The US treasury's Office of Foreign Assets Control (OFAC) on 2 December issued several new actions to increase sanctions pressure on the government of Belarus, including the imposition of restrictions on dealings in new issuances of Belarusian sovereign debt in both primary and secondary markets.

Letters of credit (L/Cs) are included in the definition of debt according to a 'frequently asked question' (FAQ) issued by OFAC alongside the new restrictions.

Other new actions include the designation of 35 additional persons and entities to the specially designated nationals and blocked persons list (SDN list), and an order giving US persons 120 days to wind down operations with two entities designated in the potash sector.

Debt definition

In FAQ 944, OFAC states that the term "debt" is defined as including "bonds, loans, extensions of credit, loan guarantees, L/Cs, drafts, bankers' acceptances, discount notes or bills, or commercial paper." This is consistent with the definition applied to debt in other OFAC sanctions programmes.

Other actions that may impact on L/C business include the designation of state-owned cargo carrier, JSC Transaviaexport Airlines and defence industry exporters CJSC Beltechexport, AGAT Electromechanical Plant and Kidma Tech.

Sanctions rationale

According to OFAC, it is imposing tougher sanctions on the government of Belarus for the "blatant disregard for international norms and the wellbeing of its own citizens" under the regime of Alexander Lukashenka, the first and current president of Belarus since the establishment of the office in 1994.

This latest action by OFAC mirrors those already taken the EU, Canada and the UK in response to what they say is the Lukashenka regime's programme to lure of migrants to travel to Belarus from where Belarusian officials direct and force migrants across the border to facilitate their passage into the EU. The regime does not allow them to return Belarus.

Details of OFAC's new actions to increase sanctions pressure on the government of Belarus can be accessed from here.

This article represents the views of the author and not necessarily those of the ICC or Coastline Solutions.