Biden Administration Announces New Sanctions on Nord Stream
On February 23, President Biden announced new sanctions on Nord Stream 2 AG (Nord Stream), the company behind the Nord Stream 2 gas pipeline. In furtherance of this action, the US Department of Treasury, Office of Foreign Asset Control (OFAC) added Nord Stream and its CEO Matthias Warnig to its Specially Designated Nationals list (SDN List). US persons, including US financial institutions, are prohibited generally from engaging in any transactions with SDNs and are required to block (i.e., freeze) any property or interests in property belonging to SDNs.
In addition, OFAC issued General License 4, which authorizes transactions through March 2, 2022, if they are “ordinarily incident and necessary to the wind down of transactions” involving the Nord Stream and its subsidiaries.
These latest measures follow several sanctions implemented by the US government over the past couple days, including prohibitions on two Russian financial institutions, Russian sovereign debt, and Russian Oligarchs as well as an executive order (issued Monday) restricting investment, trade, and financing in Donetsk and Luhansk. The sanctioning of Nord Stream comes on the heels of Germany’s decision to halt certification of the pipeline earlier this week.
The Biden Administration continues to stress that further sanctions will be implemented on Russia if it expands its activities in Ukraine. We are continuing to monitor the situation and will update you as events unfold.
© Arnold & Porter Kaye Scholer LLP 2022 All Rights Reserved. This blog post is intended to be a general summary of the law and does not constitute legal advice. You should consult with counsel to determine applicable legal requirements in a specific fact situation.