On January 18, 2024, the Department of the Treasury’s Office of Foreign Assets Control (OFAC) announced the imposition of sanctions against a United Arab Emirates-based shipping company, Hennesea Holdings Limited (“Hennesea”) and eighteen vessels ultimately owned by Hennesea for violations of the Russian Price Cap Policy.
OFAC determined that shortly before the price cap went into effect, Hennesea acquired older tankers that ship Russian crude oil and petroleum products. These tankers have repeatedly conducted port calls in Russian Federation ports.
Hennesea was designated as a Specially Designated National (“SDN”) pursuant to E.O. 14024 for operating or having operated in the marine sector of the Russian Federation economy.
OFAC also designated the following eighteen vessels as SDNs, which are beneficially owned by Hennesea, as property in which Hennesea has an interest:
- ARISTO (IMO 9327413)
- HAI II (IMO 9259599)
- HS ARGE (IMO 9299745)
- HS ATLANTICA (IMO 9322839)
- HS BURAQ (IMO 9381732)
- HS ESBERG (IMO 9410894)
- HS EVERETT (IMO 9410870)
- HS GLORY (IMO 9249087)
- HS LEGEND (IMO 9381744)
- HS STAR (IMO 9274446)
- LA PRIDE (IMO 9274616)
- MONA (IMO 9314818)
- NELLIS (IMO 9322267)
- OSPEROUS (IMO 9412995)
- PERIA (IMO 9322827)
- SARA II (IMO 9301615)
- SENSUS (IMO 9296585)
- UZE (IMO 9323338)
One of Hennesea’s vessels, HS Atlantica, and one of Hennesea’s subsidiaries, Liberia-based HS Atlantica Limited, were previously designated on December 1, 2023, for engaging in the transport of Russian origin crude oil above the price cap while utilizing U.S.-person services.
As the first price cap-related sanctions of 2024, these designations signal OFAC’s continued commitment to enforcement of the Price Cap Policy. Indeed, in its press release, OFAC warned that “anyone who violates the price cap will face the consequences.”
In addition, a reporting requirement is also triggered upon the imposition of blocking sanctions. All property or any interests in property that are in the United States or in the possession or control of U.S. persons of the persons designated by OFAC are blocked. Those property interests must be reported to OFAC. In addition, any entities that are owned, directly or indirectly, 50 percent or more by one or more blocked persons are also blocked. Persons in possession of blocked property generally have ten business days to file initial reports on blocked property with OFAC.
We will continue to closely monitor developments in this space.
