Updated General Licenses in relation to the US Sanctions against Venezuela

Previously, the US President has issued various Executive Orders ("EO"s) to stop the human rights abuses and antidemocratic actions of the regime of Venezuelan President Nicolas Maduro. Various General Licenses, issued by OFAC, do however provide exemptions from the EO provisions in order to minimize the impact on the Venezuelan people and US interests.

On 8March 2019, OFAC issued two General Licences relating to certain Venezuelan bonds and state-owned oil company Petroleos de Venezuela S.A. ("PdVSA") securities, see General Licences 3D and 9C respectively. The two General Licences extend the expiration dates of their previous versions. In consequence, the deadlines for winding down certain financial contracts or other agreements involving, or linked to, the bonds listed on the Annex to General License 3D, and to certain PdVSA securities (General Licence 9C), are extended, see OFAC Notice.

Such General Licences do, within timeframes, allow for transactions involving the Venezuelan Government and/or PdSVA that would otherwise be prohibited under EO 13850 of 1 November 2018 ("Blocking property of Additional Persons Contributing to the Situation in Venezuela") and EO 13808 of August 2017 ("Imposing Additional Sanctions With Respect to the Situation in Venezuela"). EO 13850 is meant to counter the rampant corruption within the Government of Venezuela by blocking assets of, and prohibit certain transactions with, targeted persons operating within, inter alia, the oil sector of the Venezuelan economy. EO 13808 prohibits access for the Venezuelan Government to the US financial (debt and equity) markets, imposed to prevent the Maduro regime from selling assets, such as bonds and securities, to finance the regime. The state-owned oil company PdVSA, and in effect also its subsidiaries, are currently designated underboth such EOs, as the company  according to the US Government has been used by Maduro to "control, manipulate and steal from the Venezuelan people".

Updated versions of OFAC's detailed explanations of the content and effects of the new General Licences 9C and 3D may be found in OFAC FAQs 661 and 662 respectively.

Following the US' formal recognition of the presidency of interim President Juan Guaidó on 23 January 2019, the US Government has announced that it will continue to use economic sanctions to try to oust Maduro.  

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