US Treasury OFAC Sanctions: Understanding Key Compliance Lists

The Office of Foreign Assets Control (OFAC) under the US Department of the Treasury is responsible for implementing and enforcing US economic and trade sanctions.The currently implemented sanctions include: Specially Designated Nationals List (abbreviated as SDN),Foreign Sanctions Evaders List (abbreviated as FSE),Sectoral Sanctions Identifications List (abbreviated as SSI),Non-SDN Palestinian Legislative Council List (abbreviated as NS - PLC),Correspondent Account and Payable - Through Account Sanctions List (abbreviated as CAPTA),Non - SDN Menu - Based Sanctions List (abbreviated as NS - MBS),Non - SDN Chinese Military - Industrial Complex Companies List (abbreviated as NS - CMIC).The following is a brief description of the sanctions lists:

(I) Specially Designated Nationals List (SDN): This is the most well - known OFAC sanctions list,including individuals,entities,and organizations involved in terrorist activities,drug smuggling,weapons proliferation,and other activities considered a threat to the United States.The assets of individuals and entities on the SDN list are frozen within the United States,and US citizens are prohibited from conducting any transactions with them.

As of July 4,2023,a total of 289 Mainland Chinese entities have been included in the US SDN,including 127 enterprises,159 individuals,and 3 government agencies.Chinese entities were first included in the SDN list in 1994.

(II) Foreign Sanctions Evaders List (FSE): This list includes non - US entities that are believed to be deliberately evading US sanctions.

Unlike the SDN,the FSE does not freeze the property of entities on the list (unless they are also included in the SDN).

(III) Sectoral Sanctions Identifications List (SSI): This list targets entities operating in specific industries,especially those related to the sensitive industries of specific countries,such as the energy,defense,and financial sectors.

SSI was initially established in response to the 2014 Crimea crisis.On March 20,2014,after then-President Obama issued Executive Order 13662,OFAC published a list to enable the U.S.Treasury Secretary to identify entities in Russias economic sector under the order.Entities on the SSI list may also appear on the SDN list,and the SSI list is also subject to the 50% rule.

The SSI primarily targets four key economic sectors in Russia: finance,energy,defense,and oil extraction/production.It prohibits U.S.persons and entities with "connections" to the United States from engaging in specific activities within these four sectors.

Unlike the SDN,companies included in the SSI do not face asset freezes,and Americans are not strictly prohibited from conducting transactions with them.The sanctions on entities in the SSI are more targeted,aiming to cut off their access to specific types of financing channels.

(IV) Non - SDN Palestinian Legislative Council List (NS - PLC): This list involves entities related to the Palestinian Legislative Council but not included in the SDN list.

(V) Correspondent Account and Payable - Through Account Sanctions List (CAPTA): This list targets financial institutions that assist specific sanctioned entities in conducting financial transactions.

The CAPTA list may be used in conjunction with other sanctions lists,but foreign financial institutions that have already entered the SDN list will not be included.

(VI) Non - SDN Menu - Based Sanctions List (NS - MBS): This is a sanctions list for specific individuals and entities that are not included in the SDN list,with a total of 12 sanctioning measures.

On December 21,2020,the US Department of State,in consultation with OFAC,included the Turkish Defense Industry Directorate (SSB) in the NS - MBS.The SSB is Turkeys main defense procurement entity.OFAC imposed 5 out of the 12 sanctions on the SSB.

(VII) Non - SDN Chinese Military - Industrial Complex Companies List (NS - CMIC): This list includes companies that the United States believes are related to or controlled by the Chinese military.

As of July 4,2023,a total of 68 companies have been included in this list.Since it came into effect in August 2021,only 9 new companies have been added.

The Office of Foreign Assets Control of the US Department of the Treasury (OFAC) provides an email subscription service to notify of updates to the sanctions lists.By subscribing to OFACs email notifications,you can obtain the latest sanctions lists,changes,and related announcements in a timely manner.

How to subscribe to OFACs email notifications?

Output:

• VisitOFACsemailsubscriptionpage:,whichmayrequiretoolstoaccessinChina.
• Enteryouremailaddress:EnteryouremailaddressinthedesignatedfieldandthenclickSubmit.
• Selectthetypesofupdatesyouareinterestedin:Youcanchoosetoreceivedifferenttypesofnotifications,suchas:
  • SDNlistupdate(SpeciallyDesignatedNationalsandBlockedPersonsList)
  • Sanctionsprogramupdates
  • FrequentlyAskedQuestions
  • Newregulationsandguidancedocuments
• Confirm subscription: Follow the on - page instructions to complete the subscription process.You may need to confirm your email address.