The Bass, Berry & Sims international trade team is actively monitoring the situation in Russia and Ukraine and providing real-time advice to clients on managing the situation. This post summarizes new U.S. sanctions and export restrictions as of April 7. This post supplements our previous summaries, which are available by following the links at the bottom of this page.

Commerce Issues Temporary Denial Orders Against Three Russian Airlines

Today, the U.S. Department of Commerce, Bureau of Industry and Security (BIS) issued Temporary Denial Orders (TDOs) denying the export privileges of three Russian airlines – Aeroflot, Azur Air, and UTair.  In announcing this action, BIS stated that the three airlines are continuing to violate comprehensive U.S. export controls imposed on Russia.  The TDOs extend for 180-days and may be renewed.  The TDOs terminate the right of these airlines to participate in transactions subject to the Export Administration Regulations (EAR), including exports from the United States and re-exports from abroad.

According to BIS, the TDOs were issued to prevent imminent and continual violation of the EAR.  In particular, BIS noted that it had used publicly available flight tracking data to show multiple flights into and out of Russia by the three airlines without BIS authorization.  BIS further noted that domestic Russia flights by the three airlines, as well as servicing of the U.S.-origin aircraft, would violate General Prohibition 10 of the EAR.  Many of the aircraft BIS identified on its March 18 (see our March 21 post) and March 30 (see our April 1 post) press releases are operated by these three airlines.

White House Issues Order to Prohibit Investments in Russia

Also today, the White House issued Executive Order 14071 (EO) prohibiting new investments and the provision of certain services in Russia.  The EO prohibits new investment in Russia by a U.S. person, wherever located, and the export, re-export, sale or supply, directly or indirectly, from the United States or by a U.S. person of “any category of services as may be determined by the Secretary of the Treasury, in consultation with the Secretary of State,” to any person located in Russia.  Treasury has not yet announced the category of services.

U.S. persons are also prohibited from approving, financing, facilitating, or guaranteeing a transaction by a foreign person if it would be prohibited if performed by a U.S. person or within the United States.  The prohibitions apply to contracts entered into or permits or licenses granted prior to the date of the EO.