US issues updated General License 7A in relation to sanctions against Venezuela
Last week, we informed that OFAC had issued General Licences 3D and 9C relating to certain Venezuelan bonds and Petroleos de Venezuela S.A. ("PdVSA") securities. Yesterday, OFAC issued yet another General Licence relating to US sanctions against Venezuela.
Yesterday, on 14 March 2019, OFAC issued General Licence 7A. OFAC thereby extended the expiration date of a general licence relating to US entities PDV Holding, Inc. ("PDVH") and CITGO Holding Inc. ("CITGO"). OFAC thus extended the already existing exemptions from Executive Order ("EO") 13850 relating to PDVH, CITGO or any of their subsidiaries, see OFAC Press Release.
As we informed in our previous sanctions update on US sanctions against Venezuela, EO 13850 prohibits dealing with designated persons and entities operating within inter alia the oil sector of the Venezuelan economy. Venezuelan state-owned PdVSA is designated for its ties with President Nicolas Maduro. As both PDVH and CITGO are US entities owned by PdVSA, also PDVH and CITGO are, in effect, deemed as entities designated under EO 13850. General Licence 7A however provides exemptions from the prohibitions set out in EO 13850 with respect to PDVH and CITGO. In order to minimize the sanctions' impact on US interests, General Licence 7A allows – within timeframes – for transactions and activities involving PDVH and CITGO that would otherwise be prohibited.