Credit, Exportation,
Exports, Foreign trade, Importation,
Imports, Investments, Jadeite, Loans,
New investment, Penalties, Reporting
and recordkeeping requirements,
Rubies, Securities, Services, Specially
Designated Nationals.
For the reasons set forth in the
preamble, the Department of the
Treasury’s Office of Foreign Assets
Control revises part 537 of 31 CFR
chapter V to read as follows:
PART 537—BURMESE SANCTIONS
REGULATIONS
Subpart A—Relation of This Part to Other
Laws and Regulations
537.101 Relation of this part to other laws
and regulations.
Subpart B—Prohibitions
537.201 Prohibited transactions involving
blocked property.
537.202 Prohibited exportation or
reexportation of financial services to
Burma.
537.203 Prohibited importation of Burmese
jadeite and rubies into the United States.
537.204 Prohibited new investment in
Burma.
537.205 Prohibited facilitation.
537.206 Evasions; attempts; causing
violations; conspiracies.
537.207 Effect of transfers violating the
provisions of this part.
537.208 Holding of funds in interestbearing accounts; investment and
reinvestment.
537.209 Expenses of maintaining blocked
physical property; liquidation of blocked
property.
537.210 Exempt transactions.
Subpart C—General Definitions
537.300 Applicability of definitions.
537.301 Blocked account; blocked property.
537.302 Economic development of
resources located in Burma.
537.303 Effective date.
537.304 Entity.
537.305 Exportation or reexportation of
financial services to Burma.
537.306 Foreign person.
537.307 Government of Burma.
537.308 Information or informational
materials.
537.309 Interest.
537.310 Licenses; general and specific.
537.311 New investment.
537.312 Nongovernmental entity in Burma.
537.313 Person.
537.314 [Reserved]
537.315 Property; property interest.
537.316 Resources located in Burma.
537.317 Transfer.
537.318 United States.
537.319 U.S. depository institution.
537.320 U.S. financial institution.
537.321 United States person; U.S. person.
537.322 U.S. registered broker or dealer in
securities.
537.323 U.S. registered money transmitter.
537.324 Jadeite.
537.325 Rubies.
PO 00000
Frm 00004
Fmt 4701
Sfmt 4700
537.326 Articles of jewelry containing
jadeite or rubies.
537.327 Financial, material, or
technological support.
537.328 OFAC.
Subpart D—Interpretations
537.401 Reference to amended sections.
537.402 Effect of amendment.
537.403 Termination and acquisition of an
interest in blocked property.
537.404 Transactions ordinarily incident to
a licensed transaction.
537.405 Provision of services.
537.406 Offshore transactions involving
blocked property.
537.407 Payments from blocked accounts to
satisfy obligations prohibited.
537.408 Setoffs prohibited.
537.409 Activities under pre-May 21, 1997
agreements.
537.410 Contracts and subcontracts
regarding economic development of
resources in Burma.
537.411 [Reserved]
537.412 Investments in entities involved in
economic development projects in
Burma.
537.413 [Reserved]
537.414 Charitable contributions.
537.415 Credit extended and cards issued
by U.S. financial institutions to a person
whose property and interests in property
are blocked.
537.416 Entities owned by a person whose
property and interests in property are
blocked.
537.417 Importation into a bonded
warehouse or foreign trade zone.
537.418 Facilitating new investment.
Subpart E—Licenses, Authorizations, and
Statements of Licensing Policy
537.501 General and specific licensing
procedures.
537.502 Effect of license or authorization.
537.503 Exclusion from licenses.
537.504 Payments and transfers to blocked
accounts in U.S. financial institutions.
537.505 Entries in certain accounts for
normal service charges authorized.
537.506 Investment and reinvestment of
certain funds.
537.507 Provision of certain legal services
authorized.
537.508 Authorization of emergency
medical services.
537.509 Official activities of certain
international organizations authorized.
537.510–537.518 [Reserved]
537.519 Activities undertaken pursuant to
certain pre-May 21, 1997 agreements.
537.520–537.521 [Reserved]
537.522 Certain transactions related to
patents, trademarks, copyrights, and
other intellectual property authorized.
537.523–537.525 [Reserved]
537.526 Transactions necessary and
ordinarily incident to publishing
authorized.
537.527 [Reserved]
537.528 Payments for legal services from
funds originating outside the United
States authorized.
537.529 Exportation or reexportation of
financial services to Burma authorized.
E:\FR\FM\30JNR3.SGM
30JNR3
Federal Register / Vol. 79, No. 125 / Monday, June 30, 2014 / Rules and Regulations
537.530 New investment in Burma by U.S.
persons authorized.
537.531 Certain transactions involving
Asia Green Development Bank,
Ayeyarwady Bank, Myanma Economic
Bank, and Myanma Investment and
Commercial Bank authorized.
Subpart F—Reports
537.601
Records and reports.
Subpart G—Penalties
537.701 Penalties.
537.702 Pre-Penalty Notice; settlement.
537.703 Penalty imposition.
537.704 Administrative collection; referral
to United States Department of Justice.
Subpart H—Procedures
537.801 Procedures.
537.802 Delegation by the Secretary of the
Treasury.
Subpart I—Paperwork Reduction Act
537.901
Paperwork Reduction Act notice.
Authority: 3 U.S.C. 301; 31 U.S.C. 321(b);
50 U.S.C 1601–1651, 1701–1706; Pub. L.
101–410, 104 Stat. 890 (28 U.S.C. 2461 note);
Sec. 570, Pub. L. 104–208, 110 Stat. 3009;
Pub. L. 110–96, 121 Stat. 1011 (50 U.S.C.
1701 note); Pub. L. 110–286, 122 Stat. 2632
(50 U.S.C. 1701 note); E.O. 13047, 62 FR
28301, 3 CFR, 1997 Comp., p. 202; E.O.
13310, 68 FR 44853, 3 CFR, 2003 Comp., p.
241; E.O. 13448, 72 FR 60223, 3 CFR, 2007
Comp., p. 304; E.O. 13464, 73 FR 24491, 3
CFR, 2008 Comp., p. 189; E.O. 13619, 77 FR
41243, 3 CFR, 2012 Comp., p. 279; E.O.
13651, 78 FR 48793 (August 9, 2013);
Determination No. 2009–11, 74 FR 3957, 3
CFR, 2009 Comp., p. 330.
Subpart A—Relation of This Part to
Other Laws and Regulations
mstockstill on DSK4VPTVN1PROD with RULES3
§ 537.101 Relation of this part to other
laws and regulations.
This part is separate from, and
independent of, the other parts of this
chapter, with the exception of part 501
of this chapter, the recordkeeping and
reporting requirements and license
application and other procedures of
which apply to this part. Actions taken
pursuant to part 501 of this chapter with
respect to the prohibitions contained in
this part are considered actions taken
pursuant to this part. Differing foreign
policy and national security
circumstances may result in differing
interpretations of similar language
among the parts of this chapter. No
license or authorization contained in or
issued pursuant to those other parts
authorizes any transaction prohibited by
this part. No license or authorization
contained in or issued pursuant to any
other provision of law or regulation
authorizes any transaction prohibited by
this part. No license or authorization
contained in or issued pursuant to this
part relieves the involved parties from
VerDate Mar<15>2010
20:32 Jun 27, 2014
Jkt 232001
complying with any other applicable
laws or regulations.
Subpart B—Prohibitions
§ 537.201 Prohibited transactions
involving blocked property.
(a)(1) All property and interests in
property that are in the United States,
that come within the United States, or
that are or come within the possession
or control of any United States person,
including any foreign branch, of the
following persons are blocked and may
not be transferred, paid, exported,
withdrawn, or otherwise dealt in:
(i) The persons listed in the Annex to
Executive Order 13310 of July 28, 2003
(E.O. 13310), the Annex to Executive
Order 13448 of October 18, 2007 (E.O.
13448), or the Annex to Executive Order
13464 of April 30, 2008 (E.O. 13464);
and
(ii) Any person determined by the
Secretary of the Treasury, in
consultation with the Secretary of State:
(A) To be a senior official of the
Government of Burma, the State Peace
and Development Council of Burma, the
Union Solidarity and Development
Association of Burma, or any successor
entity to any of the foregoing;
(B) To be responsible for, or to have
participated in, human rights abuses
related to political repression in Burma;
(C) To be engaged, or to have engaged,
in activities facilitating public
corruption by senior officials of the
Government of Burma;
(D) To be a spouse or dependent child
of any person whose property and
interests in property are blocked
pursuant to E.O. 13310 or E.O. 13448;
(E) To be owned or controlled by,
directly or indirectly, the Government of
Burma or an official or officials of the
Government of Burma;
(F) To have materially assisted,
sponsored, or provided financial,
material, or technological support for, or
goods or services in support of, the
Government of Burma, the State Peace
and Development Council of Burma, the
Union Solidarity and Development
Association of Burma, any successor
entity to any of the foregoing, any senior
official of any of the foregoing, or any
person whose property and interests in
property are blocked pursuant to this
paragraph (a)(1); or
(G) To be owned or controlled by, or
to have acted or purported to act for or
on behalf of, directly or indirectly, any
person whose property and interests in
property are blocked pursuant to this
paragraph (a)(1).
Note to § 537.201(a)(1): The Department of
State has determined that the State Peace and
Development Council of Burma no longer
exists.
PO 00000
Frm 00005
Fmt 4701
Sfmt 4700
37109
(2) All property and interests in
property that are in the United States,
that come within the United States, or
that are or come within the possession
or control of any United States person,
including any foreign branch, of the
following persons are blocked and may
not be transferred, paid, exported,
withdrawn, or otherwise dealt in: Any
person determined by the Secretary of
the Treasury, in consultation with or at
the recommendation of the Secretary of
State:
(i) To have engaged in acts that
directly or indirectly threaten the peace,
security, or stability of Burma, such as
actions that have the purpose or effect
of undermining or obstructing the
political reform process or the peace
process with ethnic minorities in
Burma;
(ii) To be responsible for or complicit
in, or responsible for ordering,
controlling, or otherwise directing, or to
have participated in, the commission of
human rights abuses in Burma;
(iii) To have, directly or indirectly,
imported, exported, reexported, sold, or
supplied arms or related materiel from
North Korea or the Government of North
Korea to Burma or the Government of
Burma;
(iv) To be a senior official of an entity
that has engaged in the acts described in
paragraphs (a)(2)(i) through (iii) of this
section;
(v) To have materially assisted,
sponsored, or provided financial,
material, or technological support for, or
goods or services to or in support of, the
acts described in paragraphs (a)(2)(i)
through (iii) of this section or any
person whose property and interests in
property are blocked pursuant to this
paragraph (a)(2); or
(vi) To be owned or controlled by, or
to have acted or purported to act for or
on behalf of, directly or indirectly, any
person whose property and interests in
property are blocked pursuant to this
paragraph (a)(2).
Note 1 to paragraph (a) of § 537.201: The
names of persons listed in or designated
pursuant to E.O. 13310, E.O. 13448, E.O.
13464, or Executive Order 13619 of July 11,
2012, whose property and interests in
property are blocked pursuant to paragraph
(a) of this section, are published in the
Federal Register and incorporated into
OFAC’s Specially Designated Nationals and
Blocked Persons List (SDN List) with the
identifier ‘‘[BURMA].’’ The SDN List is
accessible through the following page on
OFAC’s Web site: www.treasury.gov/sdn.
Additional information pertaining to the SDN
List can be found in Appendix A to this
chapter. See § 537.416 concerning entities
that may not be listed on the SDN List but
whose property and interests in property are
nevertheless blocked pursuant to paragraph
(a) of this section.
E:\FR\FM\30JNR3.SGM
30JNR3
37110
Federal Register / Vol. 79, No. 125 / Monday, June 30, 2014 / Rules and Regulations
Note 2 to paragraph (a) of § 537.201: The
International Emergency Economic Powers
Act (50 U.S.C. 1701–1706), in section 203 (50
U.S.C. 1702), authorizes the blocking of
property and interests in property of a person
during the pendency of an investigation. The
names of persons whose property and
interests in property are blocked pending
investigation pursuant to paragraph (a) of this
section also are published in the Federal
Register and incorporated into the SDN List
with the identifier ‘‘[BPI–BURMA].’’
mstockstill on DSK4VPTVN1PROD with RULES3
Note 3 to paragraph (a) of § 537.201:
Sections 501.806 and 501.807 of this chapter
describe the procedures to be followed by
persons seeking, respectively, the unblocking
of funds that they believe were blocked due
to mistaken identity, or administrative
reconsideration of their status as persons
whose property and interests in property are
blocked pursuant to paragraph (a) of this
section.
(b) The prohibitions in paragraph (a)
of this section include, but are not
limited to, prohibitions on the following
transactions:
(1) The making of any contribution or
provision of funds, goods, or services
by, to, or for the benefit of any person
whose property and interests in
property are blocked pursuant to
paragraph (a) of this section; and
(2) The receipt of any contribution or
provision of funds, goods, or services
from any person whose property and
interests in property are blocked
pursuant to paragraph (a) of this section.
(c) Unless authorized by this part or
by a specific license expressly referring
to this section, any dealing in any
security (or evidence thereof) held
within the possession or control of a
U.S. person and either registered or
inscribed in the name of, or known to
be held for the benefit of, or issued by,
any person whose property and interests
in property are blocked pursuant to
paragraph (a) of this section is
prohibited. This prohibition includes
but is not limited to the transfer
(including the transfer on the books of
any issuer or agent thereof), disposition,
transportation, importation, exportation,
or withdrawal of, or the endorsement or
guaranty of signatures on, any such
security on or after the effective date.
This prohibition applies irrespective of
the fact that at any time (whether prior
to, on, or subsequent to the effective
date) the registered or inscribed owner
of any such security may have or might
appear to have assigned, transferred, or
otherwise disposed of the security.
(d) The prohibitions in paragraph (a)
of this section apply except to the extent
transactions are authorized by
regulations, orders, directives, rulings,
instructions, licenses, or otherwise, and
notwithstanding any contract entered
VerDate Mar<15>2010
20:32 Jun 27, 2014
Jkt 232001
into or any license or permit granted
prior to the effective date.
jadeite, rubies, and articles of jewelry
containing jadeite or rubies, respectively.
Note to § 537.201: Section 5(b) of the Tom
Lantos Block Burmese JADE (Junta’s AntiDemocratic Efforts) Act of 2008 (Pub. L. 110–
286) (JADE Act) imposes blocking and
financial sanctions on certain categories of
persons described in Section 5(a)(1) of the
JADE Act. In Executive Order 13651 of
August 6, 2013, the President waived these
blocking and financial sanctions pursuant to
Section 5(i) of the JADE Act. Except as
authorized or exempt, transactions involving
persons whose property and interests in
property are blocked pursuant to paragraph
(a) of this section continue to be prohibited.
§ 537.204
Burma.
§ 537.202 Prohibited exportation or
reexportation of financial services to
Burma.
Except as otherwise authorized, the
exportation or reexportation, directly or
indirectly, to Burma of any financial
services from the United States or by a
U.S. person, wherever located, is
prohibited.
Note to § 537.202: See § 537.529 for a
general license authorizing the exportation or
reexportation of financial services to Burma.
§ 537.203 Prohibited importation of
Burmese jadeite and rubies into the United
States.
(a) Except as provided in paragraphs
(b) and (c) of this section or as otherwise
authorized, the importation into the
United States of any jadeite or rubies
mined or extracted from Burma and any
articles of jewelry containing jadeite or
rubies mined or extracted from Burma is
prohibited.
(b) The prohibition in paragraph (a) of
this section does not apply to any
jadeite or rubies mined or extracted
from Burma or any articles of jewelry
containing jadeite or rubies mined or
extracted from Burma that were
previously exported from the United
States, including those that
accompanied an individual outside the
United States for personal use, if they
are reimported to the United States by
the same person, without having been
advanced in value or improved in
condition by any process or other means
while outside the United States.
(c) Nothing in paragraph (a) of this
section shall prohibit transactions to the
extent such prohibition would conflict
with the international obligations of the
United States under the Vienna
Convention on Diplomatic Relations,
the Vienna Convention on Consular
Relations, the United Nations
Headquarters Agreement, or other legal
instruments providing equivalent
privileges and immunities.
Note § 537.203: See §§ 537.324, 537.325,
and 537.326 for definitions of the terms
PO 00000
Frm 00006
Fmt 4701
Sfmt 4700
Prohibited new investment in
Except as otherwise authorized, new
investment, as defined in § 537.311, in
Burma by U.S. persons is prohibited.
Note to § 537.204: See § 537.530 for a
general license authorizing new investment
in Burma by U.S. persons.
§ 537.205
Prohibited facilitation.
(a) Except as otherwise authorized,
U.S. persons, wherever located, are
prohibited from approving, financing,
facilitating, or guaranteeing a
transaction by a person who is a foreign
person where the transaction by that
foreign person would be prohibited by
§ 537.202 or § 537.204 of this part if
performed by a U.S. person or within
the United States.
(b) With respect to new investment in
Burma, the prohibition against
facilitation does not include the entry
into, performance of, or financing of a
contract to sell or purchase goods,
services, or technology unless such
contract includes any of the activities
described in § 537.311(a)(2), (3), or (4).
Note to § 537.205: See § 537.530 for a
general license authorizing new investment
in Burma by U.S. persons. See § 537.418 for
an interpretive provision regarding
facilitating new investment in Burma.
§ 537.206 Evasions; attempts; causing
violations; conspiracies.
(a) Any transaction by a U.S. person
or within the United States on or after
the effective date that evades or avoids,
has the purpose of evading or avoiding,
causes a violation of, or attempts to
violate any of the prohibitions set forth
in this part is prohibited.
(b) Any conspiracy formed to violate
any of the prohibitions set forth in this
part is prohibited.
§ 537.207 Effect of transfers violating the
provisions of this part.
(a) Any transfer after the effective date
that is in violation of any provision of
this part or of any regulation, order,
directive, ruling, instruction, or license
issued pursuant to this part, and that
involves any property or interest in
property blocked pursuant to
§ 537.201(a), is null and void and shall
not be the basis for the assertion or
recognition of any interest in or right,
remedy, power, or privilege with respect
to such property or property interest.
(b) No transfer before the effective
date shall be the basis for the assertion
or recognition of any right, remedy,
power, or privilege with respect to, or
any interest in, any property or interest
E:\FR\FM\30JNR3.SGM
30JNR3
mstockstill on DSK4VPTVN1PROD with RULES3
Federal Register / Vol. 79, No. 125 / Monday, June 30, 2014 / Rules and Regulations
in property blocked pursuant to
§ 537.201(a), unless the person who
holds or maintains such property, prior
to that date, had written notice of the
transfer or by any written evidence had
recognized such transfer.
(c) Unless otherwise provided, a
license or other authorization issued by
OFAC before, during, or after a transfer
shall validate such transfer or make it
enforceable to the same extent that it
would be valid or enforceable but for
the provisions of this part and any
regulation, order, directive, ruling,
instruction, or license issued pursuant
to this part.
(d) Transfers of property that
otherwise would be null and void or
unenforceable by virtue of the
provisions of this section shall not be
deemed to be null and void or
unenforceable as to any person with
whom such property is or was held or
maintained (and as to such person only)
in cases in which such person is able to
establish to the satisfaction of OFAC
each of the following:
(1) Such transfer did not represent a
willful violation of the provisions of this
part by the person with whom such
property is or was held or maintained
(and as to such person only);
(2) The person with whom such
property is or was held or maintained
did not have reasonable cause to know
or suspect, in view of all the facts and
circumstances known or available to
such person, that such transfer required
a license or authorization issued
pursuant to this part and was not so
licensed or authorized, or, if a license or
authorization did purport to cover the
transfer, that such license or
authorization had been obtained by
misrepresentation of a third party or
withholding of material facts or was
otherwise fraudulently obtained; and
(3) The person with whom such
property is or was held or maintained
filed with OFAC a report setting forth in
full the circumstances relating to such
transfer promptly upon discovery that:
(i) Such transfer was in violation of
the provisions of this part or any
regulation, ruling, instruction, license,
or other directive or authorization
issued pursuant to this part;
(ii) Such transfer was not licensed or
authorized by OFAC; or
(iii) If a license did purport to cover
the transfer, such license had been
obtained by misrepresentation of a third
party or withholding of material facts or
was otherwise fraudulently obtained.
Note to § 537.207(d): The filing of a report
in accordance with the provisions of
paragraph (d)(3) of this section shall not be
deemed evidence that the terms of
VerDate Mar<15>2010
20:32 Jun 27, 2014
Jkt 232001
paragraphs (d)(1) and (2) of this section have
been satisfied.
(e) Unless licensed pursuant to this
part, any attachment, judgment, decree,
lien, execution, garnishment, or other
judicial process is null and void with
respect to any property and interests in
property blocked pursuant to
§ 537.201(a).
§ 537.208 Holding of funds in interestbearing accounts; investment and
reinvestment.
(a) Except as provided in paragraph
(e) or (f) of this section, or as otherwise
directed by OFAC, any U.S. person
holding funds, such as currency, bank
deposits, or liquidated financial
obligations, subject to § 537.201(a) shall
hold or place such funds in a blocked
interest-bearing account located in the
United States.
(b)(1) For purposes of this section, the
term blocked interest-bearing account
means a blocked account:
(i) In a federally-insured U.S. bank,
thrift institution, or credit union,
provided the funds are earning interest
at rates that are commercially
reasonable; or
(ii) With a broker or dealer registered
with the Securities and Exchange
Commission under the Securities
Exchange Act of 1934 (15 U.S.C. 78a et
seq.), provided the funds are invested in
a money market fund or in U.S.
Treasury bills.
(2) Funds held or placed in a blocked
account pursuant to paragraph (a) of this
section may not be invested in
instruments the maturity of which
exceeds 180 days.
(c) For purposes of this section, a rate
is commercially reasonable if it is the
rate currently offered to other depositors
on deposits or instruments of
comparable size and maturity.
(d) For purposes of this section, if
interest is credited to a separate blocked
account or subaccount, the name of the
account party on each account must be
the same.
(e) Blocked funds held in instruments
the maturity of which exceeds 180 days
at the time the funds become subject to
§ 537.201(a) may continue to be held
until maturity in the original
instrument, provided any interest,
earnings, or other proceeds derived
therefrom are paid into a blocked
interest-bearing account in accordance
with paragraph (a) or (f) of this section.
(f) Blocked funds held in accounts or
instruments outside the United States at
the time the funds become subject to
§ 537.201(a) may continue to be held in
the same type of accounts or
instruments, provided the funds earn
PO 00000
Frm 00007
Fmt 4701
Sfmt 4700
37111
interest at rates that are commercially
reasonable.
(g) This section does not create an
affirmative obligation for the holder of
blocked tangible property, such as
chattels or real estate, or of other
blocked property, such as debt or equity
securities, to sell or liquidate such
property. However, OFAC may issue
licenses permitting or directing such
sales or liquidation in appropriate cases.
(h) Funds subject to this section may
not be held, invested, or reinvested in
a manner that provides immediate
financial or economic benefit or access
to any person whose property and
interests in property are blocked
pursuant to § 537.201(a), nor may their
holder cooperate in or facilitate the
pledging or other attempted use as
collateral of blocked funds or other
assets.
§ 537.209 Expenses of maintaining
blocked physical property; liquidation of
blocked property.
(a) Except as otherwise authorized,
and notwithstanding the existence of
any rights or obligations conferred or
imposed by any international agreement
or contract entered into or any license
or permit granted prior to the effective
date, all expenses incident to the
maintenance of physical property
blocked pursuant to § 537.201(a) shall
be the responsibility of the owners or
operators of such property, which
expenses shall not be met from blocked
funds.
(b) Property blocked pursuant to
§ 537.201(a) may, in the discretion of
OFAC, be sold or liquidated and the net
proceeds placed in a blocked interestbearing account in the name of the
owner of the property.
§ 537.210
Exempt transactions.
(a) Personal communications. The
prohibitions contained in this part do
not apply to any postal, telegraphic,
telephonic, or other personal
communication that does not involve
the transfer of anything of value.
(b) Information or informational
materials. (1) The prohibitions
contained in this part do not apply to
the importation from any country and
the exportation to any country of any
information or informational materials,
as defined in § 537.308, whether
commercial or otherwise, regardless of
format or medium of transmission.
(2) This section does not exempt from
regulation or authorize transactions
related to information or informational
materials not fully created and in
existence at the date of the transactions,
or to the substantive or artistic alteration
or enhancement of informational
E:\FR\FM\30JNR3.SGM
30JNR3
mstockstill on DSK4VPTVN1PROD with RULES3
37112
Federal Register / Vol. 79, No. 125 / Monday, June 30, 2014 / Rules and Regulations
materials, or to the provision of
marketing and business consulting
services. Such prohibited transactions
include, but are not limited to, payment
of advances for information or
informational materials not yet created
and completed (with the exception of
prepaid subscriptions for widely
circulated magazines and other
periodical publications); provision of
services to market, produce or coproduce, create, or assist in the creation
of information or informational
materials; and payment of royalties with
respect to income received for
enhancements or alterations made by
U.S. persons to such information or
informational materials.
(3) This section does not exempt or
authorize transactions incident to the
exportation of software subject to the
Export Administration Regulations, 15
CFR parts 730–774, or to the exportation
of goods (including software) or
technology for use in the transmission
of any data, or to the provision, sale, or
leasing of capacity on
telecommunications transmission
facilities (such as satellite or terrestrial
network connectivity) for use in the
transmission of any data. The
exportation of such items or services
and the provision, sale, or leasing of
such capacity or facilities to a person
whose property and interests in
property are blocked pursuant to
§ 537.201(a) are prohibited.
(c) Travel. The prohibitions contained
in this part do not apply to transactions
ordinarily incident to travel to or from
any country, including importation or
exportation of accompanied baggage for
personal use, maintenance within any
country including payment of living
expenses and acquisition of goods or
services for personal use, and
arrangement or facilitation of such
travel, including nonscheduled air, sea,
or land voyages.
(d) Pre-1997 contracts. Except as
prohibited by § 537.201(a) with respect
to persons whose property and interests
in property are blocked pursuant to
Executive Order 13448 of October 18,
2007, Executive Order 13464 of April
30, 2008, or Executive Order 13619 of
July 11, 2012, or by § 537.203, the
prohibitions contained in this part do
not apply to any activity undertaken
pursuant to an agreement, or pursuant
to the exercise of rights under such an
agreement, that was entered into by a
U.S. person with the Government of
Burma or a non-governmental entity in
Burma prior to 12:01 a.m. eastern
daylight time on May 21, 1997.
(e) Official business. The prohibitions
contained in this part, other than that in
§ 537.203, do not apply to transactions
VerDate Mar<15>2010
20:32 Jun 27, 2014
Jkt 232001
for the conduct of the official business
of the United States Government by
employees, grantees, or contractors
thereof.
Note to § 537.210(e): Section 537.210(e)
does not apply to the extent that engaging in
such transactions would require the issuance
of a statutory waiver and such a waiver is not
issued. As of June 30, 2014, the statutory
waivers required to authorize otherwise
prohibited transactions have been issued.
Specifically, the Department of State,
pursuant to a delegation of authority from the
President, waived the ban on new U.S.
investment in Burma set forth in the Foreign
Operations, Export Financing, and Related
Programs Appropriations Act, 1997, and in
§ 537.204 of this part. In addition, in
Executive Order 13651 of August 6, 2013, the
President waived pursuant to Section 5(i) of
the Tom Lantos Block Burmese JADE (Junta’s
Anti-Democratic Efforts) Act of 2008 (Pub. L.
110–286) (JADE Act) the blocking and
financial sanctions provisions of Section 5(b)
of the JADE Act.
Subpart C—General Definitions
§ 537.300
Applicability of definitions.
The definitions in this subpart apply
throughout the entire part.
§ 537.301
property.
Blocked account; blocked
The terms blocked account and
blocked property shall mean any
account or property subject to the
prohibitions in § 537.201 held in the
name of a person whose property and
interests in property are blocked
pursuant to § 537.201(a), or in which
such person has an interest, and with
respect to which payments, transfers,
exportations, withdrawals, or other
dealings may not be made or effected
except pursuant to a license or other
authorization from OFAC expressly
authorizing such action.
Note to § 537.301: See § 537.416
concerning the blocked status of property
and interests in property of an entity that is
50 percent or more owned by a person whose
property and interests in property are
blocked pursuant to § 537.201(a).
§ 537.302 Economic development of
resources located in Burma.
(a) The term economic development
of resources located in Burma means
activities pursuant to a contract the
subject of which includes responsibility
for the development or exploitation of
resources located in Burma, including
making or attempting to make those
resources accessible or available for
exploitation or economic use. The term
shall not be construed to include notfor-profit educational, health, or other
humanitarian programs or activities.
(b) Examples: The economic
development of resources located in
PO 00000
Frm 00008
Fmt 4701
Sfmt 4700
Burma includes a contract conferring
rights to explore for, develop, extract, or
refine petroleum, natural gas, or
minerals in the ground in Burma; or a
contract to assume control of a mining
operation in Burma, acquire a forest or
agricultural area for commercial use of
the timber or other crops, or acquire
land for the construction and operation
of a hotel or factory.
Note to § 537.302: See § 537.316 for a
definition of the term resources located in
Burma.
§ 537.303
Effective date.
The term effective date refers to the
effective date of the applicable
prohibitions and directives contained in
this part as follows:
(a) With respect to a person whose
property and interests in property are
blocked pursuant to § 537.201(a)(1)(i),
12:01 a.m. eastern daylight time, July
29, 2003, for persons listed in the Annex
to Executive Order 13310 of July 28,
2003; 12:01 a.m. eastern daylight time,
October 19, 2007, for persons listed in
the Annex to Executive Order 13448 of
October 18, 2007; and 12:01 a.m. eastern
daylight time, May 1, 2008, for persons
listed in the Annex to Executive Order
13464 of April 30, 2008;
(b) With respect to a person whose
property and interests in property are
otherwise blocked pursuant to
§ 537.201(a), the earlier of the date of
actual or constructive notice that such
person’s property and interests in
property are blocked;
(c) With respect to the exportation or
reexportation of financial services to
Burma prohibited by § 537.202, or with
respect to facilitation thereof prohibited
by § 537.205, 12:01 a.m. eastern daylight
time, July 29, 2003;
(d) With respect to the importation
into the United States of any jadeite or
rubies mined or extracted from Burma
and any articles of jewelry containing
jadeite or rubies mined or extracted
from Burma prohibited by § 537.203,
12:01 a.m. eastern daylight time, August
7, 2013;
(e) With respect to new investment
prohibited by § 537.204, or with respect
to facilitation thereof prohibited by
§ 537.205, 12:01 a.m. eastern daylight
time, May 21, 1997.
§ 537.304
Entity.
The term entity means a partnership,
association, trust, joint venture,
corporation, group, subgroup, or other
organization.
§ 537.305 Exportation or reexportation of
financial services to Burma.
The term exportation or reexportation
of financial services to Burma means:
E:\FR\FM\30JNR3.SGM
30JNR3
Federal Register / Vol. 79, No. 125 / Monday, June 30, 2014 / Rules and Regulations
(a) The transfer of funds, directly or
indirectly, from the United States or by
a U.S. person, wherever located, to
Burma; or
(b) The provision, directly or
indirectly, to persons in Burma of
insurance services, investment or
brokerage services (including but not
limited to brokering or trading services
regarding securities, debt, commodities,
options, or foreign exchange), banking
services, or money remittance services;
loans, guarantees, letters of credit, or
other extensions of credit; or the service
of selling or redeeming traveler’s
checks, money orders, or stored value.
§ 537.306
Foreign person.
The term foreign person means any
person that is not a U.S. person.
§ 537.307
Government of Burma.
The term Government of Burma
means the Government of Burma (also
known as Myanmar), its agencies,
instrumentalities, and controlled
entities, and the Central Bank of Burma.
§ 537.308 Information or informational
materials.
(a) The term information or
informational materials includes, but is
not limited to, publications, films,
posters, phonograph records,
photographs, microfilms, microfiche,
tapes, compact disks, CD ROMs,
artworks, and news wire feeds.
Note to § 537.308(a): To be considered
information or informational materials,
artworks must be classified under heading
9701, 9702, or 9703 of the Harmonized Tariff
Schedule of the United States.
(b) The term information or
informational materials, with respect to
exports, does not include items:
(1) That were, as of April 30, 1994, or
that thereafter become, controlled for
export pursuant to section 5 of the
Export Administration Act of 1979, 50
U.S.C. App. 2401–2420 (1979) (the
‘‘EAA’’), or section 6 of the EAA to the
extent that such controls promote the
nonproliferation or antiterrorism
policies of the United States; or
(2) With respect to which acts are
prohibited by 18 U.S.C. chapter 37.
mstockstill on DSK4VPTVN1PROD with RULES3
§ 537.309
Interest.
Except as otherwise provided in this
part, the term interest, when used with
respect to property (e.g., ‘‘an interest in
property’’), means an interest of any
nature whatsoever, direct or indirect.
§ 537.310
Licenses; general and specific.
(a) Except as otherwise provided in
this part, the term license means any
license or authorization contained in or
issued pursuant to this part.
VerDate Mar<15>2010
20:32 Jun 27, 2014
Jkt 232001
(b) The term general license means
any license or authorization the terms of
which are set forth in subpart E of this
part or are made available on OFAC’s
Web site: www.treasury.gov/ofac.
(c) The term specific license means
any license or authorization issued
pursuant to this part, but not set forth
in subpart E of this part or made
available on OFAC’s Web site.
Note to § 537.310: See § 501.801 of this
chapter on licensing procedures.
§ 537.311
New investment.
(a) The term new investment means
any of the following activities if such
activity is undertaken pursuant to an
agreement, or pursuant to the exercise of
rights under such an agreement, that is
entered into with the Government of
Burma or a nongovernmental entity in
Burma on or after May 21, 1997:
(1) The entry into a contract that
includes the economic development of
resources located in Burma, as defined
in § 537.302;
(2) The entry into a contract providing
for the general supervision and
guarantee of another person’s
performance of a contract that includes
the economic development of resources
located in Burma;
(3) The purchase of a share of
ownership, including an equity interest,
in the economic development of
resources located in Burma; or
(4) The entry into a contract providing
for the participation in royalties,
earnings, or profits in the economic
development of resources located in
Burma, without regard to the form of the
participation.
(b) The term new investment shall not
include the entry into, performance of,
or financing of a contract to sell or
purchase goods, services, or technology
unless such contract includes any of the
activities described in paragraphs (a)(2)
through (4) of this section.
§ 537.312
Burma.
Nongovernmental entity in
The term nongovernmental entity in
Burma means a partnership, association,
trust, joint venture, corporation, or other
organization, wherever organized, that
is located in Burma or exists for the
exclusive or predominant purpose of
engaging in the economic development
of resources located in Burma or derives
its income predominantly from such
economic development, and is not the
Government of Burma.
§ 537.313
Person.
The term person means an individual
or entity.
PO 00000
Frm 00009
Fmt 4701
Sfmt 4700
37113
§ 537.314
[Reserved]
§ 537.315
Property; property interest.
The terms property and property
interest include, but are not limited to,
money, checks, drafts, bullion, bank
deposits, savings accounts, debts,
indebtedness, obligations, notes,
guarantees, debentures, stocks, bonds,
coupons, any other financial
instruments, bankers acceptances,
mortgages, pledges, liens or other rights
in the nature of security, warehouse
receipts, bills of lading, trust receipts,
bills of sale, any other evidences of title,
ownership or indebtedness, letters of
credit and any documents relating to
any rights or obligations thereunder,
powers of attorney, goods, wares,
merchandise, chattels, stocks on hand,
ships, goods on ships, real estate
mortgages, deeds of trust, vendors’ sales
agreements, land contracts, leaseholds,
ground rents, real estate and any other
interest therein, options, negotiable
instruments, trade acceptances,
royalties, book accounts, accounts
payable, judgments, patents, trademarks
or copyrights, insurance policies, safe
deposit boxes and their contents,
annuities, pooling agreements, services
of any nature whatsoever, contracts of
any nature whatsoever, and any other
property, real, personal, or mixed,
tangible or intangible, or interest or
interests therein, present, future, or
contingent.
§ 537.316
Resources located in Burma.
The term resources located in Burma
means any resources, including natural,
agricultural, commercial, financial,
industrial, and human resources,
located within the territory of Burma,
including the territorial sea, or located
within the exclusive economic zone or
continental shelf of Burma.
§ 537.317
Transfer.
The term transfer means any actual or
purported act or transaction, whether or
not evidenced by writing, and whether
or not done or performed within the
United States, the purpose, intent, or
effect of which is to create, surrender,
release, convey, transfer, or alter,
directly or indirectly, any right, remedy,
power, privilege, or interest with respect
to any property. Without limitation on
the foregoing, it shall include the
making, execution, or delivery of any
assignment, power, conveyance, check,
declaration, deed, deed of trust, power
of attorney, power of appointment, bill
of sale, mortgage, receipt, agreement,
contract, certificate, gift, sale, affidavit,
or statement; the making of any
payment; the setting off of any
obligation or credit; the appointment of
E:\FR\FM\30JNR3.SGM
30JNR3
37114
Federal Register / Vol. 79, No. 125 / Monday, June 30, 2014 / Rules and Regulations
any agent, trustee, or fiduciary; the
creation or transfer of any lien; the
issuance, docketing, filing, or levy of or
under any judgment, decree,
attachment, injunction, execution, or
other judicial or administrative process
or order, or the service of any
garnishment; the acquisition of any
interest of any nature whatsoever by
reason of a judgment or decree of any
foreign country; the fulfillment of any
condition; the exercise of any power of
appointment, power of attorney, or
other power; or the acquisition,
disposition, transportation, importation,
exportation, or withdrawal of any
security.
§ 537.318
United States.
The term United States means the
United States, its territories and
possessions, and all areas under the
jurisdiction or authority thereof.
§ 537.319
U.S. depository institution.
The term U.S. depository institution
means any entity (including its foreign
branches) organized under the laws of
the United States or any jurisdiction
within the United States, or any agency,
office, or branch located in the United
States of a foreign entity, that is engaged
primarily in the business of banking (for
example, banks, savings banks, savings
associations, credit unions, trust
companies, and United States bank
holding companies) and is subject to
regulation by federal or state banking
authorities.
mstockstill on DSK4VPTVN1PROD with RULES3
§ 537.320
U.S. financial institution.
The term U.S. financial institution
means any U.S. entity (including its
foreign branches) that is engaged in the
business of accepting deposits, making,
granting, transferring, holding, or
brokering a loan or other extension of
credit, or purchasing or selling foreign
exchange, securities, commodity futures
or options, or procuring purchasers and
sellers thereof, as principal or agent. It
includes but is not limited to depository
institutions, banks, savings banks, trust
companies, securities brokers and
dealers, commodity futures and options
brokers and dealers, forward contract
and foreign exchange merchants,
securities and commodities exchanges,
clearing corporations, investment
companies, employee benefit plans, and
U.S. holding companies, U.S. affiliates,
or U.S. subsidiaries of any of the
foregoing. This term includes those
branches, offices, and agencies of
foreign financial institutions that are
located in the United States, but not
such institutions’ foreign branches,
offices, or agencies.
VerDate Mar<15>2010
20:32 Jun 27, 2014
Jkt 232001
§ 537.321
person.
United States person; U.S.
The term United States person or U.S.
person means any United States citizen,
permanent resident alien, entity
organized under the laws of the United
States or any jurisdiction within the
United States (including foreign
branches), or any person in the United
States.
§ 537.322 U.S. registered broker or dealer
in securities.
The term U.S. registered broker or
dealer in securities means any U.S.
citizen, permanent resident alien, or
entity organized under the laws of the
United States or of any jurisdiction
within the United States (including its
foreign branches), or any agency, office,
or branch of a foreign entity located in
the United States, that:
(a) Is a ‘‘broker’’ or ‘‘dealer’’ in
securities within the meanings set forth
in the Securities Exchange Act of 1934;
(b) Holds or clears customer accounts;
and
(c) Is registered with the Securities
and Exchange Commission under the
Securities Exchange Act of 1934.
§ 537.323 U.S. registered money
transmitter.
The term U.S. registered money
transmitter means any U.S. citizen,
permanent resident alien, or entity
organized under the laws of the United
States or of any jurisdiction within the
United States (including its foreign
branches), or any agency, office, or
branch of a foreign entity located in the
United States, that is a money
transmitter, as defined in 31 CFR
1010.100(ff)(5), and that is registered
pursuant to 31 CFR 1022.380.
§ 537.324
Jadeite.
The term jadeite means any jadeite
classifiable under heading 7103 of the
Harmonized Tariff Schedule of the
United States.
§ 537.325
Rubies.
The term rubies means any rubies
classifiable under heading 7103 of the
Harmonized Tariff Schedule of the
United States.
§ 537.326 Articles of jewelry containing
jadeite or rubies.
The term articles of jewelry containing
jadeite or rubies means any article of
jewelry classifiable under heading 7113
of the Harmonized Tariff Schedule of
the United States that contains jadeite or
rubies, or any article of jadeite or rubies
classifiable under heading 7116 of the
Harmonized Tariff Schedule of the
United States.
PO 00000
Frm 00010
Fmt 4701
Sfmt 4700
§ 537.327 Financial, material, or
technological support.
The term financial, material, or
technological support, as used in
§ 537.201(a) of this part, means any
property, tangible or intangible,
including but not limited to currency,
financial instruments, securities, or any
other transmission of value; weapons or
related materiel; chemical or biological
agents; explosives; false documentation
or identification; communications
equipment; computers; electronic or
other devices or equipment;
technologies; lodging; safe houses;
facilities; vehicles or other means of
transportation; or goods.
‘‘Technologies’’ as used in this
definition means specific information
necessary for the development,
production, or use of a product,
including related technical data such as
blueprints, plans, diagrams, models,
formulae, tables, engineering designs
and specifications, manuals, or other
recorded instructions.
§ 537.328
OFAC.
The term OFAC means the
Department of the Treasury’s Office of
Foreign Assets Control.
Subpart D—Interpretations
§ 537.401
Reference to amended sections.
Except as otherwise specified,
reference to any provision in or
appendix to this part or chapter or to
any regulation, ruling, order,
instruction, directive, or license issued
pursuant to this part refers to the same
as currently amended.
§ 537.402
Effect of amendment.
Unless otherwise specifically
provided, any amendment,
modification, or revocation of any
provision in or appendix to this part or
chapter or of any order, regulation,
ruling, instruction, or license issued by
OFAC does not affect any act done or
omitted, or any civil or criminal
proceeding commenced or pending,
prior to such amendment, modification,
or revocation. All penalties, forfeitures,
and liabilities under any such order,
regulation, ruling, instruction, or license
continue and may be enforced as if such
amendment, modification, or revocation
had not been made.
§ 537.403 Termination and acquisition of
an interest in blocked property.
(a) Whenever a transaction licensed or
authorized by or pursuant to this part
results in the transfer of property
(including any property interest) away
from a person whose property and
interests in property are blocked
pursuant to § 537.201(a), such property
E:\FR\FM\30JNR3.SGM
30JNR3
Federal Register / Vol. 79, No. 125 / Monday, June 30, 2014 / Rules and Regulations
shall no longer be deemed to be
property blocked pursuant to
§ 537.201(a), unless there exists in the
property another interest that is blocked
pursuant to § 537.201(a), the transfer of
which has not been effected pursuant to
license or other authorization.
(b) Unless otherwise specifically
provided in a license or authorization
issued pursuant to this part, if property
(including any property interest) is
transferred or attempted to be
transferred to a person whose property
and interests in property are blocked
pursuant to § 537.201(a), such property
shall be deemed to be property in which
such a person has an interest and
therefore blocked.
§ 537.404 Transactions ordinarily incident
to a licensed transaction.
(a) Any transaction ordinarily
incident to a licensed transaction and
necessary to give effect thereto is also
authorized, except:
(1) An ordinarily incident transaction,
not explicitly authorized within the
terms of the license, by or with a person
whose property and interests in
property are blocked pursuant to
§ 537.201(a), except as provided in
paragraph (b) of this section; or
(2) An ordinarily incident transaction,
not explicitly authorized within the
terms of the license, involving a debit to
a blocked account or a transfer of
blocked property.
(b) Transactions licensed pursuant to
subpart E of this part and those
transactions falling within the scope of
paragraph (a) of this section are
authorized even though they may
involve transfers to or from an account
of a financial institution whose property
and interests in property are blocked
pursuant to § 537.201(a), provided that
the account is not on the books of a
financial institution that is a U.S.
person, unless otherwise authorized.
mstockstill on DSK4VPTVN1PROD with RULES3
Note to § 537.404(b): See § 537.531 for a
general license authorizing transactions
involving certain Burmese financial
institutions whose property and interests in
property are blocked pursuant to
§ 537.201(a), including establishing and
maintaining accounts on the books of U.S.
financial institutions.
(c) Example: A license authorizing a
person to complete a securities sale
involving Company A, whose property
and interests in property are blocked
pursuant to § 537.201(a), also authorizes
other persons to engage in activities that
are ordinarily incident and necessary to
complete the sale, including
transactions by the buyer, broker,
transfer agents, and banks, provided
that, except as provided in paragraph (b)
of this section, such other persons are
VerDate Mar<15>2010
20:32 Jun 27, 2014
Jkt 232001
not themselves persons whose property
and interests in property are blocked
pursuant to § 537.201(a).
§ 537.405
Provision of services.
(a) The prohibitions on transactions
contained in § 537.201 apply to services
performed in the United States or by
U.S. persons, wherever located,
including by a foreign branch of an
entity located in the United States:
(1) On behalf of or for the benefit of
a person whose property and interests
in property are blocked pursuant to
§ 537.201(a); or
(2) With respect to property interests
of any person whose property and
interests in property are blocked
pursuant to § 537.201(a).
(b) Example: U.S. persons may not,
except as authorized by or pursuant to
this part, provide legal, accounting,
financial, brokering, freight forwarding,
transportation, public relations, or other
services to a person whose property and
interests in property are blocked
pursuant to § 537.201(a).
Note to § 537.405: See §§ 537.507 and
537.508 on licensing policy with regard to
the provision of certain legal and emergency
medical services.
§ 537.406 Offshore transactions involving
blocked property.
The prohibitions in § 537.201 on
transactions or dealings involving
blocked property apply to transactions
by any U.S. person in a location outside
the United States with respect to
property held in the name of a person
whose property and interests in
property are blocked pursuant to
§ 537.201(a).
§ 537.407 Payments from blocked
accounts to satisfy obligations prohibited.
Pursuant to § 537.201, no debits may
be made to a blocked account to pay
obligations to U.S. persons or other
persons, except as authorized by or
pursuant to this part.
Note to § 537.407: See also § 537.502(e),
which provides that no license or other
authorization contained in or issued
pursuant to this part authorizes transfers of
or payments from blocked property or debits
to blocked accounts unless the license or
other authorization explicitly authorizes the
transfer of or payment from blocked property
or the debit to a blocked account.
§ 537.408
Setoffs prohibited.
A setoff against blocked property
(including a blocked account), whether
by a U.S. bank or other U.S. person, is
a prohibited transfer under § 537.201 if
effected after the effective date.
PO 00000
Frm 00011
Fmt 4701
Sfmt 4700
37115
§ 537.409 Activities under pre-May 21,
1997 agreements.
Pursuant to § 537.210(d), a U.S.
person who is a party to a pre-May 21,
1997 agreement may enter into
subsequent agreements where such
agreements are pursuant to, or in
exercise of rights under, the pre-May 21,
1997 agreement and are specifically
contemplated by the pre-May 21, 1997
agreement, unless such subsequent
agreements involve any activity
prohibited by § 537.201(a) with respect
to any person whose property and
interests in property are blocked
pursuant to Executive Order 13448 of
October 18, 2007 (E.O. 13448),
Executive Order 13464 of April 30, 2008
(E.O. 13464), or Executive Order 13619
of July 11, 2012 (E.O. 13619), or by
§ 537.203. The exercise of rights under
a pre-May 21, 1997 agreement may
include the exercise of options to extend
the contract, depending on such factors
as the degree of specificity with which
the option to extend is described in the
pre-May 21, 1997 agreement and the
degree to which the party wishing to
renew can enforce its decision to
exercise the option, unless such exercise
of rights involves any activity
prohibited by § 537.201(a) with respect
to any person whose property and
interests in property are blocked
pursuant to E.O. 13448, E.O. 13464, or
E.O. 13619, or by § 537.203.
§ 537.410 Contracts and subcontracts
regarding economic development of
resources in Burma.
Section 537.204 prohibits new
investment in Burma by U.S. persons.
However, pursuant to § 537.530, U.S.
persons may engage in new investment
in Burma, provided that all conditions
of that general license are satisfied.
Section 537.311 defines the term new
investment to include certain contracts
providing for the general supervision
and guarantee of another person’s
performance of a contract that includes
the economic development of resources
located in Burma. With respect to entry
into such contracts, only the following
will be considered new investment in
Burma:
(a) Entry into contracts for
supervision and guarantee at the highest
level of project management, such as
entry into a contract with a
development project’s sponsor or owner
to become a prime contractor or general
manager for a development project;
(b) Entry into subcontracts where the
functional scope of the subcontractor’s
obligations is substantially similar to
that of a prime contractor’s or general
manager’s obligations for a development
project; or
E:\FR\FM\30JNR3.SGM
30JNR3
37116
Federal Register / Vol. 79, No. 125 / Monday, June 30, 2014 / Rules and Regulations
(c) Entry into a contract or subcontract
where the consideration includes a
share of ownership in, or participation
in the royalties, earnings, or profits of,
the economic development of resources
located in Burma.
§ 537.411
[Reserved]
§ 537.412 Investments in entities involved
in economic development projects in
Burma.
(a) The purchase of shares in a thirdcountry company that is engaged in the
economic development of resources
located in Burma is prohibited by
§ 537.204 where the company’s profits
are predominantly derived from the
company’s economic development of
resources located in Burma. The
purchase of such shares, however, is
authorized by general license pursuant
to § 537.530, provided that all
conditions of that general license are
satisfied.
(b) If a U.S. person holds shares in an
entity which subsequently engages
predominantly in the economic
development of resources located in
Burma or subsequently derives its
income exclusively or predominantly
from such economic development, the
U.S. person is not required to relinquish
its shares. Owning such shares, and
purchasing additional shares is
authorized by general license pursuant
to § 537.530, provided that all
conditions of that general license are
satisfied.
[Reserved]
§ 537.414
mstockstill on DSK4VPTVN1PROD with RULES3
§ 537.413
Charitable contributions.
Unless specifically authorized by
OFAC pursuant to this part, no
charitable contribution of funds, goods,
services, or technology, including
contributions to relieve human
suffering, such as food, clothing, or
medicine, may be made by, to, or for the
benefit of, or received from, a person
whose property and interests in
property are blocked pursuant to
§ 537.201(a). For the purposes of this
part, a contribution is made by, to, or for
the benefit of, or received from, a person
whose property and interests in
property are blocked pursuant to
§ 537.201(a) if made by, to, or in the
name of, or received from or in the
name of, such a person; if made by, to,
or in the name of, or received from or
in the name of, an entity or individual
acting for or on behalf of, or owned or
controlled by, such a person; or if made
in an attempt to violate, to evade, or to
avoid the bar on the provision of
contributions by, to, or for the benefit of
such a person, or the receipt of
contributions from such a person.
VerDate Mar<15>2010
20:32 Jun 27, 2014
Jkt 232001
§ 537.415 Credit extended and cards
issued by U.S. financial institutions to a
person whose property and interests in
property are blocked.
The prohibition in § 537.201 on
dealing in property subject to that
section prohibits U.S. financial
institutions from performing under any
existing credit agreements, including,
but not limited to, charge cards, debit
cards, or other credit facilities issued by
a U.S. financial institution to a person
whose property and interests in
property are blocked pursuant to
§ 537.201(a).
§ 537.416 Entities owned by a person
whose property and interests in property
are blocked.
A person whose property and
interests in property are blocked
pursuant to § 537.201(a) has an interest
in all property and interests in property
of an entity in which it owns, directly
or indirectly, a 50 percent or greater
interest. The property and interests in
property of such an entity, therefore, are
blocked, and such an entity is a person
whose property and interests in
property are blocked pursuant to
§ 537.201(a), regardless of whether the
name of the entity is incorporated into
OFAC’s Specially Designated Nationals
and Blocked Persons List (SDN List).
§ 537.417 Importation into a bonded
warehouse or foreign trade zone.
The prohibition in § 537.203 applies
to importation into a bonded warehouse
or a foreign trade zone of the United
States.
§ 537.418
Facilitating new investment.
Consistent with § 537.530, U.S.
persons may approve, finance, facilitate,
or guarantee new investment by foreign
persons provided such new investment
is not pursuant to an agreement, or
pursuant to the exercise of rights under
such an agreement, that:
(a) Is entered into with the Burmese
Ministry of Defense, state or non-state
armed groups (which includes the
military), or entities owned 50 percent
or more by any of the foregoing, or
(b) involves a transaction, directly or
indirectly, with any person whose
property and interests and property are
blocked pursuant to § 537.201(a).
Subpart E—Licenses, Authorizations,
and Statements of Licensing Policy
§ 537.501 General and specific licensing
procedures.
For provisions relating to licensing
procedures, see part 501, subpart E, of
this chapter. Licensing actions taken
pursuant to part 501 of this chapter with
respect to the prohibitions contained in
PO 00000
Frm 00012
Fmt 4701
Sfmt 4700
this part are considered actions taken
pursuant to this part. General licenses
and statements of licensing policy
relating to this part also may be
available through the Burma sanctions
page on OFAC’s Web site:
www.treasury.gov/ofac.
§ 537.502 Effect of license or
authorization.
(a) No license or other authorization
contained in this part, or otherwise
issued by OFAC, authorizes or validates
any transaction effected prior to the
issuance of such license or other
authorization, unless specifically
provided in such license or
authorization.
(b) No regulation, ruling, instruction,
or license authorizes any transaction
prohibited under this part unless the
regulation, ruling, instruction, or license
is issued by OFAC and specifically
refers to this part. No regulation, ruling,
instruction, or license referring to this
part shall be deemed to authorize any
transaction prohibited by any other part
of this chapter unless the regulation,
ruling, instruction, or license
specifically refers to such part.
(c) Any regulation, ruling, instruction,
or license authorizing any transaction
otherwise prohibited under this part has
the effect of removing a prohibition
contained in this part from the
transaction, but only to the extent
specifically stated by its terms. Unless
the regulation, ruling, instruction, or
license otherwise specifies, such an
authorization does not create any right,
duty, obligation, claim, or interest in, or
with respect to, any property which
would not otherwise exist under
ordinary principles of law.
(d) Nothing contained in this part
shall be construed to supersede the
requirements established under any
other provision of law or to relieve a
person from any requirement to obtain
a license or other authorization from
another department or agency of the
U.S. Government in compliance with
applicable laws and regulations subject
to the jurisdiction of that department or
agency. For example, exports of goods,
services, or technical data which are not
prohibited by this part or which do not
require a license by OFAC, nevertheless
may require authorization by the U.S.
Department of Commerce, the U.S.
Department of State, or other agencies of
the U.S. Government.
(e) No license or other authorization
contained in or issued pursuant to this
part authorizes transfers of or payments
from blocked property or debits to
blocked accounts unless the license or
other authorization explicitly authorizes
the transfer of or payment from blocked
E:\FR\FM\30JNR3.SGM
30JNR3
Federal Register / Vol. 79, No. 125 / Monday, June 30, 2014 / Rules and Regulations
property or the debit to a blocked
account.
(f) Any payment relating to a
transaction authorized in or pursuant to
this part that is routed through the U.S.
financial system should reference the
relevant OFAC general or specific
license authorizing the payment to
avoid the blocking or rejection of the
transfer.
§ 537.503
Exclusion from licenses.
OFAC reserves the right to exclude
any person, property, transaction, or
class thereof from the operation of any
license or from the privileges conferred
by any license. OFAC also reserves the
right to restrict the applicability of any
license to particular persons, property,
transactions, or classes thereof. Such
actions are binding upon actual or
constructive notice of the exclusions or
restrictions.
§ 537.504 Payments and transfers to
blocked accounts in U.S. financial
institutions.
Any payment of funds or transfer of
credit in which a person whose property
and interests in property are blocked
pursuant to § 537.201(a) has any interest
that comes within the possession or
control of a U.S. financial institution
must be blocked in an account on the
books of that financial institution. A
transfer of funds or credit by a U.S.
financial institution between blocked
accounts in its branches or offices is
authorized, provided that no transfer is
made from an account within the
United States to an account held outside
the United States, and further provided
that a transfer from a blocked account
may be made only to another blocked
account held in the same name.
Note to § 537.504: See § 501.603 of this
chapter for mandatory reporting
requirements regarding financial transfers.
See also § 537.208 concerning the obligation
to hold blocked funds in interest-bearing
accounts.
mstockstill on DSK4VPTVN1PROD with RULES3
§ 537.505 Entries in certain accounts for
normal service charges authorized.
(a) A U.S. financial institution is
authorized to debit any blocked account
held at that financial institution in
payment or reimbursement for normal
service charges owed it by the owner of
that blocked account.
(b) As used in this section, the term
normal service charges shall include
charges in payment or reimbursement
for interest due; cable, telegraph,
internet, or telephone charges; postage
costs; custody fees; small adjustment
charges to correct bookkeeping errors;
and, but not by way of limitation,
minimum balance charges, notary and
VerDate Mar<15>2010
20:32 Jun 27, 2014
Jkt 232001
protest fees, and charges for reference
books, photocopies, credit reports,
transcripts of statements, registered
mail, insurance, stationery and supplies,
and other similar items.
§ 537.506 Investment and reinvestment of
certain funds.
Subject to the requirements of
§ 537.208, U.S. financial institutions are
authorized to invest and reinvest assets
blocked pursuant to § 537.201(a),
subject to the following conditions:
(a) The assets representing such
investments and reinvestments are
credited to a blocked account or
subaccount that is held in the same
name at the same U.S. financial
institution, or within the possession or
control of a U.S. person, but funds shall
not be transferred outside the United
States for this purpose;
(b) The proceeds of such investments
and reinvestments shall not be credited
to a blocked account or subaccount
under any name or designation that
differs from the name or designation of
the specific blocked account or
subaccount in which such funds or
securities were held; and
(c) No immediate financial or
economic benefit accrues (e.g., through
pledging or other use) to a person whose
property and interests in property are
blocked pursuant to § 537.201(a).
§ 537.507 Provision of certain legal
services authorized.
(a) The provision of the following
legal services to or on behalf of persons
whose property and interests in
property are blocked pursuant to
§ 537.201(a) is authorized, provided that
receipt of payment of professional fees
and reimbursement of incurred
expenses must be specifically licensed
or otherwise authorized pursuant to
§ 537.528:
(1) Provision of legal advice and
counseling on the requirements of and
compliance with the laws of the United
States or any jurisdiction within the
United States, provided that such advice
and counseling are not provided to
facilitate transactions in violation of this
part;
(2) Representation of persons named
as defendants in or otherwise made
parties to legal, arbitration, or
administrative proceedings before any
U.S. federal, state, or local court or
agency;
(3) Initiation and conduct of legal,
arbitration, or administrative
proceedings before any U.S. federal,
state, or local court or agency;
(4) Representation of persons before
any U.S. federal, state, or local court or
agency with respect to the imposition,
PO 00000
Frm 00013
Fmt 4701
Sfmt 4700
37117
administration, or enforcement of U.S.
sanctions against such persons; and
(5) Provision of legal services in any
other context in which prevailing U.S.
law requires access to legal counsel at
public expense.
(b) The provision of any other legal
services to persons whose property and
interests in property are blocked
pursuant to § 537.201(a), not otherwise
authorized in this part, requires the
issuance of a specific license.
(c) Entry into a settlement agreement
or the enforcement of any lien,
judgment, arbitral award, decree, or
other order through execution,
garnishment, or other judicial process
purporting to transfer or otherwise alter
or affect property or interests in
property blocked pursuant to
§ 537.201(a) is prohibited unless
licensed pursuant to this part.
Note to § 537.507: U.S. persons seeking
administrative reconsideration or judicial
review of their designation or the blocking of
their property and interests in property may
apply for a specific license from OFAC to
authorize the release of a limited amount of
blocked funds for the payment of legal fees
where alternative funding sources are not
available. For more information, see OFAC’s
Guidance on the Release of Limited Amounts
of Blocked Funds for Payment of Legal Fees
and Costs Incurred in Challenging the
Blocking of U.S. Persons in Administrative or
Civil Proceedings, which is available on
OFAC’s Web site: www.treasury.gov/ofac.
§ 537.508 Authorization of emergency
medical services.
The provision of nonscheduled
emergency medical services in the
United States to persons whose property
and interests in property are blocked
pursuant to § 537.201(a) is authorized,
provided that all receipt of payment for
such services must be specifically
licensed.
§ 537.509 Official activities of certain
international organizations authorized.
All transactions and activities
otherwise prohibited by this part that
are for the conduct of the official
business of the United Nations or the
Specialized Agencies, Programmes,
Funds, and Related Organizations of the
United Nations by employees,
contractors, or grantees thereof are
authorized.
Note to § 537.509: For an organizational
chart listing the Specialized Agencies,
Programmes, Funds, and Related
Organizations of the United Nations, see the
following page on the United Nations Web
site: www.un.org/en/aboutun/structure/pdfs/
un-system-chart-color-sm.pdf.
E:\FR\FM\30JNR3.SGM
30JNR3
37118
Federal Register / Vol. 79, No. 125 / Monday, June 30, 2014 / Rules and Regulations
§§ 537.510–537.518
[Reserved]
§ 537.519 Activities undertaken pursuant
to certain pre-May 21, 1997 agreements.
Except as prohibited by § 537.201(a)
with respect to persons whose property
and interests in property are blocked
pursuant to Executive Order 13448 of
October 18, 2007, Executive Order
13464 of April 30, 2008, or Executive
Order 13619 of July 11, 2012, or by
§ 537.203, U.S. persons are authorized
to engage in any activity, or any
transaction incident to an activity,
undertaken pursuant to an agreement
entered into prior to 12:01 a.m., eastern
daylight time, on May 21, 1997, or
pursuant to the exercise of rights under
such an agreement, provided that the
parties to the agreement include:
(a) The Government of Burma or a
nongovernmental entity in Burma, and
(b) An entity organized under the
laws of a foreign state.
Note to § 537.519: The authorization
contained in this section pertains to pre-May
21, 1997 contracts between foreign entities
and either the Government of Burma or a
nongovernmental entity in Burma. A parallel
exemption for pre-May 21, 1997 contracts
between U.S. persons and the Government of
Burma or a nongovernmental entity in Burma
is contained in § 537.210(d) and further
explained in § 537.409.
§§ 537.520–537.521
[Reserved]
mstockstill on DSK4VPTVN1PROD with RULES3
§ 537.522 Certain transactions related to
patents, trademarks, copyrights, and other
intellectual property authorized.
(a) All of the following transactions in
connection with patent, trademark,
copyright, or other intellectual property
protection in the United States or Burma
are authorized:
(1) The filing and prosecution of any
application to obtain a patent,
trademark, copyright, or other form of
intellectual property protection;
(2) The receipt of a patent, trademark,
copyright, or other form of intellectual
property protection;
(3) The renewal or maintenance of a
patent, trademark, copyright, or other
form of intellectual property protection;
(4) The filing and prosecution of
opposition or infringement proceedings
with respect to a patent, trademark,
copyright, or other form of intellectual
property protection, or the entrance of a
defense to any such proceedings; and
(5) The assignment or transfer of a
patent, trademark, copyright, or other
form of intellectual property protection.
(b) This section authorizes the
payment of fees currently due to the
United States Government or the
Government of Burma, or of the
reasonable and customary fees and
charges currently due to attorneys or
VerDate Mar<15>2010
20:32 Jun 27, 2014
Jkt 232001
representatives within the United States
or Burma, in connection with the
transactions authorized in paragraph (a)
of this section, except that payment
effected pursuant to the terms of this
paragraph may not be made from a
blocked account.
(f) Creating or undertaking a
marketing campaign to promote a
written publication; and
(g) Other transactions necessary and
ordinarily incident to the publishing
and marketing of written publications as
described in this section.
§§ 537.523–537.525
Note 1 to § 537.526: The Department of
State has determined that the State Peace and
Development Council of Burma no longer
exists.
[Reserved]
§ 537.526 Transactions necessary and
ordinarily incident to publishing authorized.
To the extent that such activities are
not exempt from this part, U.S. persons
are authorized to engage in all
transactions otherwise prohibited by
§ 537.201 that are necessary and
ordinarily incident to the publishing
and marketing of manuscripts, books,
journals, and newspapers in paper or
electronic format (collectively, ‘‘written
publications’’). This section does not
apply if the parties to the transactions
described in this paragraph include the
State Peace and Development Council of
Burma or the Union Solidarity and
Development Association of Burma; any
successor entity to any of the foregoing
entities; or any person, other than
personnel of academic and research
institutions, acting or purporting to act
directly or indirectly on behalf of the
foregoing entities with respect to the
transactions described in this paragraph.
Pursuant to this section, transactions
incident to the following activities are
authorized, provided they do not
involve any importations prohibited by
§ 537.203:
(a) Commissioning and making
advance payments for identifiable
written publications not yet in
existence, to the extent consistent with
industry practice;
(b) Collaborating on the creation and
enhancement of written publications;
(c)(1) Augmenting written
publications through the addition of
items such as photographs, artwork,
translation, explanatory text, and, for a
written publication in electronic format,
the addition of embedded software
necessary for reading, browsing,
navigating, or searching the written
publication;
(2) Exporting embedded software
necessary for reading, browsing,
navigating, or searching a written
publication in electronic format,
provided that, to the extent a license is
required under the Export
Administration Regulations, 15 CFR
parts 730–774 (EAR), the exportation is
licensed or otherwise authorized by the
Department of Commerce under the
provisions of the EAR;
(d) Substantive editing of written
publications;
(e) Payment of royalties for written
publications;
PO 00000
Frm 00014
Fmt 4701
Sfmt 4700
Note 2 to § 537.526: See § 537.529 for a
general license authorizing the exportation or
reexportation of financial services to Burma.
§ 537.527
[Reserved]
§ 537.528 Payments for legal services from
funds originating outside the United States
authorized.
Receipts of payment of professional
fees and reimbursement of incurred
expenses for the provision of legal
services authorized pursuant to
§ 537.507(a) to or on behalf of any
person whose property and interests in
property are blocked pursuant to
§ 537.201(a) are authorized from funds
originating outside the United States,
provided that:
(a) Prior to receiving payment for legal
services authorized pursuant to
§ 537.507(a) rendered to persons whose
property and interests in property are
blocked pursuant to § 537.201(a), the
U.S. person that is an attorney, law firm,
or legal services organization provides
to OFAC a copy of a letter of
engagement or a letter of intent to
engage specifying the services to be
performed and signed by the individual
to whom such services are to be
provided or, where services are to be
provided to an entity, by a legal
representative of the entity. The copy of
a letter of engagement or a letter of
intent to engage, accompanied by
correspondence referencing this
paragraph (a), is to be mailed to:
Licensing Division, Office of Foreign
Assets Control, U.S. Department of the
Treasury, 1500 Pennsylvania Avenue
NW., Annex, Washington, DC 20220;
(b) The funds received by U.S.
persons as payment of professional fees
and reimbursement of incurred
expenses for the provision of legal
services authorized pursuant to
§ 537.507(a) must not originate from:
(1) A source within the United States;
(2) Any source, wherever located,
within the possession or control of a
U.S. person; or
(3) Any individual or entity, other
than the person on whose behalf the
legal services authorized pursuant to
§ 537.507(a) are to be provided, whose
property and interests in property are
E:\FR\FM\30JNR3.SGM
30JNR3
Federal Register / Vol. 79, No. 125 / Monday, June 30, 2014 / Rules and Regulations
blocked pursuant to any part of this
chapter or any Executive order;
Note to § 537.528(b): This paragraph
authorizes the blocked person on whose
behalf the legal services authorized pursuant
to § 537.507(a) are to be provided to make
payments for authorized legal services using
funds originating outside the United States
that were not previously blocked. Nothing in
this paragraph authorizes payments for legal
services using funds in which any other
person whose property and interests in
property are blocked pursuant to
§ 537.201(a), any other part of this chapter, or
any Executive order holds an interest.
(c) Reports. (1) U.S. persons who
receive payments in connection with
legal services authorized pursuant to
§ 537.507(a) must submit quarterly
reports no later than 30 days following
the end of the calendar quarter during
which the payments were received
providing information on the funds
received. Such reports shall specify:
(i) The individual or entity from
whom the funds originated and the
amount of funds received; and
(ii) If applicable:
(A) The names of any individuals or
entities providing related services to the
U.S. person receiving payment in
connection with authorized legal
services, such as private investigators or
expert witnesses;
(B) A general description of the
services provided; and
(C) The amount of funds paid in
connection with such services.
(2) In the event that no transactions
occur or no funds are received during
the reporting period, a statement is to be
filed to that effect; and
(3) The reports, which must reference
this section, are to be mailed to:
Licensing Division, Office of Foreign
Assets Control, U.S. Department of the
Treasury, 1500 Pennsylvania Avenue
NW., Annex, Washington, DC 20220.
mstockstill on DSK4VPTVN1PROD with RULES3
Note to § 537.528: U.S. persons who
receive payments in connection with legal
services authorized pursuant to § 537.507(a)
do not need to obtain specific authorization
to contract for related services that are
ordinarily incident to the provision of those
legal services, such as those provided by
private investigators or expert witnesses, or
to pay for such services. Additionally, U.S.
persons do not need to obtain specific
authorization to provide related services that
are ordinarily incident to the provision of
legal services authorized pursuant to
§ 537.507(a).
§ 537.529 Exportation or reexportation of
financial services to Burma authorized.
(a) Except as provided in paragraphs
(b)–(d) of this section, the exportation or
reexportation of financial services to
Burma, directly or indirectly, from the
United States or by a U.S. person,
wherever located, is authorized.
VerDate Mar<15>2010
20:32 Jun 27, 2014
Jkt 232001
37119
(b) This section does not authorize, in
connection with the provision of
security services, the exportation or
reexportation of financial services,
directly or indirectly, to the Burmese
Ministry of Defense, including the
Office of Procurement; any state or nonstate armed group; or any entity in
which any of the foregoing own a 50
percent or greater interest.
(c) This section does not authorize the
exportation or reexportation of financial
services, directly or indirectly, to any
person whose property and interests in
property are blocked pursuant to
§ 537.201(a), except as set forth in
§ 537.404(b).
www.HumanRights.gov/
BurmaResponsibleInvestment.
(c) This section does not authorize
new investment undertaken pursuant to
an agreement, or pursuant to the
exercise of rights under such an
agreement, that is entered into with the
Burmese Ministry of Defense, including
the Office of Procurement; any state or
non-state armed group; or any entity in
which any of the foregoing own a 50
percent or greater interest.
(d) This section does not authorize
transactions with, directly or indirectly,
any person whose property and interests
in property are blocked pursuant to
§ 537.201(a).
Note to § 537.529(c): See § 537.531 for a
general license authorizing transactions
involving certain Burmese financial
institutions whose property and interests in
property are blocked pursuant to
§ 537.201(a), including establishing and
maintaining accounts on the books of U.S.
financial institutions.
Note to § 537.530: The Department of State,
pursuant to section 570(e) of the Foreign
Operations, Export Financing, and Related
Programs Appropriations Act, 1997 (Pub. L.
104–208) and a delegation of authority by the
President, has waived the prohibition on new
investment in Burma authorized in section
570 of that act. See 77 Fed. Reg. 62596 (Oct.
15, 2012).
(d) This section does not authorize
any debit to a blocked account.
Note to § 537.529: As a result of the
authorization contained in this section, the
special measures against Burma imposed
under Section 311 of the Uniting and
Strengthening America by Providing
Appropriate Tools Required to Intercept and
Obstruct Terrorism (USA PATRIOT) Act of
2001 (Pub. L. 107–56) (USA PATRIOT Act)
do not apply to the operation of
correspondent accounts for Burmese
financial institutions, or to transactions that
are conducted through those accounts,
provided the Burmese financial institution is
not an entity whose property and interests in
property are blocked pursuant to § 537.201(a)
and the transactions are otherwise authorized
by this part, and therefore fall within the
exception set forth in 31 CFR 1010.651(b)(3).
In addition, section 537.531 of this part
authorizes certain transactions involving
specific Burmese financial institutions whose
property and interests in property are
blocked pursuant to this part. This section
does not affect any obligation of U.S.
financial institutions processing such
transactions to conduct enhanced due
diligence under Section 312 of the USA
PATRIOT Act. See 31 CFR 1010.610(c).
§ 537.530 New investment in Burma by
U.S. persons authorized.
(a) Except as provided in paragraphs
(c) and (d) of this section, new
investment, as defined in § 537.311, in
Burma by U.S. persons is authorized.
(b) Any U.S. person engaging in new
investment in Burma pursuant to this
section must report to the Department of
State in compliance with the
requirements set forth in the
Department of State’s ‘‘Reporting
Requirements on Responsible
Investment in Burma,’’ available at:
PO 00000
Frm 00015
Fmt 4701
Sfmt 4700
§ 537.531 Certain transactions involving
Asia Green Development Bank, Ayeyarwady
Bank, Myanma Economic Bank, and
Myanma Investment and Commercial Bank
authorized.
(a) Except as provided in paragraphs
(b) through (f) of this section, all
transactions involving Asia Green
Development Bank, Ayeyarwady Bank,
Myanma Economic Bank, and Myanma
Investment and Commercial Bank are
authorized.
(b) This section does not authorize
transactions involving any person
whose property and interests in
property are blocked pursuant to
§ 537.201(a) other than Asia Green
Development Bank, Ayeyarwady Bank,
Myanma Economic Bank, and Myanma
Investment and Commercial Bank.
(c) This section does not authorize, in
connection with the provision of
security services, the exportation or
reexportation of financial services,
directly or indirectly, to the Burmese
Ministry of Defense, including the
Office of Procurement; any state or nonstate armed group; or any entity in
which any of the foregoing own a 50
percent or greater interest.
(d) This section does not authorize
any new investment, as defined in
§ 537.311, including in or with Asia
Green Development Bank, Ayeyarwady
Bank, Myanma Economic Bank, or
Myanma Investment and Commercial
Bank.
(e) This section does not authorize
any importations into the United States
prohibited by § 537.203.
(f) This section does not authorize the
unblocking of any property and interests
E:\FR\FM\30JNR3.SGM
30JNR3
37120
Federal Register / Vol. 79, No. 125 / Monday, June 30, 2014 / Rules and Regulations
in property that were blocked as of
February 22, 2013, pursuant to 31 CFR
§ 537.201(a), Executive Order 13448 of
October 18, 2007, Executive Order
13464 of April 30, 2008, or Executive
Order 13619 of July 11, 2012.
Note to § 537.531: As a result of the
authorization contained in this section, the
special measures against Burma imposed
under Section 311 of the Uniting and
Strengthening America by Providing
Appropriate Tools Required to Intercept and
Obstruct Terrorism (USA PATRIOT) Act of
2001 (Pub. L. 107–56) (USA PATRIOT Act)
do not apply to the operation of
correspondent accounts for Asia Green
Development Bank, Ayeyarwady Bank,
Myanma Economic Bank, and Myanma
Investment and Commercial Bank, or to
transactions conducted through such
accounts, provided the transactions are
authorized pursuant to this part, and
therefore fall within the exception set forth
in 31 CFR 1010.651(b)(3). This section does
not affect any obligation of U.S. financial
institutions processing such transactions to
conduct enhanced due diligence under
Section 312 of the USA PATRIOT Act. See
31 CFR 1010.610(c).
Subpart F—Reports
§ 537.601
Records and reports.
For provisions relating to required
records and reports, see part 501,
subpart C, of this chapter.
Recordkeeping and reporting
requirements imposed by part 501 of
this chapter with respect to the
prohibitions contained in this part are
considered requirements arising
pursuant to this part.
Subpart G—Penalties
mstockstill on DSK4VPTVN1PROD with RULES3
§ 537.701
Penalties.
(a) Attention is directed to section 206
of the International Emergency
Economic Powers Act (50 U.S.C. 1705)
(IEEPA), which is applicable to
violations of the provisions of any
license, ruling, regulation, order,
directive, or instruction issued by or
pursuant to the direction or
authorization of the Secretary of the
Treasury pursuant to this part or
otherwise under IEEPA.
(1) A civil penalty not to exceed the
amount set forth in section 206 of IEEPA
may be imposed on any person who
violates, attempts to violate, conspires
to violate, or causes a violation of any
license, order, regulation, or prohibition
issued under IEEPA.
Note to § 537.701(a)(1): As of the date of
publication in the Federal Register of the
final rule amending and reissuing this part
(June 30, 2014), IEEPA provides for a
maximum civil penalty not to exceed the
greater of $250,000 or an amount that is twice
the amount of the transaction that is the basis
VerDate Mar<15>2010
20:32 Jun 27, 2014
Jkt 232001
of the violation with respect to which the
penalty is imposed.
(2) A person who willfully commits,
willfully attempts to commit, or
willfully conspires to commit, or aids or
abets in the commission of a violation
of any license, order, regulation, or
prohibition may, upon conviction, be
fined not more than $1,000,000, or if a
natural person, be imprisoned for not
more than 20 years, or both.
(b) Adjustments to penalty amounts.
(1) The civil penalties provided in
IEEPA are subject to adjustment
pursuant to the Federal Civil Penalties
Inflation Adjustment Act of 1990 (Pub.
L. 101–410, as amended, 28 U.S.C. 2461
note).
(2) The criminal penalties provided in
IEEPA are subject to adjustment
pursuant to 18 U.S.C. 3571.
(c) Attention is also directed to 18
U.S.C. 1001, which provides that
whoever, in any matter within the
jurisdiction of the executive, legislative,
or judicial branch of the Government of
the United States, knowingly and
willfully falsifies, conceals, or covers up
by any trick, scheme, or device a
material fact, or makes any materially
false, fictitious, or fraudulent statement
or representation, or makes or uses any
false writing or document knowing the
same to contain any materially false,
fictitious, or fraudulent statement or
entry shall be fined under title 18,
United States Code, or imprisoned, or
both.
(d) Violations of this part may also be
subject to other applicable laws.
Note to § 537.701: The Tom Lantos Block
Burmese JADE (Junta’s Anti-Democratic
Efforts) Act of 2008 (the ‘‘JADE Act’’)
provides that any person who violates any
prohibition imposed pursuant to Section 5(b)
of the JADE Act shall be subject to the
penalties provided in IEEPA. In Executive
Order 13651 of August 6, 2013, the President
waived pursuant to Section 5(i) of JADE Act
the blocking and financial sanctions
described in Section 5(b) of the JADE Act.
§ 537.702
Pre-Penalty Notice; settlement.
(a) When required. If OFAC has
reason to believe that there has occurred
a violation of any provision of this part
or a violation of the provisions of any
license, ruling, regulation, order,
direction, or instruction issued by or
pursuant to the direction or
authorization of the Secretary of the
Treasury pursuant to this part or
otherwise under the International
Emergency Economic Powers Act (50
U.S.C. 1705) (IEEPA) and determines
that a civil monetary penalty is
warranted, OFAC will issue a PrePenalty Notice informing the alleged
violator of the agency’s intent to impose
PO 00000
Frm 00016
Fmt 4701
Sfmt 4700
a monetary penalty. A Pre-Penalty
Notice shall be in writing. The PrePenalty Notice may be issued whether
or not another agency has taken any
action with respect to the matter. For a
description of the contents of a PrePenalty Notice, see Appendix A to part
501 of this chapter.
(b)(1) Right to respond. An alleged
violator has the right to respond to a
Pre-Penalty Notice by making a written
presentation to OFAC. For a description
of the information that should be
included in such a response, see
Appendix A to part 501 of this chapter.
(2) Deadline for response. A response
to a Pre-Penalty Notice must be made
within the applicable 30-day period set
forth in this paragraph. The failure to
submit a response within the applicable
time period set forth in this paragraph
shall be deemed to be a waiver of the
right to respond.
(i) Computation of time for response.
A response to a Pre-Penalty Notice must
be postmarked or date-stamped by the
U.S. Postal Service (or foreign postal
service, if mailed abroad) or courier
service provider (if transmitted to OFAC
by courier) on or before the 30th day
after the postmark date on the envelope
in which the Pre-Penalty Notice was
mailed. If the Pre-Penalty Notice was
personally delivered by a non-U.S.
Postal Service agent authorized by
OFAC, a response must be postmarked
or date-stamped on or before the 30th
day after the date of delivery.
(ii) Extensions of time for response. If
a due date falls on a federal holiday or
weekend, that due date is extended to
include the following business day. Any
other extensions of time will be granted,
at the discretion of OFAC, only upon
specific request to OFAC.
(3) Form and method of response. A
response to a Pre-Penalty Notice need
not be in any particular form, but it
must be typewritten and signed by the
alleged violator or a representative
thereof, must contain information
sufficient to indicate that it is in
response to the Pre-Penalty Notice, and
must include the OFAC identification
number listed on the Pre-Penalty Notice.
A copy of the written response may be
sent by facsimile, but the original also
must be sent to OFAC’s Enforcement
Division by mail or courier and must be
postmarked or date-stamped in
accordance with paragraph (b)(2) of this
section.
(c) Settlement. Settlement discussion
may be initiated by OFAC, the alleged
violator, or the alleged violator’s
authorized representative. For a
description of practices with respect to
settlement, see Appendix A to part 501
of this chapter.
E:\FR\FM\30JNR3.SGM
30JNR3
Federal Register / Vol. 79, No. 125 / Monday, June 30, 2014 / Rules and Regulations
(d) Guidelines. Guidelines for the
imposition or settlement of civil
penalties by OFAC are contained in
Appendix A to part 501 of this chapter.
(e) Representation. A representative of
the alleged violator may act on behalf of
the alleged violator, but any oral
communication with OFAC prior to a
written submission regarding the
specific allegations contained in the PrePenalty Notice must be preceded by a
written letter of representation, unless
the Pre-Penalty Notice was served upon
the alleged violator in care of the
representative.
§ 537.704 Administrative collection;
referral to United States Department of
Justice.
§ 537.703
For license application procedures
and procedures relating to amendments,
modifications, or revocations of
licenses; administrative decisions;
rulemaking; and requests for documents
pursuant to the Freedom of Information
and Privacy Acts (5 U.S.C. 552 and
552a), see part 501, subpart E, of this
chapter.
Penalty imposition.
mstockstill on DSK4VPTVN1PROD with RULES3
If, after considering any written
response to the Pre-Penalty Notice and
any relevant facts, OFAC determines
that there was a violation by the alleged
violator named in the Pre-Penalty
Notice and that a civil monetary penalty
is appropriate, OFAC may issue a
Penalty Notice to the violator containing
a determination of the violation and the
imposition of the monetary penalty. For
additional details concerning issuance
of a Penalty Notice, see Appendix A to
part 501 of this chapter. The issuance of
the Penalty Notice shall constitute final
agency action. The violator has the right
to seek judicial review of that final
agency action in federal district court.
VerDate Mar<15>2010
20:32 Jun 27, 2014
Jkt 232001
In the event that the violator does not
pay the penalty imposed pursuant to
this part or make payment arrangements
acceptable to OFAC, the matter may be
referred for administrative collection
measures by the Department of the
Treasury or to the United States
Department of Justice for appropriate
action to recover the penalty in a civil
suit in a federal district court.
Subpart H—Procedures
§ 537.801
Procedures.
§ 537.802 Delegation by the Secretary of
the Treasury.
Any action that the Secretary of the
Treasury is authorized to take pursuant
to the Tom Lantos Block Burmese JADE
(Junta’s Anti-Democratic Efforts) Act of
2008 (Pub. L. 110–286); Executive Order
13047 of May 20, 1997, Executive Order
13310 of July 28, 2003, Executive Order
13448 of October 18, 2007, Executive
Order 13464 of April 30, 2008,
Executive Order 13619 of July 11, 2012,
PO 00000
Frm 00017
Fmt 4701
Sfmt 9990
37121
Executive Order 13651 of August 6,
2013, and any further Executive orders
relating to the national emergency
declared in Executive Order 13047, may
be taken by the Director of OFAC or by
any other person to whom the Secretary
of the Treasury has delegated authority
so to act.
Subpart I—Paperwork Reduction Act
§ 537.901
Paperwork Reduction Act notice.
For approval by the Office of
Management and Budget (OMB) under
the Paperwork Reduction Act of 1995
(44 U.S.C. 3507) of information
collections relating to recordkeeping
and reporting requirements, licensing
procedures (including those pursuant to
statements of licensing policy), and
other procedures, see § 501.901 of this
chapter. An agency may not conduct or
sponsor, and a person is not required to
respond to, a collection of information
unless it displays a valid control
number assigned by OMB.
Dated: June 18, 2014.
Barbara C. Hammerle,
Acting Director, Office of Foreign Assets
Control.
Approved: June 18, 2014.
David S. Cohen,
Under Secretary, Office of Terrorism and
Financial Intelligence, Department of the
Treasury.
[FR Doc. 2014–14841 Filed 6–25–14; 4:15 pm]
BILLING CODE 4810–AL–P
E:\FR\FM\30JNR3.SGM
30JNR3
Agencies
[Federal Register Volume 79, Number 125 (Monday, June 30, 2014)]
[Rules and Regulations]
[Pages 37105-37121]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-14841]
[[Page 37105]]
Vol. 79
Monday,
No. 125
June 30, 2014
Part IV
Department of the Treasury
-----------------------------------------------------------------------
Office of Foreign Assets Control
-----------------------------------------------------------------------
31 CFR Part 537
Burmese Sanctions Regulations; Final Rule
Federal Register / Vol. 79, No. 125 / Monday, June 30, 2014 / Rules
and Regulations
[[Page 37106]]
-----------------------------------------------------------------------
DEPARTMENT OF THE TREASURY
Office of Foreign Assets Control
31 CFR Part 537
Burmese Sanctions Regulations
AGENCY: Office of Foreign Assets Control, Treasury.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: The Department of the Treasury's Office of Foreign Assets
Control (OFAC) is amending and reissuing in their entirety the Burmese
Sanctions Regulations to implement Executive Order 13448 of October 18,
2007, ``Blocking Property and Prohibiting Certain Transactions Related
to Burma,'' Executive Order 13464 of April 30, 2008, ``Blocking
Property and Prohibiting Certain Transactions Related to Burma,''
Executive Order 13619 of July 11, 2012, ``Blocking Property of Persons
Threatening the Peace, Security, or Stability of Burma,'' and Executive
Order 13651 of August 6, 2013, ``Prohibiting Certain Imports of Burmese
Jadeite and Rubies.''
DATES: Effective: June 30, 2014.
FOR FURTHER INFORMATION CONTACT: Assistant Director for Licensing,
tel.: 202-622-2480, Assistant Director for Policy, tel.: 202-622-2746,
Assistant Director for Regulatory Affairs, tel.: 202-622-4855,
Assistant Director for Sanctions Compliance & Evaluation, tel.: 202-
622-2490, Office of Foreign Assets Control, or Chief Counsel (Foreign
Assets Control), tel.: 202-622-2410, Office of the General Counsel,
Department of the Treasury (not toll free numbers).
SUPPLEMENTARY INFORMATION:
Electronic and Facsimile Availability
This document and additional information concerning OFAC are
available from OFAC's Web site (www.treasury.gov/ofac). Certain general
information pertaining to OFAC's sanctions programs also is available
via facsimile through a 24-hour fax-on-demand service, tel.: 202-622-
0077.
Background
On May 20, 1997, the President issued Executive Order 13047 (62 FR
28301, May 22, 1997) (E.O. 13047), determining that the Government of
Burma, then ruled by a military junta, had committed large-scale
repression of the democratic opposition in Burma and declaring a
national emergency to deal with the unusual and extraordinary threat
posed by the actions and policies of that government. E.O. 13047,
issued under the authority of, inter alia, section 570 of the Foreign
Operations, Export Financing, and Related Programs Appropriations Act,
1997 (Pub. L. 104-208) (section 570), and the International Emergency
Economic Powers Act (50 U.S.C. 1701-1706) (IEEPA), prohibits new
investment in Burma by a U.S. person and any facilitation by a U.S.
person of new investment in Burma by a foreign person. Section 570
provides the President with the authority to waive the new investment
prohibition in that section in the national security interests of the
United States.
On July 28, 2003, the President signed into law the Burmese Freedom
and Democracy Act of 2003 (Pub. L. 108-61) (BFDA) to further sanction
the military junta then ruling Burma. The BFDA required the imposition,
subject to annual renewal, of a ban on the importation into the United
States of any article that is a product of Burma. To implement the BFDA
and to take additional steps with respect to the national emergency
declared in E.O. 13047, the President issued Executive Order 13310 (68
FR 44853, July 30, 2003) (E.O. 13310), also on July 28, 2003. E.O.
13310 blocks, with certain exceptions, all property and interests in
property of the persons listed in its Annex and persons determined by
the Secretary of the Treasury, in consultation with the Secretary of
State, to meet the criteria set forth in E.O. 13310. E.O. 13310 also
prohibits the exportation or reexportation to Burma of financial
services from the United States or by a U.S. person, except as
exempted, licensed, or authorized. While E.O. 13310 also prohibited the
importation into the United States of any article that is a product of
Burma, that prohibition has been revoked, as discussed in more detail
below.
On October 18, 2007, the President issued Executive Order 13448 (72
FR 60223, October 23, 2007) (E.O. 13448), expanding the scope of the
national emergency declared in E.O. 13047 and blocking, with certain
exceptions, all property and interests in property of the persons
listed in the Annex to E.O. 13448 and persons determined by the
Secretary of the Treasury, after consultation with the Secretary of
State, to meet the criteria set forth in E.O. 13448.
In order to take additional steps with respect to the national
emergency declared in E.O. 13047 and expanded in E.O. 13448, the
President issued Executive Order 13464 (73 FR 24491, May 2, 2008) (E.O.
13464) on April 30, 2008. E.O. 13464 blocks all property and interests
in property of the persons listed in its Annex and persons determined
by the Secretary of the Treasury, after consultation with the Secretary
of State, to meet the criteria set forth in E.O. 13464.
On July 29, 2008, the President signed into law the Tom Lantos
Block Burmese JADE (Junta's Anti-Democratic Efforts) Act of 2008 (Pub.
L. 110-286) (JADE Act), which, among other things, imposes mandatory
blocking and financial sanctions on certain categories of persons
described in the JADE Act. The JADE Act also amended the BFDA to
require a prohibition on the importation into the United States of
jadeite or rubies mined or extracted from Burma and articles of jewelry
containing such jadeite or rubies and the imposition of certain
conditions on the importation into the United States of jadeite or
rubies mined or extracted from a country other than Burma and articles
of jewelry containing such jadeite or rubies. The importation
provisions of the BFDA, as amended by the JADE Act, required annual
renewal, which did not occur in 2013.
On July 11, 2012, the President issued Executive Order 13619 (77 FR
41243, July 13, 2012) (E.O. 13619), modifying the scope of the national
emergency declared in E.O. 13047 and blocking all property and
interests in property of persons determined by the Secretary of the
Treasury, in consultation with or at the recommendation of the
Secretary of State, to meet the criteria set forth in E.O. 13619.
Also on July 11, 2012, in response to historic reforms in Burma,
the U.S. Government took a number of steps to authorize new U.S.
investment in Burma and the exportation or reexportation of U.S.
financial services to Burma. OFAC issued and made available on its Web
site a general license authorizing the exportation or reexportation of
financial services to Burma from the United States or by a U.S. person,
subject to certain limitations. The Department of State, pursuant to a
delegation of authority from the President, waived the ban on new U.S.
investment in Burma set forth in section 570. Consistent with this
waiver, OFAC issued and made available on its Web site a general
license authorizing new investment in Burma, subject to certain
limitations and requirements.
The Department of State, pursuant to a delegation of authority from
the President, subsequently waived the importation prohibitions set
forth in section 3(a) of the BFDA. Consistent with this waiver, on
November 16, 2012, OFAC issued and made available on its Web site a
general license authorizing the importation into the United States of
any article that is a product of Burma,
[[Page 37107]]
subject to certain limitations. This general license did not authorize
the importation into the United States of jadeite and rubies and of
articles of jewelry containing them, which continued to be prohibited.
On February 22, 2013, OFAC issued and made available on its Web
site a general license authorizing U.S. persons to conduct most
transactions, including opening and maintaining accounts and conducting
other financial services involving four of Burma's major financial
institutions included on OFAC's Specially Designated Nationals and
Blocked Persons List (SDN List): Asia Green Development Bank,
Ayeyarwady Bank, Myanma Economic Bank, and Myanma Investment and
Commercial Bank.
On August 6, 2013, in light of the expiration of the BFDA
importation ban, as amended by the JADE Act, the President issued
Executive Order 13651 (78 FR 48793, August 9, 2013) (E.O. 13651)
revoking the provisions of E.O. 13310 implementing the broad ban on
importation of products of Burma. However, due to continuing concerns,
including with respect to labor and human rights in specific sectors,
E.O. 13651 reinstates the prohibition that was originally imposed by
the JADE Act amendments to the BFDA on the importation into the United
States of any jadeite or rubies mined or extracted from Burma and any
articles of jewelry containing jadeite or rubies mined or extracted
from Burma. Also in E.O. 13651, the President, pursuant to Section 5(i)
of the JADE Act, waived the blocking and financial sanctions provisions
of Section 5(b) of the JADE Act. Except as authorized by or exempt from
the Burmese Sanctions Regulations, 31 CFR part 537 (the
``Regulations''), transactions involving persons whose property and
interests in property are blocked pursuant to E.O. 13310, E.O. 13448,
E.O. 13464, or E.O. 13619 continue to be prohibited pursuant to the
Regulations.
The Regulations, originally issued in 1998 to implement E.O. 13047,
were amended and reissued in their entirety in 2005 to implement E.O.
13310. OFAC now is further amending the Regulations to implement E.O.
13448, E.O. 13464, E.O. 13619, and E.O. 13651. Due to the extensive
nature of these amendments, OFAC is again reissuing the Regulations in
their entirety.
Subpart A of the Regulations clarifies the relation of this part to
other laws and regulations. Subpart B of the Regulations implements the
prohibitions contained in E.O. 13047, E.O. 13310, E.O. 13448, E.O.
13464, E.O. 13619, and E.O. 13651. Section 537.201(a)(1) blocks, with
certain exceptions, all property and interests in property that are in
the United States, that come within the United States, or that are or
come within the possession or control of any United States person,
including any foreign branch, of: (1) Any person listed in the Annexes
to E.O. 13310, E.O. 13448, or E.O. 13464; and (2) any person determined
by the Secretary of the Treasury, in consultation with the Secretary of
State, to meet the criteria set forth in any of those Executive orders.
Section 537.201(a)(2) blocks, with certain exceptions, all property and
interests in property of any person determined by the Secretary of the
Treasury, in consultation with or at the recommendation of the
Secretary of State, to meet the criteria set forth in E.O. 13619.
Persons listed in the Annexes to E.O. 13310, E.O. 13448, or E.O. 13464,
designated by or under the authority of the Secretary of the Treasury
pursuant to E.O. 13310, E.O. 13448, E.O. 13464, or E.O. 13619, or
otherwise subject to the blocking provisions of these authorities are
referred to throughout the Regulations as ``persons whose property and
interests in property are blocked pursuant to Sec. 537.201(a).'' The
names of persons listed in the Annexes to E.O. 13310, E.O. 13448, or
E.O. 13464 or designated pursuant to E.O. 13310, E.O. 13448, E.O.
13464, or E.O. 13619 are published on the SDN List, which is accessible
through the following page on OFAC's Web site: www.treasury.gov/sdn.
Section 537.202 of subpart B prohibits the exportation or
reexportation of financial services to Burma from the United States or
by a U.S. person, wherever located. Note, however, that new section
537.529 contains a general license authorizing the exportation or
reexportation of financial services to Burma, subject to certain
limitations.
Section 537.203 of subpart B prohibits the importation into the
United States of any jadeite or rubies mined or extracted from Burma
and any articles of jewelry containing jadeite or rubies mined or
extracted from Burma.
Section 537.204 of subpart B prohibits new investment in Burma.
Note, however, that new section 537.530 contains a general license
authorizing new investment in Burma by U.S. persons, subject to certain
limitations and requirements.
Section 537.205 of subpart B prohibits any approval, financing,
facilitation, or guarantee by a U.S. person, wherever located, of a
foreign person's transaction where the transaction would be prohibited
by section 537.202 or 537.204 of this part if performed by a U.S.
person or within the United States. Section 537.206 prohibits any
transaction by a U.S. person or within the United States that evades or
avoids, has the purpose of evading or avoiding, causes a violation of,
or attempts to violate any of the prohibitions set forth in the
Regulations, and any conspiracy formed to violate such prohibitions.
Sections 537.207 and 537.208 of subpart B detail the effect of
transfers of blocked property in violation of the Regulations and set
forth the requirement to hold blocked funds, such as currency, bank
deposits, or liquidated financial obligations, in blocked interest-
bearing accounts. Section 537.209 provides that all expenses incident
to the maintenance of blocked physical property shall be the
responsibility of the owners or operators of such property, and that
such expenses shall not be met from blocked funds, unless otherwise
authorized. The section further provides that blocked property may, in
OFAC's discretion, be sold or liquidated and the net proceeds placed in
a blocked interest-bearing account in the name of the owner of the
property.
Exemptions from certain prohibitions contained in the Regulations
are set forth in section 537.210 of subpart B, including, pursuant to
E.O. 13619, a new exemption for the official business of the U.S.
Government.
Subpart C defines key terms used throughout the Regulations, and
subpart D contains interpretive sections regarding the Regulations.
Section 537.416 of subpart D explains that the property and interests
in property of an entity are blocked if the entity is 50 percent or
more owned by a person whose property and interests in property are
blocked, whether or not the name of the entity is incorporated into the
SDN List.
Transactions otherwise prohibited under the Regulations but found
to be consistent with U.S. policy may be authorized by one of the
general licenses contained in subpart E of the Regulations or by a
specific license issued pursuant to the procedures described in subpart
E of 31 CFR part 501. Subpart E of the Regulations also contains
certain statements of specific licensing policy. Several sections in
subpart E of the Regulations have been removed and reserved. In some
cases activities previously authorized in those sections, including
certain importations, are no longer prohibited. In other cases,
including certain financial transactions, the current licensing policy
is now reflected in new sections 537.529 and 537.531, which authorize
the
[[Page 37108]]
exportation or reexportation of financial services to Burma and certain
transactions involving financial institutions included on the SDN List,
respectively. In light of the new general licenses authorizing the
exportation or reexportation of financial services to Burma and certain
transactions involving financial institutions included on the SDN List,
the general license formerly found in section 537.525, which broadly
authorized transactions, including with persons whose property or
interests in property are blocked pursuant to section 537.201(a), by
U.S. citizens permanently residing in Burma, has been removed.
Subpart F of the Regulations refers to subpart C of part 501 for
applicable recordkeeping and reporting requirements. Subpart G
describes the civil and criminal penalties applicable to violations of
the Regulations, as well as the procedures governing the potential
imposition of a civil monetary penalty. Subpart G also refers to
Appendix A of part 501 for a more complete description of these
procedures.
Subpart H of the Regulations refers to subpart E of part 501 for
applicable provisions relating to administrative procedures and
contains a delegation of authority by the Secretary of the Treasury.
Subpart I sets forth a Paperwork Reduction Act notice.
Public Participation
Because the Regulations involve a foreign affairs function, the
provisions of Executive Order 12866 and the Administrative Procedure
Act (5 U.S.C. 553) requiring notice of proposed rulemaking, opportunity
for public participation, and delay in effective date are inapplicable.
Because no notice of proposed rulemaking is required for this rule, the
Regulatory Flexibility Act (5 U.S.C. 601-612) does not apply.
Paperwork Reduction Act
The collections of information related to the Regulations are
contained in 31 CFR part 501 (the ``Reporting, Procedures and Penalties
Regulations''). Pursuant to the Paperwork Reduction Act of 1995 (44
U.S.C. 3507), those collections of information have been approved by
the Office of Management and Budget under control number 1505-0164. An
agency may not conduct or sponsor, and a person is not required to
respond to, a collection of information unless the collection of
information displays a valid control number.
List of Subjects in 31 CFR Part 537
Administrative practice and procedure, Banks, Banking, Blocking of
assets, Burma, Credit, Exportation, Exports, Foreign trade,
Importation, Imports, Investments, Jadeite, Loans, New investment,
Penalties, Reporting and recordkeeping requirements, Rubies,
Securities, Services, Specially Designated Nationals.
For the reasons set forth in the preamble, the Department of the
Treasury's Office of Foreign Assets Control revises part 537 of 31 CFR
chapter V to read as follows:
PART 537--BURMESE SANCTIONS REGULATIONS
Subpart A--Relation of This Part to Other Laws and Regulations
537.101 Relation of this part to other laws and regulations.
Subpart B--Prohibitions
537.201 Prohibited transactions involving blocked property.
537.202 Prohibited exportation or reexportation of financial
services to Burma.
537.203 Prohibited importation of Burmese jadeite and rubies into
the United States.
537.204 Prohibited new investment in Burma.
537.205 Prohibited facilitation.
537.206 Evasions; attempts; causing violations; conspiracies.
537.207 Effect of transfers violating the provisions of this part.
537.208 Holding of funds in interest-bearing accounts; investment
and reinvestment.
537.209 Expenses of maintaining blocked physical property;
liquidation of blocked property.
537.210 Exempt transactions.
Subpart C--General Definitions
537.300 Applicability of definitions.
537.301 Blocked account; blocked property.
537.302 Economic development of resources located in Burma.
537.303 Effective date.
537.304 Entity.
537.305 Exportation or reexportation of financial services to Burma.
537.306 Foreign person.
537.307 Government of Burma.
537.308 Information or informational materials.
537.309 Interest.
537.310 Licenses; general and specific.
537.311 New investment.
537.312 Nongovernmental entity in Burma.
537.313 Person.
537.314 [Reserved]
537.315 Property; property interest.
537.316 Resources located in Burma.
537.317 Transfer.
537.318 United States.
537.319 U.S. depository institution.
537.320 U.S. financial institution.
537.321 United States person; U.S. person.
537.322 U.S. registered broker or dealer in securities.
537.323 U.S. registered money transmitter.
537.324 Jadeite.
537.325 Rubies.
537.326 Articles of jewelry containing jadeite or rubies.
537.327 Financial, material, or technological support.
537.328 OFAC.
Subpart D--Interpretations
537.401 Reference to amended sections.
537.402 Effect of amendment.
537.403 Termination and acquisition of an interest in blocked
property.
537.404 Transactions ordinarily incident to a licensed transaction.
537.405 Provision of services.
537.406 Offshore transactions involving blocked property.
537.407 Payments from blocked accounts to satisfy obligations
prohibited.
537.408 Setoffs prohibited.
537.409 Activities under pre-May 21, 1997 agreements.
537.410 Contracts and subcontracts regarding economic development of
resources in Burma.
537.411 [Reserved]
537.412 Investments in entities involved in economic development
projects in Burma.
537.413 [Reserved]
537.414 Charitable contributions.
537.415 Credit extended and cards issued by U.S. financial
institutions to a person whose property and interests in property
are blocked.
537.416 Entities owned by a person whose property and interests in
property are blocked.
537.417 Importation into a bonded warehouse or foreign trade zone.
537.418 Facilitating new investment.
Subpart E--Licenses, Authorizations, and Statements of Licensing Policy
537.501 General and specific licensing procedures.
537.502 Effect of license or authorization.
537.503 Exclusion from licenses.
537.504 Payments and transfers to blocked accounts in U.S. financial
institutions.
537.505 Entries in certain accounts for normal service charges
authorized.
537.506 Investment and reinvestment of certain funds.
537.507 Provision of certain legal services authorized.
537.508 Authorization of emergency medical services.
537.509 Official activities of certain international organizations
authorized.
537.510-537.518 [Reserved]
537.519 Activities undertaken pursuant to certain pre-May 21, 1997
agreements.
537.520-537.521 [Reserved]
537.522 Certain transactions related to patents, trademarks,
copyrights, and other intellectual property authorized.
537.523-537.525 [Reserved]
537.526 Transactions necessary and ordinarily incident to publishing
authorized.
537.527 [Reserved]
537.528 Payments for legal services from funds originating outside
the United States authorized.
537.529 Exportation or reexportation of financial services to Burma
authorized.
[[Page 37109]]
537.530 New investment in Burma by U.S. persons authorized.
537.531 Certain transactions involving Asia Green Development Bank,
Ayeyarwady Bank, Myanma Economic Bank, and Myanma Investment and
Commercial Bank authorized.
Subpart F--Reports
537.601 Records and reports.
Subpart G--Penalties
537.701 Penalties.
537.702 Pre-Penalty Notice; settlement.
537.703 Penalty imposition.
537.704 Administrative collection; referral to United States
Department of Justice.
Subpart H--Procedures
537.801 Procedures.
537.802 Delegation by the Secretary of the Treasury.
Subpart I--Paperwork Reduction Act
537.901 Paperwork Reduction Act notice.
Authority: 3 U.S.C. 301; 31 U.S.C. 321(b); 50 U.S.C 1601-1651,
1701-1706; Pub. L. 101-410, 104 Stat. 890 (28 U.S.C. 2461 note);
Sec. 570, Pub. L. 104-208, 110 Stat. 3009; Pub. L. 110-96, 121 Stat.
1011 (50 U.S.C. 1701 note); Pub. L. 110-286, 122 Stat. 2632 (50
U.S.C. 1701 note); E.O. 13047, 62 FR 28301, 3 CFR, 1997 Comp., p.
202; E.O. 13310, 68 FR 44853, 3 CFR, 2003 Comp., p. 241; E.O. 13448,
72 FR 60223, 3 CFR, 2007 Comp., p. 304; E.O. 13464, 73 FR 24491, 3
CFR, 2008 Comp., p. 189; E.O. 13619, 77 FR 41243, 3 CFR, 2012 Comp.,
p. 279; E.O. 13651, 78 FR 48793 (August 9, 2013); Determination No.
2009-11, 74 FR 3957, 3 CFR, 2009 Comp., p. 330.
Subpart A--Relation of This Part to Other Laws and Regulations
Sec. 537.101 Relation of this part to other laws and regulations.
This part is separate from, and independent of, the other parts of
this chapter, with the exception of part 501 of this chapter, the
recordkeeping and reporting requirements and license application and
other procedures of which apply to this part. Actions taken pursuant to
part 501 of this chapter with respect to the prohibitions contained in
this part are considered actions taken pursuant to this part. Differing
foreign policy and national security circumstances may result in
differing interpretations of similar language among the parts of this
chapter. No license or authorization contained in or issued pursuant to
those other parts authorizes any transaction prohibited by this part.
No license or authorization contained in or issued pursuant to any
other provision of law or regulation authorizes any transaction
prohibited by this part. No license or authorization contained in or
issued pursuant to this part relieves the involved parties from
complying with any other applicable laws or regulations.
Subpart B--Prohibitions
Sec. 537.201 Prohibited transactions involving blocked property.
(a)(1) All property and interests in property that are in the
United States, that come within the United States, or that are or come
within the possession or control of any United States person, including
any foreign branch, of the following persons are blocked and may not be
transferred, paid, exported, withdrawn, or otherwise dealt in:
(i) The persons listed in the Annex to Executive Order 13310 of
July 28, 2003 (E.O. 13310), the Annex to Executive Order 13448 of
October 18, 2007 (E.O. 13448), or the Annex to Executive Order 13464 of
April 30, 2008 (E.O. 13464); and
(ii) Any person determined by the Secretary of the Treasury, in
consultation with the Secretary of State:
(A) To be a senior official of the Government of Burma, the State
Peace and Development Council of Burma, the Union Solidarity and
Development Association of Burma, or any successor entity to any of the
foregoing;
(B) To be responsible for, or to have participated in, human rights
abuses related to political repression in Burma;
(C) To be engaged, or to have engaged, in activities facilitating
public corruption by senior officials of the Government of Burma;
(D) To be a spouse or dependent child of any person whose property
and interests in property are blocked pursuant to E.O. 13310 or E.O.
13448;
(E) To be owned or controlled by, directly or indirectly, the
Government of Burma or an official or officials of the Government of
Burma;
(F) To have materially assisted, sponsored, or provided financial,
material, or technological support for, or goods or services in support
of, the Government of Burma, the State Peace and Development Council of
Burma, the Union Solidarity and Development Association of Burma, any
successor entity to any of the foregoing, any senior official of any of
the foregoing, or any person whose property and interests in property
are blocked pursuant to this paragraph (a)(1); or
(G) To be owned or controlled by, or to have acted or purported to
act for or on behalf of, directly or indirectly, any person whose
property and interests in property are blocked pursuant to this
paragraph (a)(1).
Note to Sec. 537.201(a)(1): The Department of State has
determined that the State Peace and Development Council of Burma no
longer exists.
(2) All property and interests in property that are in the United
States, that come within the United States, or that are or come within
the possession or control of any United States person, including any
foreign branch, of the following persons are blocked and may not be
transferred, paid, exported, withdrawn, or otherwise dealt in: Any
person determined by the Secretary of the Treasury, in consultation
with or at the recommendation of the Secretary of State:
(i) To have engaged in acts that directly or indirectly threaten
the peace, security, or stability of Burma, such as actions that have
the purpose or effect of undermining or obstructing the political
reform process or the peace process with ethnic minorities in Burma;
(ii) To be responsible for or complicit in, or responsible for
ordering, controlling, or otherwise directing, or to have participated
in, the commission of human rights abuses in Burma;
(iii) To have, directly or indirectly, imported, exported,
reexported, sold, or supplied arms or related materiel from North Korea
or the Government of North Korea to Burma or the Government of Burma;
(iv) To be a senior official of an entity that has engaged in the
acts described in paragraphs (a)(2)(i) through (iii) of this section;
(v) To have materially assisted, sponsored, or provided financial,
material, or technological support for, or goods or services to or in
support of, the acts described in paragraphs (a)(2)(i) through (iii) of
this section or any person whose property and interests in property are
blocked pursuant to this paragraph (a)(2); or
(vi) To be owned or controlled by, or to have acted or purported to
act for or on behalf of, directly or indirectly, any person whose
property and interests in property are blocked pursuant to this
paragraph (a)(2).
Note 1 to paragraph (a) of Sec. 537.201: The names of persons
listed in or designated pursuant to E.O. 13310, E.O. 13448, E.O.
13464, or Executive Order 13619 of July 11, 2012, whose property and
interests in property are blocked pursuant to paragraph (a) of this
section, are published in the Federal Register and incorporated into
OFAC's Specially Designated Nationals and Blocked Persons List (SDN
List) with the identifier ``[BURMA].'' The SDN List is accessible
through the following page on OFAC's Web site: www.treasury.gov/sdn.
Additional information pertaining to the SDN List can be found in
Appendix A to this chapter. See Sec. 537.416 concerning entities
that may not be listed on the SDN List but whose property and
interests in property are nevertheless blocked pursuant to paragraph
(a) of this section.
[[Page 37110]]
Note 2 to paragraph (a) of Sec. 537.201: The International
Emergency Economic Powers Act (50 U.S.C. 1701-1706), in section 203
(50 U.S.C. 1702), authorizes the blocking of property and interests
in property of a person during the pendency of an investigation. The
names of persons whose property and interests in property are
blocked pending investigation pursuant to paragraph (a) of this
section also are published in the Federal Register and incorporated
into the SDN List with the identifier ``[BPI-BURMA].''
Note 3 to paragraph (a) of Sec. 537.201: Sections 501.806 and
501.807 of this chapter describe the procedures to be followed by
persons seeking, respectively, the unblocking of funds that they
believe were blocked due to mistaken identity, or administrative
reconsideration of their status as persons whose property and
interests in property are blocked pursuant to paragraph (a) of this
section.
(b) The prohibitions in paragraph (a) of this section include, but
are not limited to, prohibitions on the following transactions:
(1) The making of any contribution or provision of funds, goods, or
services by, to, or for the benefit of any person whose property and
interests in property are blocked pursuant to paragraph (a) of this
section; and
(2) The receipt of any contribution or provision of funds, goods,
or services from any person whose property and interests in property
are blocked pursuant to paragraph (a) of this section.
(c) Unless authorized by this part or by a specific license
expressly referring to this section, any dealing in any security (or
evidence thereof) held within the possession or control of a U.S.
person and either registered or inscribed in the name of, or known to
be held for the benefit of, or issued by, any person whose property and
interests in property are blocked pursuant to paragraph (a) of this
section is prohibited. This prohibition includes but is not limited to
the transfer (including the transfer on the books of any issuer or
agent thereof), disposition, transportation, importation, exportation,
or withdrawal of, or the endorsement or guaranty of signatures on, any
such security on or after the effective date. This prohibition applies
irrespective of the fact that at any time (whether prior to, on, or
subsequent to the effective date) the registered or inscribed owner of
any such security may have or might appear to have assigned,
transferred, or otherwise disposed of the security.
(d) The prohibitions in paragraph (a) of this section apply except
to the extent transactions are authorized by regulations, orders,
directives, rulings, instructions, licenses, or otherwise, and
notwithstanding any contract entered into or any license or permit
granted prior to the effective date.
Note to Sec. 537.201: Section 5(b) of the Tom Lantos Block
Burmese JADE (Junta's Anti-Democratic Efforts) Act of 2008 (Pub. L.
110-286) (JADE Act) imposes blocking and financial sanctions on
certain categories of persons described in Section 5(a)(1) of the
JADE Act. In Executive Order 13651 of August 6, 2013, the President
waived these blocking and financial sanctions pursuant to Section
5(i) of the JADE Act. Except as authorized or exempt, transactions
involving persons whose property and interests in property are
blocked pursuant to paragraph (a) of this section continue to be
prohibited.
Sec. 537.202 Prohibited exportation or reexportation of financial
services to Burma.
Except as otherwise authorized, the exportation or reexportation,
directly or indirectly, to Burma of any financial services from the
United States or by a U.S. person, wherever located, is prohibited.
Note to Sec. 537.202: See Sec. 537.529 for a general license
authorizing the exportation or reexportation of financial services
to Burma.
Sec. 537.203 Prohibited importation of Burmese jadeite and rubies
into the United States.
(a) Except as provided in paragraphs (b) and (c) of this section or
as otherwise authorized, the importation into the United States of any
jadeite or rubies mined or extracted from Burma and any articles of
jewelry containing jadeite or rubies mined or extracted from Burma is
prohibited.
(b) The prohibition in paragraph (a) of this section does not apply
to any jadeite or rubies mined or extracted from Burma or any articles
of jewelry containing jadeite or rubies mined or extracted from Burma
that were previously exported from the United States, including those
that accompanied an individual outside the United States for personal
use, if they are reimported to the United States by the same person,
without having been advanced in value or improved in condition by any
process or other means while outside the United States.
(c) Nothing in paragraph (a) of this section shall prohibit
transactions to the extent such prohibition would conflict with the
international obligations of the United States under the Vienna
Convention on Diplomatic Relations, the Vienna Convention on Consular
Relations, the United Nations Headquarters Agreement, or other legal
instruments providing equivalent privileges and immunities.
Note Sec. 537.203: See Sec. Sec. 537.324, 537.325, and
537.326 for definitions of the terms jadeite, rubies, and articles
of jewelry containing jadeite or rubies, respectively.
Sec. 537.204 Prohibited new investment in Burma.
Except as otherwise authorized, new investment, as defined in Sec.
537.311, in Burma by U.S. persons is prohibited.
Note to Sec. 537.204: See Sec. 537.530 for a general license
authorizing new investment in Burma by U.S. persons.
Sec. 537.205 Prohibited facilitation.
(a) Except as otherwise authorized, U.S. persons, wherever located,
are prohibited from approving, financing, facilitating, or guaranteeing
a transaction by a person who is a foreign person where the transaction
by that foreign person would be prohibited by Sec. 537.202 or Sec.
537.204 of this part if performed by a U.S. person or within the United
States.
(b) With respect to new investment in Burma, the prohibition
against facilitation does not include the entry into, performance of,
or financing of a contract to sell or purchase goods, services, or
technology unless such contract includes any of the activities
described in Sec. 537.311(a)(2), (3), or (4).
Note to Sec. 537.205: See Sec. 537.530 for a general license
authorizing new investment in Burma by U.S. persons. See Sec.
537.418 for an interpretive provision regarding facilitating new
investment in Burma.
Sec. 537.206 Evasions; attempts; causing violations; conspiracies.
(a) Any transaction by a U.S. person or within the United States on
or after the effective date that evades or avoids, has the purpose of
evading or avoiding, causes a violation of, or attempts to violate any
of the prohibitions set forth in this part is prohibited.
(b) Any conspiracy formed to violate any of the prohibitions set
forth in this part is prohibited.
Sec. 537.207 Effect of transfers violating the provisions of this
part.
(a) Any transfer after the effective date that is in violation of
any provision of this part or of any regulation, order, directive,
ruling, instruction, or license issued pursuant to this part, and that
involves any property or interest in property blocked pursuant to Sec.
537.201(a), is null and void and shall not be the basis for the
assertion or recognition of any interest in or right, remedy, power, or
privilege with respect to such property or property interest.
(b) No transfer before the effective date shall be the basis for
the assertion or recognition of any right, remedy, power, or privilege
with respect to, or any interest in, any property or interest
[[Page 37111]]
in property blocked pursuant to Sec. 537.201(a), unless the person who
holds or maintains such property, prior to that date, had written
notice of the transfer or by any written evidence had recognized such
transfer.
(c) Unless otherwise provided, a license or other authorization
issued by OFAC before, during, or after a transfer shall validate such
transfer or make it enforceable to the same extent that it would be
valid or enforceable but for the provisions of this part and any
regulation, order, directive, ruling, instruction, or license issued
pursuant to this part.
(d) Transfers of property that otherwise would be null and void or
unenforceable by virtue of the provisions of this section shall not be
deemed to be null and void or unenforceable as to any person with whom
such property is or was held or maintained (and as to such person only)
in cases in which such person is able to establish to the satisfaction
of OFAC each of the following:
(1) Such transfer did not represent a willful violation of the
provisions of this part by the person with whom such property is or was
held or maintained (and as to such person only);
(2) The person with whom such property is or was held or maintained
did not have reasonable cause to know or suspect, in view of all the
facts and circumstances known or available to such person, that such
transfer required a license or authorization issued pursuant to this
part and was not so licensed or authorized, or, if a license or
authorization did purport to cover the transfer, that such license or
authorization had been obtained by misrepresentation of a third party
or withholding of material facts or was otherwise fraudulently
obtained; and
(3) The person with whom such property is or was held or maintained
filed with OFAC a report setting forth in full the circumstances
relating to such transfer promptly upon discovery that:
(i) Such transfer was in violation of the provisions of this part
or any regulation, ruling, instruction, license, or other directive or
authorization issued pursuant to this part;
(ii) Such transfer was not licensed or authorized by OFAC; or
(iii) If a license did purport to cover the transfer, such license
had been obtained by misrepresentation of a third party or withholding
of material facts or was otherwise fraudulently obtained.
Note to Sec. 537.207(d): The filing of a report in accordance
with the provisions of paragraph (d)(3) of this section shall not be
deemed evidence that the terms of paragraphs (d)(1) and (2) of this
section have been satisfied.
(e) Unless licensed pursuant to this part, any attachment,
judgment, decree, lien, execution, garnishment, or other judicial
process is null and void with respect to any property and interests in
property blocked pursuant to Sec. 537.201(a).
Sec. 537.208 Holding of funds in interest-bearing accounts;
investment and reinvestment.
(a) Except as provided in paragraph (e) or (f) of this section, or
as otherwise directed by OFAC, any U.S. person holding funds, such as
currency, bank deposits, or liquidated financial obligations, subject
to Sec. 537.201(a) shall hold or place such funds in a blocked
interest-bearing account located in the United States.
(b)(1) For purposes of this section, the term blocked interest-
bearing account means a blocked account:
(i) In a federally-insured U.S. bank, thrift institution, or credit
union, provided the funds are earning interest at rates that are
commercially reasonable; or
(ii) With a broker or dealer registered with the Securities and
Exchange Commission under the Securities Exchange Act of 1934 (15
U.S.C. 78a et seq.), provided the funds are invested in a money market
fund or in U.S. Treasury bills.
(2) Funds held or placed in a blocked account pursuant to paragraph
(a) of this section may not be invested in instruments the maturity of
which exceeds 180 days.
(c) For purposes of this section, a rate is commercially reasonable
if it is the rate currently offered to other depositors on deposits or
instruments of comparable size and maturity.
(d) For purposes of this section, if interest is credited to a
separate blocked account or subaccount, the name of the account party
on each account must be the same.
(e) Blocked funds held in instruments the maturity of which exceeds
180 days at the time the funds become subject to Sec. 537.201(a) may
continue to be held until maturity in the original instrument, provided
any interest, earnings, or other proceeds derived therefrom are paid
into a blocked interest-bearing account in accordance with paragraph
(a) or (f) of this section.
(f) Blocked funds held in accounts or instruments outside the
United States at the time the funds become subject to Sec. 537.201(a)
may continue to be held in the same type of accounts or instruments,
provided the funds earn interest at rates that are commercially
reasonable.
(g) This section does not create an affirmative obligation for the
holder of blocked tangible property, such as chattels or real estate,
or of other blocked property, such as debt or equity securities, to
sell or liquidate such property. However, OFAC may issue licenses
permitting or directing such sales or liquidation in appropriate cases.
(h) Funds subject to this section may not be held, invested, or
reinvested in a manner that provides immediate financial or economic
benefit or access to any person whose property and interests in
property are blocked pursuant to Sec. 537.201(a), nor may their holder
cooperate in or facilitate the pledging or other attempted use as
collateral of blocked funds or other assets.
Sec. 537.209 Expenses of maintaining blocked physical property;
liquidation of blocked property.
(a) Except as otherwise authorized, and notwithstanding the
existence of any rights or obligations conferred or imposed by any
international agreement or contract entered into or any license or
permit granted prior to the effective date, all expenses incident to
the maintenance of physical property blocked pursuant to Sec.
537.201(a) shall be the responsibility of the owners or operators of
such property, which expenses shall not be met from blocked funds.
(b) Property blocked pursuant to Sec. 537.201(a) may, in the
discretion of OFAC, be sold or liquidated and the net proceeds placed
in a blocked interest-bearing account in the name of the owner of the
property.
Sec. 537.210 Exempt transactions.
(a) Personal communications. The prohibitions contained in this
part do not apply to any postal, telegraphic, telephonic, or other
personal communication that does not involve the transfer of anything
of value.
(b) Information or informational materials. (1) The prohibitions
contained in this part do not apply to the importation from any country
and the exportation to any country of any information or informational
materials, as defined in Sec. 537.308, whether commercial or
otherwise, regardless of format or medium of transmission.
(2) This section does not exempt from regulation or authorize
transactions related to information or informational materials not
fully created and in existence at the date of the transactions, or to
the substantive or artistic alteration or enhancement of informational
[[Page 37112]]
materials, or to the provision of marketing and business consulting
services. Such prohibited transactions include, but are not limited to,
payment of advances for information or informational materials not yet
created and completed (with the exception of prepaid subscriptions for
widely circulated magazines and other periodical publications);
provision of services to market, produce or co-produce, create, or
assist in the creation of information or informational materials; and
payment of royalties with respect to income received for enhancements
or alterations made by U.S. persons to such information or
informational materials.
(3) This section does not exempt or authorize transactions incident
to the exportation of software subject to the Export Administration
Regulations, 15 CFR parts 730-774, or to the exportation of goods
(including software) or technology for use in the transmission of any
data, or to the provision, sale, or leasing of capacity on
telecommunications transmission facilities (such as satellite or
terrestrial network connectivity) for use in the transmission of any
data. The exportation of such items or services and the provision,
sale, or leasing of such capacity or facilities to a person whose
property and interests in property are blocked pursuant to Sec.
537.201(a) are prohibited.
(c) Travel. The prohibitions contained in this part do not apply to
transactions ordinarily incident to travel to or from any country,
including importation or exportation of accompanied baggage for
personal use, maintenance within any country including payment of
living expenses and acquisition of goods or services for personal use,
and arrangement or facilitation of such travel, including nonscheduled
air, sea, or land voyages.
(d) Pre-1997 contracts. Except as prohibited by Sec. 537.201(a)
with respect to persons whose property and interests in property are
blocked pursuant to Executive Order 13448 of October 18, 2007,
Executive Order 13464 of April 30, 2008, or Executive Order 13619 of
July 11, 2012, or by Sec. 537.203, the prohibitions contained in this
part do not apply to any activity undertaken pursuant to an agreement,
or pursuant to the exercise of rights under such an agreement, that was
entered into by a U.S. person with the Government of Burma or a non-
governmental entity in Burma prior to 12:01 a.m. eastern daylight time
on May 21, 1997.
(e) Official business. The prohibitions contained in this part,
other than that in Sec. 537.203, do not apply to transactions for the
conduct of the official business of the United States Government by
employees, grantees, or contractors thereof.
Note to Sec. 537.210(e): Section 537.210(e) does not apply to
the extent that engaging in such transactions would require the
issuance of a statutory waiver and such a waiver is not issued. As
of June 30, 2014, the statutory waivers required to authorize
otherwise prohibited transactions have been issued. Specifically,
the Department of State, pursuant to a delegation of authority from
the President, waived the ban on new U.S. investment in Burma set
forth in the Foreign Operations, Export Financing, and Related
Programs Appropriations Act, 1997, and in Sec. 537.204 of this
part. In addition, in Executive Order 13651 of August 6, 2013, the
President waived pursuant to Section 5(i) of the Tom Lantos Block
Burmese JADE (Junta's Anti-Democratic Efforts) Act of 2008 (Pub. L.
110-286) (JADE Act) the blocking and financial sanctions provisions
of Section 5(b) of the JADE Act.
Subpart C--General Definitions
Sec. 537.300 Applicability of definitions.
The definitions in this subpart apply throughout the entire part.
Sec. 537.301 Blocked account; blocked property.
The terms blocked account and blocked property shall mean any
account or property subject to the prohibitions in Sec. 537.201 held
in the name of a person whose property and interests in property are
blocked pursuant to Sec. 537.201(a), or in which such person has an
interest, and with respect to which payments, transfers, exportations,
withdrawals, or other dealings may not be made or effected except
pursuant to a license or other authorization from OFAC expressly
authorizing such action.
Note to Sec. 537.301: See Sec. 537.416 concerning the blocked
status of property and interests in property of an entity that is 50
percent or more owned by a person whose property and interests in
property are blocked pursuant to Sec. 537.201(a).
Sec. 537.302 Economic development of resources located in Burma.
(a) The term economic development of resources located in Burma
means activities pursuant to a contract the subject of which includes
responsibility for the development or exploitation of resources located
in Burma, including making or attempting to make those resources
accessible or available for exploitation or economic use. The term
shall not be construed to include not-for-profit educational, health,
or other humanitarian programs or activities.
(b) Examples: The economic development of resources located in
Burma includes a contract conferring rights to explore for, develop,
extract, or refine petroleum, natural gas, or minerals in the ground in
Burma; or a contract to assume control of a mining operation in Burma,
acquire a forest or agricultural area for commercial use of the timber
or other crops, or acquire land for the construction and operation of a
hotel or factory.
Note to Sec. 537.302: See Sec. 537.316 for a definition of
the term resources located in Burma.
Sec. 537.303 Effective date.
The term effective date refers to the effective date of the
applicable prohibitions and directives contained in this part as
follows:
(a) With respect to a person whose property and interests in
property are blocked pursuant to Sec. 537.201(a)(1)(i), 12:01 a.m.
eastern daylight time, July 29, 2003, for persons listed in the Annex
to Executive Order 13310 of July 28, 2003; 12:01 a.m. eastern daylight
time, October 19, 2007, for persons listed in the Annex to Executive
Order 13448 of October 18, 2007; and 12:01 a.m. eastern daylight time,
May 1, 2008, for persons listed in the Annex to Executive Order 13464
of April 30, 2008;
(b) With respect to a person whose property and interests in
property are otherwise blocked pursuant to Sec. 537.201(a), the
earlier of the date of actual or constructive notice that such person's
property and interests in property are blocked;
(c) With respect to the exportation or reexportation of financial
services to Burma prohibited by Sec. 537.202, or with respect to
facilitation thereof prohibited by Sec. 537.205, 12:01 a.m. eastern
daylight time, July 29, 2003;
(d) With respect to the importation into the United States of any
jadeite or rubies mined or extracted from Burma and any articles of
jewelry containing jadeite or rubies mined or extracted from Burma
prohibited by Sec. 537.203, 12:01 a.m. eastern daylight time, August
7, 2013;
(e) With respect to new investment prohibited by Sec. 537.204, or
with respect to facilitation thereof prohibited by Sec. 537.205, 12:01
a.m. eastern daylight time, May 21, 1997.
Sec. 537.304 Entity.
The term entity means a partnership, association, trust, joint
venture, corporation, group, subgroup, or other organization.
Sec. 537.305 Exportation or reexportation of financial services to
Burma.
The term exportation or reexportation of financial services to
Burma means:
[[Page 37113]]
(a) The transfer of funds, directly or indirectly, from the United
States or by a U.S. person, wherever located, to Burma; or
(b) The provision, directly or indirectly, to persons in Burma of
insurance services, investment or brokerage services (including but not
limited to brokering or trading services regarding securities, debt,
commodities, options, or foreign exchange), banking services, or money
remittance services; loans, guarantees, letters of credit, or other
extensions of credit; or the service of selling or redeeming traveler's
checks, money orders, or stored value.
Sec. 537.306 Foreign person.
The term foreign person means any person that is not a U.S. person.
Sec. 537.307 Government of Burma.
The term Government of Burma means the Government of Burma (also
known as Myanmar), its agencies, instrumentalities, and controlled
entities, and the Central Bank of Burma.
Sec. 537.308 Information or informational materials.
(a) The term information or informational materials includes, but
is not limited to, publications, films, posters, phonograph records,
photographs, microfilms, microfiche, tapes, compact disks, CD ROMs,
artworks, and news wire feeds.
Note to Sec. 537.308(a): To be considered information or
informational materials, artworks must be classified under heading
9701, 9702, or 9703 of the Harmonized Tariff Schedule of the United
States.
(b) The term information or informational materials, with respect
to exports, does not include items:
(1) That were, as of April 30, 1994, or that thereafter become,
controlled for export pursuant to section 5 of the Export
Administration Act of 1979, 50 U.S.C. App. 2401-2420 (1979) (the
``EAA''), or section 6 of the EAA to the extent that such controls
promote the nonproliferation or antiterrorism policies of the United
States; or
(2) With respect to which acts are prohibited by 18 U.S.C. chapter
37.
Sec. 537.309 Interest.
Except as otherwise provided in this part, the term interest, when
used with respect to property (e.g., ``an interest in property''),
means an interest of any nature whatsoever, direct or indirect.
Sec. 537.310 Licenses; general and specific.
(a) Except as otherwise provided in this part, the term license
means any license or authorization contained in or issued pursuant to
this part.
(b) The term general license means any license or authorization the
terms of which are set forth in subpart E of this part or are made
available on OFAC's Web site: www.treasury.gov/ofac.
(c) The term specific license means any license or authorization
issued pursuant to this part, but not set forth in subpart E of this
part or made available on OFAC's Web site.
Note to Sec. 537.310: See Sec. 501.801 of this chapter on
licensing procedures.
Sec. 537.311 New investment.
(a) The term new investment means any of the following activities
if such activity is undertaken pursuant to an agreement, or pursuant to
the exercise of rights under such an agreement, that is entered into
with the Government of Burma or a nongovernmental entity in Burma on or
after May 21, 1997:
(1) The entry into a contract that includes the economic
development of resources located in Burma, as defined in Sec. 537.302;
(2) The entry into a contract providing for the general supervision
and guarantee of another person's performance of a contract that
includes the economic development of resources located in Burma;
(3) The purchase of a share of ownership, including an equity
interest, in the economic development of resources located in Burma; or
(4) The entry into a contract providing for the participation in
royalties, earnings, or profits in the economic development of
resources located in Burma, without regard to the form of the
participation.
(b) The term new investment shall not include the entry into,
performance of, or financing of a contract to sell or purchase goods,
services, or technology unless such contract includes any of the
activities described in paragraphs (a)(2) through (4) of this section.
Sec. 537.312 Nongovernmental entity in Burma.
The term nongovernmental entity in Burma means a partnership,
association, trust, joint venture, corporation, or other organization,
wherever organized, that is located in Burma or exists for the
exclusive or predominant purpose of engaging in the economic
development of resources located in Burma or derives its income
predominantly from such economic development, and is not the Government
of Burma.
Sec. 537.313 Person.
The term person means an individual or entity.
Sec. 537.314 [Reserved]
Sec. 537.315 Property; property interest.
The terms property and property interest include, but are not
limited to, money, checks, drafts, bullion, bank deposits, savings
accounts, debts, indebtedness, obligations, notes, guarantees,
debentures, stocks, bonds, coupons, any other financial instruments,
bankers acceptances, mortgages, pledges, liens or other rights in the
nature of security, warehouse receipts, bills of lading, trust
receipts, bills of sale, any other evidences of title, ownership or
indebtedness, letters of credit and any documents relating to any
rights or obligations thereunder, powers of attorney, goods, wares,
merchandise, chattels, stocks on hand, ships, goods on ships, real
estate mortgages, deeds of trust, vendors' sales agreements, land
contracts, leaseholds, ground rents, real estate and any other interest
therein, options, negotiable instruments, trade acceptances, royalties,
book accounts, accounts payable, judgments, patents, trademarks or
copyrights, insurance policies, safe deposit boxes and their contents,
annuities, pooling agreements, services of any nature whatsoever,
contracts of any nature whatsoever, and any other property, real,
personal, or mixed, tangible or intangible, or interest or interests
therein, present, future, or contingent.
Sec. 537.316 Resources located in Burma.
The term resources located in Burma means any resources, including
natural, agricultural, commercial, financial, industrial, and human
resources, located within the territory of Burma, including the
territorial sea, or located within the exclusive economic zone or
continental shelf of Burma.
Sec. 537.317 Transfer.
The term transfer means any actual or purported act or transaction,
whether or not evidenced by writing, and whether or not done or
performed within the United States, the purpose, intent, or effect of
which is to create, surrender, release, convey, transfer, or alter,
directly or indirectly, any right, remedy, power, privilege, or
interest with respect to any property. Without limitation on the
foregoing, it shall include the making, execution, or delivery of any
assignment, power, conveyance, check, declaration, deed, deed of trust,
power of attorney, power of appointment, bill of sale, mortgage,
receipt, agreement, contract, certificate, gift, sale, affidavit, or
statement; the making of any payment; the setting off of any obligation
or credit; the appointment of
[[Page 37114]]
any agent, trustee, or fiduciary; the creation or transfer of any lien;
the issuance, docketing, filing, or levy of or under any judgment,
decree, attachment, injunction, execution, or other judicial or
administrative process or order, or the service of any garnishment; the
acquisition of any interest of any nature whatsoever by reason of a
judgment or decree of any foreign country; the fulfillment of any
condition; the exercise of any power of appointment, power of attorney,
or other power; or the acquisition, disposition, transportation,
importation, exportation, or withdrawal of any security.
Sec. 537.318 United States.
The term United States means the United States, its territories and
possessions, and all areas under the jurisdiction or authority thereof.
Sec. 537.319 U.S. depository institution.
The term U.S. depository institution means any entity (including
its foreign branches) organized under the laws of the United States or
any jurisdiction within the United States, or any agency, office, or
branch located in the United States of a foreign entity, that is
engaged primarily in the business of banking (for example, banks,
savings banks, savings associations, credit unions, trust companies,
and United States bank holding companies) and is subject to regulation
by federal or state banking authorities.
Sec. 537.320 U.S. financial institution.
The term U.S. financial institution means any U.S. entity
(including its foreign branches) that is engaged in the business of
accepting deposits, making, granting, transferring, holding, or
brokering a loan or other extension of credit, or purchasing or selling
foreign exchange, securities, commodity futures or options, or
procuring purchasers and sellers thereof, as principal or agent. It
includes but is not limited to depository institutions, banks, savings
banks, trust companies, securities brokers and dealers, commodity
futures and options brokers and dealers, forward contract and foreign
exchange merchants, securities and commodities exchanges, clearing
corporations, investment companies, employee benefit plans, and U.S.
holding companies, U.S. affiliates, or U.S. subsidiaries of any of the
foregoing. This term includes those branches, offices, and agencies of
foreign financial institutions that are located in the United States,
but not such institutions' foreign branches, offices, or agencies.
Sec. 537.321 United States person; U.S. person.
The term United States person or U.S. person means any United
States citizen, permanent resident alien, entity organized under the
laws of the United States or any jurisdiction within the United States
(including foreign branches), or any person in the United States.
Sec. 537.322 U.S. registered broker or dealer in securities.
The term U.S. registered broker or dealer in securities means any
U.S. citizen, permanent resident alien, or entity organized under the
laws of the United States or of any jurisdiction within the United
States (including its foreign branches), or any agency, office, or
branch of a foreign entity located in the United States, that:
(a) Is a ``broker'' or ``dealer'' in securities within the meanings
set forth in the Securities Exchange Act of 1934;
(b) Holds or clears customer accounts; and
(c) Is registered with the Securities and Exchange Commission under
the Securities Exchange Act of 1934.
Sec. 537.323 U.S. registered money transmitter.
The term U.S. registered money transmitter means any U.S. citizen,
permanent resident alien, or entity organized under the laws of the
United States or of any jurisdiction within the United States
(including its foreign branches), or any agency, office, or branch of a
foreign entity located in the United States, that is a money
transmitter, as defined in 31 CFR 1010.100(ff)(5), and that is
registered pursuant to 31 CFR 1022.380.
Sec. 537.324 Jadeite.
The term jadeite means any jadeite classifiable under heading 7103
of the Harmonized Tariff Schedule of the United States.
Sec. 537.325 Rubies.
The term rubies means any rubies classifiable under heading 7103 of
the Harmonized Tariff Schedule of the United States.
Sec. 537.326 Articles of jewelry containing jadeite or rubies.
The term articles of jewelry containing jadeite or rubies means any
article of jewelry classifiable under heading 7113 of the Harmonized
Tariff Schedule of the United States that contains jadeite or rubies,
or any article of jadeite or rubies classifiable under heading 7116 of
the Harmonized Tariff Schedule of the United States.
Sec. 537.327 Financial, material, or technological support.
The term financial, material, or technological support, as used in
Sec. 537.201(a) of this part, means any property, tangible or
intangible, including but not limited to currency, financial
instruments, securities, or any other transmission of value; weapons or
related materiel; chemical or biological agents; explosives; false
documentation or identification; communications equipment; computers;
electronic or other devices or equipment; technologies; lodging; safe
houses; facilities; vehicles or other means of transportation; or
goods. ``Technologies'' as used in this definition means specific
information necessary for the development, production, or use of a
product, including related technical data such as blueprints, plans,
diagrams, models, formulae, tables, engineering designs and
specifications, manuals, or other recorded instructions.
Sec. 537.328 OFAC.
The term OFAC means the Department of the Treasury's Office of
Foreign Assets Control.
Subpart D--Interpretations
Sec. 537.401 Reference to amended sections.
Except as otherwise specified, reference to any provision in or
appendix to this part or chapter or to any regulation, ruling, order,
instruction, directive, or license issued pursuant to this part refers
to the same as currently amended.
Sec. 537.402 Effect of amendment.
Unless otherwise specifically provided, any amendment,
modification, or revocation of any provision in or appendix to this
part or chapter or of any order, regulation, ruling, instruction, or
license issued by OFAC does not affect any act done or omitted, or any
civil or criminal proceeding commenced or pending, prior to such
amendment, modification, or revocation. All penalties, forfeitures, and
liabilities under any such order, regulation, ruling, instruction, or
license continue and may be enforced as if such amendment,
modification, or revocation had not been made.
Sec. 537.403 Termination and acquisition of an interest in blocked
property.
(a) Whenever a transaction licensed or authorized by or pursuant to
this part results in the transfer of property (including any property
interest) away from a person whose property and interests in property
are blocked pursuant to Sec. 537.201(a), such property
[[Page 37115]]
shall no longer be deemed to be property blocked pursuant to Sec.
537.201(a), unless there exists in the property another interest that
is blocked pursuant to Sec. 537.201(a), the transfer of which has not
been effected pursuant to license or other authorization.
(b) Unless otherwise specifically provided in a license or
authorization issued pursuant to this part, if property (including any
property interest) is transferred or attempted to be transferred to a
person whose property and interests in property are blocked pursuant to
Sec. 537.201(a), such property shall be deemed to be property in which
such a person has an interest and therefore blocked.
Sec. 537.404 Transactions ordinarily incident to a licensed
transaction.
(a) Any transaction ordinarily incident to a licensed transaction
and necessary to give effect thereto is also authorized, except:
(1) An ordinarily incident transaction, not explicitly authorized
within the terms of the license, by or with a person whose property and
interests in property are blocked pursuant to Sec. 537.201(a), except
as provided in paragraph (b) of this section; or
(2) An ordinarily incident transaction, not explicitly authorized
within the terms of the license, involving a debit to a blocked account
or a transfer of blocked property.
(b) Transactions licensed pursuant to subpart E of this part and
those transactions falling within the scope of paragraph (a) of this
section are authorized even though they may involve transfers to or
from an account of a financial institution whose property and interests
in property are blocked pursuant to Sec. 537.201(a), provided that the
account is not on the books of a financial institution that is a U.S.
person, unless otherwise authorized.
Note to Sec. 537.404(b): See Sec. 537.531 for a general
license authorizing transactions involving certain Burmese financial
institutions whose property and interests in property are blocked
pursuant to Sec. 537.201(a), including establishing and maintaining
accounts on the books of U.S. financial institutions.
(c) Example: A license authorizing a person to complete a
securities sale involving Company A, whose property and interests in
property are blocked pursuant to Sec. 537.201(a), also authorizes
other persons to engage in activities that are ordinarily incident and
necessary to complete the sale, including transactions by the buyer,
broker, transfer agents, and banks, provided that, except as provided
in paragraph (b) of this section, such other persons are not themselves
persons whose property and interests in property are blocked pursuant
to Sec. 537.201(a).
Sec. 537.405 Provision of services.
(a) The prohibitions on transactions contained in Sec. 537.201
apply to services performed in the United States or by U.S. persons,
wherever located, including by a foreign branch of an entity located in
the United States:
(1) On behalf of or for the benefit of a person whose property and
interests in property are blocked pursuant to Sec. 537.201(a); or
(2) With respect to property interests of any person whose property
and interests in property are blocked pursuant to Sec. 537.201(a).
(b) Example: U.S. persons may not, except as authorized by or
pursuant to this part, provide legal, accounting, financial, brokering,
freight forwarding, transportation, public relations, or other services
to a person whose property and interests in property are blocked
pursuant to Sec. 537.201(a).
Note to Sec. 537.405: See Sec. Sec. 537.507 and 537.508 on
licensing policy with regard to the provision of certain legal and
emergency medical services.
Sec. 537.406 Offshore transactions involving blocked property.
The prohibitions in Sec. 537.201 on transactions or dealings
involving blocked property apply to transactions by any U.S. person in
a location outside the United States with respect to property held in
the name of a person whose property and interests in property are
blocked pursuant to Sec. 537.201(a).
Sec. 537.407 Payments from blocked accounts to satisfy obligations
prohibited.
Pursuant to Sec. 537.201, no debits may be made to a blocked
account to pay obligations to U.S. persons or other persons, except as
authorized by or pursuant to this part.
Note to Sec. 537.407: See also Sec. 537.502(e), which
provides that no license or other authorization contained in or
issued pursuant to this part authorizes transfers of or payments
from blocked property or debits to blocked accounts unless the
license or other authorization explicitly authorizes the transfer of
or payment from blocked property or the debit to a blocked account.
Sec. 537.408 Setoffs prohibited.
A setoff against blocked property (including a blocked account),
whether by a U.S. bank or other U.S. person, is a prohibited transfer
under Sec. 537.201 if effected after the effective date.
Sec. 537.409 Activities under pre-May 21, 1997 agreements.
Pursuant to Sec. 537.210(d), a U.S. person who is a party to a
pre-May 21, 1997 agreement may enter into subsequent agreements where
such agreements are pursuant to, or in exercise of rights under, the
pre-May 21, 1997 agreement and are specifically contemplated by the
pre-May 21, 1997 agreement, unless such subsequent agreements involve
any activity prohibited by Sec. 537.201(a) with respect to any person
whose property and interests in property are blocked pursuant to
Executive Order 13448 of October 18, 2007 (E.O. 13448), Executive Order
13464 of April 30, 2008 (E.O. 13464), or Executive Order 13619 of July
11, 2012 (E.O. 13619), or by Sec. 537.203. The exercise of rights
under a pre-May 21, 1997 agreement may include the exercise of options
to extend the contract, depending on such factors as the degree of
specificity with which the option to extend is described in the pre-May
21, 1997 agreement and the degree to which the party wishing to renew
can enforce its decision to exercise the option, unless such exercise
of rights involves any activity prohibited by Sec. 537.201(a) with
respect to any person whose property and interests in property are
blocked pursuant to E.O. 13448, E.O. 13464, or E.O. 13619, or by Sec.
537.203.
Sec. 537.410 Contracts and subcontracts regarding economic
development of resources in Burma.
Section 537.204 prohibits new investment in Burma by U.S. persons.
However, pursuant to Sec. 537.530, U.S. persons may engage in new
investment in Burma, provided that all conditions of that general
license are satisfied. Section 537.311 defines the term new investment
to include certain contracts providing for the general supervision and
guarantee of another person's performance of a contract that includes
the economic development of resources located in Burma. With respect to
entry into such contracts, only the following will be considered new
investment in Burma:
(a) Entry into contracts for supervision and guarantee at the
highest level of project management, such as entry into a contract with
a development project's sponsor or owner to become a prime contractor
or general manager for a development project;
(b) Entry into subcontracts where the functional scope of the
subcontractor's obligations is substantially similar to that of a prime
contractor's or general manager's obligations for a development
project; or
[[Page 37116]]
(c) Entry into a contract or subcontract where the consideration
includes a share of ownership in, or participation in the royalties,
earnings, or profits of, the economic development of resources located
in Burma.
Sec. 537.411 [Reserved]
Sec. 537.412 Investments in entities involved in economic development
projects in Burma.
(a) The purchase of shares in a third-country company that is
engaged in the economic development of resources located in Burma is
prohibited by Sec. 537.204 where the company's profits are
predominantly derived from the company's economic development of
resources located in Burma. The purchase of such shares, however, is
authorized by general license pursuant to Sec. 537.530, provided that
all conditions of that general license are satisfied.
(b) If a U.S. person holds shares in an entity which subsequently
engages predominantly in the economic development of resources located
in Burma or subsequently derives its income exclusively or
predominantly from such economic development, the U.S. person is not
required to relinquish its shares. Owning such shares, and purchasing
additional shares is authorized by general license pursuant to Sec.
537.530, provided that all conditions of that general license are
satisfied.
Sec. 537.413 [Reserved]
Sec. 537.414 Charitable contributions.
Unless specifically authorized by OFAC pursuant to this part, no
charitable contribution of funds, goods, services, or technology,
including contributions to relieve human suffering, such as food,
clothing, or medicine, may be made by, to, or for the benefit of, or
received from, a person whose property and interests in property are
blocked pursuant to Sec. 537.201(a). For the purposes of this part, a
contribution is made by, to, or for the benefit of, or received from, a
person whose property and interests in property are blocked pursuant to
Sec. 537.201(a) if made by, to, or in the name of, or received from or
in the name of, such a person; if made by, to, or in the name of, or
received from or in the name of, an entity or individual acting for or
on behalf of, or owned or controlled by, such a person; or if made in
an attempt to violate, to evade, or to avoid the bar on the provision
of contributions by, to, or for the benefit of such a person, or the
receipt of contributions from such a person.
Sec. 537.415 Credit extended and cards issued by U.S. financial
institutions to a person whose property and interests in property are
blocked.
The prohibition in Sec. 537.201 on dealing in property subject to
that section prohibits U.S. financial institutions from performing
under any existing credit agreements, including, but not limited to,
charge cards, debit cards, or other credit facilities issued by a U.S.
financial institution to a person whose property and interests in
property are blocked pursuant to Sec. 537.201(a).
Sec. 537.416 Entities owned by a person whose property and interests
in property are blocked.
A person whose property and interests in property are blocked
pursuant to Sec. 537.201(a) has an interest in all property and
interests in property of an entity in which it owns, directly or
indirectly, a 50 percent or greater interest. The property and
interests in property of such an entity, therefore, are blocked, and
such an entity is a person whose property and interests in property are
blocked pursuant to Sec. 537.201(a), regardless of whether the name of
the entity is incorporated into OFAC's Specially Designated Nationals
and Blocked Persons List (SDN List).
Sec. 537.417 Importation into a bonded warehouse or foreign trade
zone.
The prohibition in Sec. 537.203 applies to importation into a
bonded warehouse or a foreign trade zone of the United States.
Sec. 537.418 Facilitating new investment.
Consistent with Sec. 537.530, U.S. persons may approve, finance,
facilitate, or guarantee new investment by foreign persons provided
such new investment is not pursuant to an agreement, or pursuant to the
exercise of rights under such an agreement, that:
(a) Is entered into with the Burmese Ministry of Defense, state or
non-state armed groups (which includes the military), or entities owned
50 percent or more by any of the foregoing, or
(b) involves a transaction, directly or indirectly, with any person
whose property and interests and property are blocked pursuant to Sec.
537.201(a).
Subpart E--Licenses, Authorizations, and Statements of Licensing
Policy
Sec. 537.501 General and specific licensing procedures.
For provisions relating to licensing procedures, see part 501,
subpart E, of this chapter. Licensing actions taken pursuant to part
501 of this chapter with respect to the prohibitions contained in this
part are considered actions taken pursuant to this part. General
licenses and statements of licensing policy relating to this part also
may be available through the Burma sanctions page on OFAC's Web site:
www.treasury.gov/ofac.
Sec. 537.502 Effect of license or authorization.
(a) No license or other authorization contained in this part, or
otherwise issued by OFAC, authorizes or validates any transaction
effected prior to the issuance of such license or other authorization,
unless specifically provided in such license or authorization.
(b) No regulation, ruling, instruction, or license authorizes any
transaction prohibited under this part unless the regulation, ruling,
instruction, or license is issued by OFAC and specifically refers to
this part. No regulation, ruling, instruction, or license referring to
this part shall be deemed to authorize any transaction prohibited by
any other part of this chapter unless the regulation, ruling,
instruction, or license specifically refers to such part.
(c) Any regulation, ruling, instruction, or license authorizing any
transaction otherwise prohibited under this part has the effect of
removing a prohibition contained in this part from the transaction, but
only to the extent specifically stated by its terms. Unless the
regulation, ruling, instruction, or license otherwise specifies, such
an authorization does not create any right, duty, obligation, claim, or
interest in, or with respect to, any property which would not otherwise
exist under ordinary principles of law.
(d) Nothing contained in this part shall be construed to supersede
the requirements established under any other provision of law or to
relieve a person from any requirement to obtain a license or other
authorization from another department or agency of the U.S. Government
in compliance with applicable laws and regulations subject to the
jurisdiction of that department or agency. For example, exports of
goods, services, or technical data which are not prohibited by this
part or which do not require a license by OFAC, nevertheless may
require authorization by the U.S. Department of Commerce, the U.S.
Department of State, or other agencies of the U.S. Government.
(e) No license or other authorization contained in or issued
pursuant to this part authorizes transfers of or payments from blocked
property or debits to blocked accounts unless the license or other
authorization explicitly authorizes the transfer of or payment from
blocked
[[Page 37117]]
property or the debit to a blocked account.
(f) Any payment relating to a transaction authorized in or pursuant
to this part that is routed through the U.S. financial system should
reference the relevant OFAC general or specific license authorizing the
payment to avoid the blocking or rejection of the transfer.
Sec. 537.503 Exclusion from licenses.
OFAC reserves the right to exclude any person, property,
transaction, or class thereof from the operation of any license or from
the privileges conferred by any license. OFAC also reserves the right
to restrict the applicability of any license to particular persons,
property, transactions, or classes thereof. Such actions are binding
upon actual or constructive notice of the exclusions or restrictions.
Sec. 537.504 Payments and transfers to blocked accounts in U.S.
financial institutions.
Any payment of funds or transfer of credit in which a person whose
property and interests in property are blocked pursuant to Sec.
537.201(a) has any interest that comes within the possession or control
of a U.S. financial institution must be blocked in an account on the
books of that financial institution. A transfer of funds or credit by a
U.S. financial institution between blocked accounts in its branches or
offices is authorized, provided that no transfer is made from an
account within the United States to an account held outside the United
States, and further provided that a transfer from a blocked account may
be made only to another blocked account held in the same name.
Note to Sec. 537.504: See Sec. 501.603 of this chapter for
mandatory reporting requirements regarding financial transfers. See
also Sec. 537.208 concerning the obligation to hold blocked funds
in interest-bearing accounts.
Sec. 537.505 Entries in certain accounts for normal service charges
authorized.
(a) A U.S. financial institution is authorized to debit any blocked
account held at that financial institution in payment or reimbursement
for normal service charges owed it by the owner of that blocked
account.
(b) As used in this section, the term normal service charges shall
include charges in payment or reimbursement for interest due; cable,
telegraph, internet, or telephone charges; postage costs; custody fees;
small adjustment charges to correct bookkeeping errors; and, but not by
way of limitation, minimum balance charges, notary and protest fees,
and charges for reference books, photocopies, credit reports,
transcripts of statements, registered mail, insurance, stationery and
supplies, and other similar items.
Sec. 537.506 Investment and reinvestment of certain funds.
Subject to the requirements of Sec. 537.208, U.S. financial
institutions are authorized to invest and reinvest assets blocked
pursuant to Sec. 537.201(a), subject to the following conditions:
(a) The assets representing such investments and reinvestments are
credited to a blocked account or subaccount that is held in the same
name at the same U.S. financial institution, or within the possession
or control of a U.S. person, but funds shall not be transferred outside
the United States for this purpose;
(b) The proceeds of such investments and reinvestments shall not be
credited to a blocked account or subaccount under any name or
designation that differs from the name or designation of the specific
blocked account or subaccount in which such funds or securities were
held; and
(c) No immediate financial or economic benefit accrues (e.g.,
through pledging or other use) to a person whose property and interests
in property are blocked pursuant to Sec. 537.201(a).
Sec. 537.507 Provision of certain legal services authorized.
(a) The provision of the following legal services to or on behalf
of persons whose property and interests in property are blocked
pursuant to Sec. 537.201(a) is authorized, provided that receipt of
payment of professional fees and reimbursement of incurred expenses
must be specifically licensed or otherwise authorized pursuant to Sec.
537.528:
(1) Provision of legal advice and counseling on the requirements of
and compliance with the laws of the United States or any jurisdiction
within the United States, provided that such advice and counseling are
not provided to facilitate transactions in violation of this part;
(2) Representation of persons named as defendants in or otherwise
made parties to legal, arbitration, or administrative proceedings
before any U.S. federal, state, or local court or agency;
(3) Initiation and conduct of legal, arbitration, or administrative
proceedings before any U.S. federal, state, or local court or agency;
(4) Representation of persons before any U.S. federal, state, or
local court or agency with respect to the imposition, administration,
or enforcement of U.S. sanctions against such persons; and
(5) Provision of legal services in any other context in which
prevailing U.S. law requires access to legal counsel at public expense.
(b) The provision of any other legal services to persons whose
property and interests in property are blocked pursuant to Sec.
537.201(a), not otherwise authorized in this part, requires the
issuance of a specific license.
(c) Entry into a settlement agreement or the enforcement of any
lien, judgment, arbitral award, decree, or other order through
execution, garnishment, or other judicial process purporting to
transfer or otherwise alter or affect property or interests in property
blocked pursuant to Sec. 537.201(a) is prohibited unless licensed
pursuant to this part.
Note to Sec. 537.507: U.S. persons seeking administrative
reconsideration or judicial review of their designation or the
blocking of their property and interests in property may apply for a
specific license from OFAC to authorize the release of a limited
amount of blocked funds for the payment of legal fees where
alternative funding sources are not available. For more information,
see OFAC's Guidance on the Release of Limited Amounts of Blocked
Funds for Payment of Legal Fees and Costs Incurred in Challenging
the Blocking of U.S. Persons in Administrative or Civil Proceedings,
which is available on OFAC's Web site: www.treasury.gov/ofac.
Sec. 537.508 Authorization of emergency medical services.
The provision of nonscheduled emergency medical services in the
United States to persons whose property and interests in property are
blocked pursuant to Sec. 537.201(a) is authorized, provided that all
receipt of payment for such services must be specifically licensed.
Sec. 537.509 Official activities of certain international
organizations authorized.
All transactions and activities otherwise prohibited by this part
that are for the conduct of the official business of the United Nations
or the Specialized Agencies, Programmes, Funds, and Related
Organizations of the United Nations by employees, contractors, or
grantees thereof are authorized.
Note to Sec. 537.509: For an organizational chart listing the
Specialized Agencies, Programmes, Funds, and Related Organizations
of the United Nations, see the following page on the United Nations
Web site: www.un.org/en/aboutun/structure/pdfs/un-system-chart-color-sm.pdf.
[[Page 37118]]
Sec. Sec. 537.510-537.518 [Reserved]
Sec. 537.519 Activities undertaken pursuant to certain pre-May 21,
1997 agreements.
Except as prohibited by Sec. 537.201(a) with respect to persons
whose property and interests in property are blocked pursuant to
Executive Order 13448 of October 18, 2007, Executive Order 13464 of
April 30, 2008, or Executive Order 13619 of July 11, 2012, or by Sec.
537.203, U.S. persons are authorized to engage in any activity, or any
transaction incident to an activity, undertaken pursuant to an
agreement entered into prior to 12:01 a.m., eastern daylight time, on
May 21, 1997, or pursuant to the exercise of rights under such an
agreement, provided that the parties to the agreement include:
(a) The Government of Burma or a nongovernmental entity in Burma,
and
(b) An entity organized under the laws of a foreign state.
Note to Sec. 537.519: The authorization contained in this
section pertains to pre-May 21, 1997 contracts between foreign
entities and either the Government of Burma or a nongovernmental
entity in Burma. A parallel exemption for pre-May 21, 1997 contracts
between U.S. persons and the Government of Burma or a
nongovernmental entity in Burma is contained in Sec. 537.210(d) and
further explained in Sec. 537.409.
Sec. Sec. 537.520-537.521 [Reserved]
Sec. 537.522 Certain transactions related to patents, trademarks,
copyrights, and other intellectual property authorized.
(a) All of the following transactions in connection with patent,
trademark, copyright, or other intellectual property protection in the
United States or Burma are authorized:
(1) The filing and prosecution of any application to obtain a
patent, trademark, copyright, or other form of intellectual property
protection;
(2) The receipt of a patent, trademark, copyright, or other form of
intellectual property protection;
(3) The renewal or maintenance of a patent, trademark, copyright,
or other form of intellectual property protection;
(4) The filing and prosecution of opposition or infringement
proceedings with respect to a patent, trademark, copyright, or other
form of intellectual property protection, or the entrance of a defense
to any such proceedings; and
(5) The assignment or transfer of a patent, trademark, copyright,
or other form of intellectual property protection.
(b) This section authorizes the payment of fees currently due to
the United States Government or the Government of Burma, or of the
reasonable and customary fees and charges currently due to attorneys or
representatives within the United States or Burma, in connection with
the transactions authorized in paragraph (a) of this section, except
that payment effected pursuant to the terms of this paragraph may not
be made from a blocked account.
Sec. Sec. 537.523-537.525 [Reserved]
Sec. 537.526 Transactions necessary and ordinarily incident to
publishing authorized.
To the extent that such activities are not exempt from this part,
U.S. persons are authorized to engage in all transactions otherwise
prohibited by Sec. 537.201 that are necessary and ordinarily incident
to the publishing and marketing of manuscripts, books, journals, and
newspapers in paper or electronic format (collectively, ``written
publications''). This section does not apply if the parties to the
transactions described in this paragraph include the State Peace and
Development Council of Burma or the Union Solidarity and Development
Association of Burma; any successor entity to any of the foregoing
entities; or any person, other than personnel of academic and research
institutions, acting or purporting to act directly or indirectly on
behalf of the foregoing entities with respect to the transactions
described in this paragraph. Pursuant to this section, transactions
incident to the following activities are authorized, provided they do
not involve any importations prohibited by Sec. 537.203:
(a) Commissioning and making advance payments for identifiable
written publications not yet in existence, to the extent consistent
with industry practice;
(b) Collaborating on the creation and enhancement of written
publications;
(c)(1) Augmenting written publications through the addition of
items such as photographs, artwork, translation, explanatory text, and,
for a written publication in electronic format, the addition of
embedded software necessary for reading, browsing, navigating, or
searching the written publication;
(2) Exporting embedded software necessary for reading, browsing,
navigating, or searching a written publication in electronic format,
provided that, to the extent a license is required under the Export
Administration Regulations, 15 CFR parts 730-774 (EAR), the exportation
is licensed or otherwise authorized by the Department of Commerce under
the provisions of the EAR;
(d) Substantive editing of written publications;
(e) Payment of royalties for written publications;
(f) Creating or undertaking a marketing campaign to promote a
written publication; and
(g) Other transactions necessary and ordinarily incident to the
publishing and marketing of written publications as described in this
section.
Note 1 to Sec. 537.526: The Department of State has determined
that the State Peace and Development Council of Burma no longer
exists.
Note 2 to Sec. 537.526: See Sec. 537.529 for a general
license authorizing the exportation or reexportation of financial
services to Burma.
Sec. 537.527 [Reserved]
Sec. 537.528 Payments for legal services from funds originating
outside the United States authorized.
Receipts of payment of professional fees and reimbursement of
incurred expenses for the provision of legal services authorized
pursuant to Sec. 537.507(a) to or on behalf of any person whose
property and interests in property are blocked pursuant to Sec.
537.201(a) are authorized from funds originating outside the United
States, provided that:
(a) Prior to receiving payment for legal services authorized
pursuant to Sec. 537.507(a) rendered to persons whose property and
interests in property are blocked pursuant to Sec. 537.201(a), the
U.S. person that is an attorney, law firm, or legal services
organization provides to OFAC a copy of a letter of engagement or a
letter of intent to engage specifying the services to be performed and
signed by the individual to whom such services are to be provided or,
where services are to be provided to an entity, by a legal
representative of the entity. The copy of a letter of engagement or a
letter of intent to engage, accompanied by correspondence referencing
this paragraph (a), is to be mailed to: Licensing Division, Office of
Foreign Assets Control, U.S. Department of the Treasury, 1500
Pennsylvania Avenue NW., Annex, Washington, DC 20220;
(b) The funds received by U.S. persons as payment of professional
fees and reimbursement of incurred expenses for the provision of legal
services authorized pursuant to Sec. 537.507(a) must not originate
from:
(1) A source within the United States;
(2) Any source, wherever located, within the possession or control
of a U.S. person; or
(3) Any individual or entity, other than the person on whose behalf
the legal services authorized pursuant to Sec. 537.507(a) are to be
provided, whose property and interests in property are
[[Page 37119]]
blocked pursuant to any part of this chapter or any Executive order;
Note to Sec. 537.528(b): This paragraph authorizes the blocked
person on whose behalf the legal services authorized pursuant to
Sec. 537.507(a) are to be provided to make payments for authorized
legal services using funds originating outside the United States
that were not previously blocked. Nothing in this paragraph
authorizes payments for legal services using funds in which any
other person whose property and interests in property are blocked
pursuant to Sec. 537.201(a), any other part of this chapter, or any
Executive order holds an interest.
(c) Reports. (1) U.S. persons who receive payments in connection
with legal services authorized pursuant to Sec. 537.507(a) must submit
quarterly reports no later than 30 days following the end of the
calendar quarter during which the payments were received providing
information on the funds received. Such reports shall specify:
(i) The individual or entity from whom the funds originated and the
amount of funds received; and
(ii) If applicable:
(A) The names of any individuals or entities providing related
services to the U.S. person receiving payment in connection with
authorized legal services, such as private investigators or expert
witnesses;
(B) A general description of the services provided; and
(C) The amount of funds paid in connection with such services.
(2) In the event that no transactions occur or no funds are
received during the reporting period, a statement is to be filed to
that effect; and
(3) The reports, which must reference this section, are to be
mailed to: Licensing Division, Office of Foreign Assets Control, U.S.
Department of the Treasury, 1500 Pennsylvania Avenue NW., Annex,
Washington, DC 20220.
Note to Sec. 537.528: U.S. persons who receive payments in
connection with legal services authorized pursuant to Sec.
537.507(a) do not need to obtain specific authorization to contract
for related services that are ordinarily incident to the provision
of those legal services, such as those provided by private
investigators or expert witnesses, or to pay for such services.
Additionally, U.S. persons do not need to obtain specific
authorization to provide related services that are ordinarily
incident to the provision of legal services authorized pursuant to
Sec. 537.507(a).
Sec. 537.529 Exportation or reexportation of financial services to
Burma authorized.
(a) Except as provided in paragraphs (b)-(d) of this section, the
exportation or reexportation of financial services to Burma, directly
or indirectly, from the United States or by a U.S. person, wherever
located, is authorized.
(b) This section does not authorize, in connection with the
provision of security services, the exportation or reexportation of
financial services, directly or indirectly, to the Burmese Ministry of
Defense, including the Office of Procurement; any state or non-state
armed group; or any entity in which any of the foregoing own a 50
percent or greater interest.
(c) This section does not authorize the exportation or
reexportation of financial services, directly or indirectly, to any
person whose property and interests in property are blocked pursuant to
Sec. 537.201(a), except as set forth in Sec. 537.404(b).
Note to Sec. 537.529(c): See Sec. 537.531 for a general
license authorizing transactions involving certain Burmese financial
institutions whose property and interests in property are blocked
pursuant to Sec. 537.201(a), including establishing and maintaining
accounts on the books of U.S. financial institutions.
(d) This section does not authorize any debit to a blocked account.
Note to Sec. 537.529: As a result of the authorization
contained in this section, the special measures against Burma
imposed under Section 311 of the Uniting and Strengthening America
by Providing Appropriate Tools Required to Intercept and Obstruct
Terrorism (USA PATRIOT) Act of 2001 (Pub. L. 107-56) (USA PATRIOT
Act) do not apply to the operation of correspondent accounts for
Burmese financial institutions, or to transactions that are
conducted through those accounts, provided the Burmese financial
institution is not an entity whose property and interests in
property are blocked pursuant to Sec. 537.201(a) and the
transactions are otherwise authorized by this part, and therefore
fall within the exception set forth in 31 CFR 1010.651(b)(3). In
addition, section 537.531 of this part authorizes certain
transactions involving specific Burmese financial institutions whose
property and interests in property are blocked pursuant to this
part. This section does not affect any obligation of U.S. financial
institutions processing such transactions to conduct enhanced due
diligence under Section 312 of the USA PATRIOT Act. See 31 CFR
1010.610(c).
Sec. 537.530 New investment in Burma by U.S. persons authorized.
(a) Except as provided in paragraphs (c) and (d) of this section,
new investment, as defined in Sec. 537.311, in Burma by U.S. persons
is authorized.
(b) Any U.S. person engaging in new investment in Burma pursuant to
this section must report to the Department of State in compliance with
the requirements set forth in the Department of State's ``Reporting
Requirements on Responsible Investment in Burma,'' available at:
www.HumanRights.gov/BurmaResponsibleInvestment.
(c) This section does not authorize new investment undertaken
pursuant to an agreement, or pursuant to the exercise of rights under
such an agreement, that is entered into with the Burmese Ministry of
Defense, including the Office of Procurement; any state or non-state
armed group; or any entity in which any of the foregoing own a 50
percent or greater interest.
(d) This section does not authorize transactions with, directly or
indirectly, any person whose property and interests in property are
blocked pursuant to Sec. 537.201(a).
Note to Sec. 537.530: The Department of State, pursuant to
section 570(e) of the Foreign Operations, Export Financing, and
Related Programs Appropriations Act, 1997 (Pub. L. 104-208) and a
delegation of authority by the President, has waived the prohibition
on new investment in Burma authorized in section 570 of that act.
See 77 Fed. Reg. 62596 (Oct. 15, 2012).
Sec. 537.531 Certain transactions involving Asia Green Development
Bank, Ayeyarwady Bank, Myanma Economic Bank, and Myanma Investment and
Commercial Bank authorized.
(a) Except as provided in paragraphs (b) through (f) of this
section, all transactions involving Asia Green Development Bank,
Ayeyarwady Bank, Myanma Economic Bank, and Myanma Investment and
Commercial Bank are authorized.
(b) This section does not authorize transactions involving any
person whose property and interests in property are blocked pursuant to
Sec. 537.201(a) other than Asia Green Development Bank, Ayeyarwady
Bank, Myanma Economic Bank, and Myanma Investment and Commercial Bank.
(c) This section does not authorize, in connection with the
provision of security services, the exportation or reexportation of
financial services, directly or indirectly, to the Burmese Ministry of
Defense, including the Office of Procurement; any state or non-state
armed group; or any entity in which any of the foregoing own a 50
percent or greater interest.
(d) This section does not authorize any new investment, as defined
in Sec. 537.311, including in or with Asia Green Development Bank,
Ayeyarwady Bank, Myanma Economic Bank, or Myanma Investment and
Commercial Bank.
(e) This section does not authorize any importations into the
United States prohibited by Sec. 537.203.
(f) This section does not authorize the unblocking of any property
and interests
[[Page 37120]]
in property that were blocked as of February 22, 2013, pursuant to 31
CFR Sec. 537.201(a), Executive Order 13448 of October 18, 2007,
Executive Order 13464 of April 30, 2008, or Executive Order 13619 of
July 11, 2012.
Note to Sec. 537.531: As a result of the authorization
contained in this section, the special measures against Burma
imposed under Section 311 of the Uniting and Strengthening America
by Providing Appropriate Tools Required to Intercept and Obstruct
Terrorism (USA PATRIOT) Act of 2001 (Pub. L. 107-56) (USA PATRIOT
Act) do not apply to the operation of correspondent accounts for
Asia Green Development Bank, Ayeyarwady Bank, Myanma Economic Bank,
and Myanma Investment and Commercial Bank, or to transactions
conducted through such accounts, provided the transactions are
authorized pursuant to this part, and therefore fall within the
exception set forth in 31 CFR 1010.651(b)(3). This section does not
affect any obligation of U.S. financial institutions processing such
transactions to conduct enhanced due diligence under Section 312 of
the USA PATRIOT Act. See 31 CFR 1010.610(c).
Subpart F--Reports
Sec. 537.601 Records and reports.
For provisions relating to required records and reports, see part
501, subpart C, of this chapter. Recordkeeping and reporting
requirements imposed by part 501 of this chapter with respect to the
prohibitions contained in this part are considered requirements arising
pursuant to this part.
Subpart G--Penalties
Sec. 537.701 Penalties.
(a) Attention is directed to section 206 of the International
Emergency Economic Powers Act (50 U.S.C. 1705) (IEEPA), which is
applicable to violations of the provisions of any license, ruling,
regulation, order, directive, or instruction issued by or pursuant to
the direction or authorization of the Secretary of the Treasury
pursuant to this part or otherwise under IEEPA.
(1) A civil penalty not to exceed the amount set forth in section
206 of IEEPA may be imposed on any person who violates, attempts to
violate, conspires to violate, or causes a violation of any license,
order, regulation, or prohibition issued under IEEPA.
Note to Sec. 537.701(a)(1): As of the date of publication in
the Federal Register of the final rule amending and reissuing this
part (June 30, 2014), IEEPA provides for a maximum civil penalty not
to exceed the greater of $250,000 or an amount that is twice the
amount of the transaction that is the basis of the violation with
respect to which the penalty is imposed.
(2) A person who willfully commits, willfully attempts to commit,
or willfully conspires to commit, or aids or abets in the commission of
a violation of any license, order, regulation, or prohibition may, upon
conviction, be fined not more than $1,000,000, or if a natural person,
be imprisoned for not more than 20 years, or both.
(b) Adjustments to penalty amounts. (1) The civil penalties
provided in IEEPA are subject to adjustment pursuant to the Federal
Civil Penalties Inflation Adjustment Act of 1990 (Pub. L. 101-410, as
amended, 28 U.S.C. 2461 note).
(2) The criminal penalties provided in IEEPA are subject to
adjustment pursuant to 18 U.S.C. 3571.
(c) Attention is also directed to 18 U.S.C. 1001, which provides
that whoever, in any matter within the jurisdiction of the executive,
legislative, or judicial branch of the Government of the United States,
knowingly and willfully falsifies, conceals, or covers up by any trick,
scheme, or device a material fact, or makes any materially false,
fictitious, or fraudulent statement or representation, or makes or uses
any false writing or document knowing the same to contain any
materially false, fictitious, or fraudulent statement or entry shall be
fined under title 18, United States Code, or imprisoned, or both.
(d) Violations of this part may also be subject to other applicable
laws.
Note to Sec. 537.701: The Tom Lantos Block Burmese JADE
(Junta's Anti-Democratic Efforts) Act of 2008 (the ``JADE Act'')
provides that any person who violates any prohibition imposed
pursuant to Section 5(b) of the JADE Act shall be subject to the
penalties provided in IEEPA. In Executive Order 13651 of August 6,
2013, the President waived pursuant to Section 5(i) of JADE Act the
blocking and financial sanctions described in Section 5(b) of the
JADE Act.
Sec. 537.702 Pre-Penalty Notice; settlement.
(a) When required. If OFAC has reason to believe that there has
occurred a violation of any provision of this part or a violation of
the provisions of any license, ruling, regulation, order, direction, or
instruction issued by or pursuant to the direction or authorization of
the Secretary of the Treasury pursuant to this part or otherwise under
the International Emergency Economic Powers Act (50 U.S.C. 1705)
(IEEPA) and determines that a civil monetary penalty is warranted, OFAC
will issue a Pre-Penalty Notice informing the alleged violator of the
agency's intent to impose a monetary penalty. A Pre-Penalty Notice
shall be in writing. The Pre-Penalty Notice may be issued whether or
not another agency has taken any action with respect to the matter. For
a description of the contents of a Pre-Penalty Notice, see Appendix A
to part 501 of this chapter.
(b)(1) Right to respond. An alleged violator has the right to
respond to a Pre-Penalty Notice by making a written presentation to
OFAC. For a description of the information that should be included in
such a response, see Appendix A to part 501 of this chapter.
(2) Deadline for response. A response to a Pre-Penalty Notice must
be made within the applicable 30-day period set forth in this
paragraph. The failure to submit a response within the applicable time
period set forth in this paragraph shall be deemed to be a waiver of
the right to respond.
(i) Computation of time for response. A response to a Pre-Penalty
Notice must be postmarked or date-stamped by the U.S. Postal Service
(or foreign postal service, if mailed abroad) or courier service
provider (if transmitted to OFAC by courier) on or before the 30th day
after the postmark date on the envelope in which the Pre-Penalty Notice
was mailed. If the Pre-Penalty Notice was personally delivered by a
non-U.S. Postal Service agent authorized by OFAC, a response must be
postmarked or date-stamped on or before the 30th day after the date of
delivery.
(ii) Extensions of time for response. If a due date falls on a
federal holiday or weekend, that due date is extended to include the
following business day. Any other extensions of time will be granted,
at the discretion of OFAC, only upon specific request to OFAC.
(3) Form and method of response. A response to a Pre-Penalty Notice
need not be in any particular form, but it must be typewritten and
signed by the alleged violator or a representative thereof, must
contain information sufficient to indicate that it is in response to
the Pre-Penalty Notice, and must include the OFAC identification number
listed on the Pre-Penalty Notice. A copy of the written response may be
sent by facsimile, but the original also must be sent to OFAC's
Enforcement Division by mail or courier and must be postmarked or date-
stamped in accordance with paragraph (b)(2) of this section.
(c) Settlement. Settlement discussion may be initiated by OFAC, the
alleged violator, or the alleged violator's authorized representative.
For a description of practices with respect to settlement, see Appendix
A to part 501 of this chapter.
[[Page 37121]]
(d) Guidelines. Guidelines for the imposition or settlement of
civil penalties by OFAC are contained in Appendix A to part 501 of this
chapter.
(e) Representation. A representative of the alleged violator may
act on behalf of the alleged violator, but any oral communication with
OFAC prior to a written submission regarding the specific allegations
contained in the Pre-Penalty Notice must be preceded by a written
letter of representation, unless the Pre-Penalty Notice was served upon
the alleged violator in care of the representative.
Sec. 537.703 Penalty imposition.
If, after considering any written response to the Pre-Penalty
Notice and any relevant facts, OFAC determines that there was a
violation by the alleged violator named in the Pre-Penalty Notice and
that a civil monetary penalty is appropriate, OFAC may issue a Penalty
Notice to the violator containing a determination of the violation and
the imposition of the monetary penalty. For additional details
concerning issuance of a Penalty Notice, see Appendix A to part 501 of
this chapter. The issuance of the Penalty Notice shall constitute final
agency action. The violator has the right to seek judicial review of
that final agency action in federal district court.
Sec. 537.704 Administrative collection; referral to United States
Department of Justice.
In the event that the violator does not pay the penalty imposed
pursuant to this part or make payment arrangements acceptable to OFAC,
the matter may be referred for administrative collection measures by
the Department of the Treasury or to the United States Department of
Justice for appropriate action to recover the penalty in a civil suit
in a federal district court.
Subpart H--Procedures
Sec. 537.801 Procedures.
For license application procedures and procedures relating to
amendments, modifications, or revocations of licenses; administrative
decisions; rulemaking; and requests for documents pursuant to the
Freedom of Information and Privacy Acts (5 U.S.C. 552 and 552a), see
part 501, subpart E, of this chapter.
Sec. 537.802 Delegation by the Secretary of the Treasury.
Any action that the Secretary of the Treasury is authorized to take
pursuant to the Tom Lantos Block Burmese JADE (Junta's Anti-Democratic
Efforts) Act of 2008 (Pub. L. 110-286); Executive Order 13047 of May
20, 1997, Executive Order 13310 of July 28, 2003, Executive Order 13448
of October 18, 2007, Executive Order 13464 of April 30, 2008, Executive
Order 13619 of July 11, 2012, Executive Order 13651 of August 6, 2013,
and any further Executive orders relating to the national emergency
declared in Executive Order 13047, may be taken by the Director of OFAC
or by any other person to whom the Secretary of the Treasury has
delegated authority so to act.
Subpart I--Paperwork Reduction Act
Sec. 537.901 Paperwork Reduction Act notice.
For approval by the Office of Management and Budget (OMB) under the
Paperwork Reduction Act of 1995 (44 U.S.C. 3507) of information
collections relating to recordkeeping and reporting requirements,
licensing procedures (including those pursuant to statements of
licensing policy), and other procedures, see Sec. 501.901 of this
chapter. An agency may not conduct or sponsor, and a person is not
required to respond to, a collection of information unless it displays
a valid control number assigned by OMB.
Dated: June 18, 2014.
Barbara C. Hammerle,
Acting Director, Office of Foreign Assets Control.
Approved: June 18, 2014.
David S. Cohen,
Under Secretary, Office of Terrorism and Financial Intelligence,
Department of the Treasury.
[FR Doc. 2014-14841 Filed 6-25-14; 4:15 pm]
BILLING CODE 4810-AL-P