Biden Administration Issues Executive Order Re-Imposing Sanctions On Burma

Morrison & Foerster LLP

On February 11, 2021, President Biden issued Executive Order 14014 of February 10, 2021, “Blocking Property With Respect to the Situation in Burma” (“E.O. 14014”), the first sanctions-related E.O. of his new administration, declaring a national emergency to deal with the situation in, and in relation to, Burma following the February 1, 2021 coup. This move marks the U.S. government’s reestablishment of a Burma-specific sanctions regime, after the prior program was terminated in 2016 by President Obama. 

Key Takeaways

1. New additions to the Treasury Department’s Specially Designated Nationals and Blocked Persons List (“SDN List”). The Biden administration has imposed new sanctions on 10 influential Burmese individuals and three businesses following the February 1, 2021 coup in that country, with more sanctions expected in the coming weeks.

2. Like most “targeted” U.S. sanctions programs, the new E.O. does not generally prohibit transactions with the government of Burma, or restrict trade with Burma, but merely forbids transactions with a “U.S. nexus” involving, directly or indirectly, parties added to the SDN List.

3. Practice proactive due diligence. In addition to terminating all business activities involving the designated individuals and entities, global businesses should closely examine their ties to Burma and assess potential risks. In particular, companies should identify any business that touches the Burmese defense sector or that involves current government or military leaders, because such entities are far more likely to be subject to future sanctions (to the extent they are not already sanctioned). 

The New Burmese Sanctions Regime

E.O. 14014 authorizes the imposition of sanctions on any foreign person determined to operate in certain sectors of the Burmese economy, as well as any foreign person determined to have engaged in a range of activities contributing to the unrest in Burma. The E.O. specifically identifies the Burmese defense sector as subject to sectoral sanctions – meaning that the U.S. Treasury Department can sanction anyone deemed to operate in that sector – and it also authorizes the Secretary of the Treasury, in consultation with the Secretary of State, to subsequently identify additional sectors of the Burmese economy within which any person determined to be operating may be sanctioned. It also allows for the imposition of sanctions on any Burmese military or government leader or official holding office as of February 2, 2021, including their adult family members. Once designated, these individuals and entities are placed on the SDN List maintained by the Treasury Department’s Office of Foreign Assets Control (OFAC), and all property and interests in property subject to U.S. jurisdiction of these sanctioned persons are blocked. U.S. persons are generally prohibited from engaging in any transactions or dealings with listed parties. 

Shortly following President Biden’s issuance of E.O. 14014, OFAC announced that it had designated and added to the SDN List 10 current and former Burmese military officials and three Burmese entities that are owned or controlled by, or have acted for or on behalf of, the military or security forces of Burma. Of these 10 officials, six are members of the National Defense and Security Council who were directly involved in the coup. The remaining four are members of the newly established State Administration Council. 

At the same time as the issuance of the E.O. and imposition of the OFAC sanctions, the U.S. Commerce Department’s Bureau of Industry and Security (BIS) announced that it will implement a series of restrictions on exports of sensitive items to certain Burmese military and government entities. Specifically, BIS will apply a presumption of denial for export license applications to designated Burmese governmental agencies, and BIS revoked certain previously issued licenses to the Burmese government. In addition, BIS will suspend certain license exceptions previously available to Burma under the Export Administration Regulations. As a result of these actions, persons exporting U.S.-origin items to Burma will need to reevaluate the export control status of the items.

According to a statement by Secretary of State Antony Blinken, the new Burmese sanctions regime has been narrowly tailored to specifically target those “who played a leading role in the overthrow of Burma’s democratically-elected government.” Secretary Blinken also stressed that the U.S. government will ensure that these measures do not add to the humanitarian plight of the Burmese people.

Prior Sanctions on Burma

Although E.O. 14014 reestablishes a Burma-specific U.S. sanctions program for the first time since 2016, a number of powerful Burmese persons were already sanctioned in other programs. In particular, two of the officials designated in this latest round of sanctions were previously sanctioned due to their involvement in human rights abuses against the Rohingya people. 

The U.S. government’s prior Burma-specific sanctions program, which was terminated by President Obama in 2016, included prohibitions targeting Burma’s precious gem and financial sectors. In contrast to those restrictions, E.O. 14014 does not impose an outright ban on the importation of Burmese-origin jadeite and rubies. However, we note that the three entities that were designated on February 11, 2021 are the Myanmar Ruby Enterprise, the Myanmar Imperial Jade Co., Ltd., and Cancri (Gems and Jewellery) Co., Ltd., which will most likely cause a similar chilling effect on dealings with the Burmese precious gem sector.

MoFo’s National Security practice will continue to monitor the situation and keep you apprised of any significant developments.


Liv Chap, a Law Clerk in Morrison & Foerster LLP’s D.C. office and Raymond Rif, a legislative and policy specialist in the Morrison & Foerster LLP National Security practice, contributed to this alert.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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