What is the significance of OFAC’s designations of Rosneft Trading S.A. and TNK Trading International S.A.? Do the E.O. 13850 blocking sanctions on Rosneft Trading S.A. and TNK Trading International S.A. apply to their corporate parent and their affiliates?

OFAC's answer

On February 18, 2020, OFAC designated Rosneft Trading S.A. pursuant to [E.O. 13850](https://ofac.treasury.gov/media/5516/download?inline) for operating in the oil sector of the Venezuelan economy. Likewise, on March 12, 2020, OFAC designated TNK Trading International S.A. pursuant to E.O. 13850 for operating in the oil sector of the Venezuelan economy. General License 36A authorizes U.S. persons to engage in certain activities prohibited by E.O. 13850 necessary for the wind down of transactions involving Rosneft Trading S.A. or TNK Trading International S.A., or any entity in which Rosneft Trading S.A. or TNK Trading International S.A. owns, directly or indirectly, a 50 percent or greater interest, through 12:01 a.m. eastern daylight time, May 20, 2020. After the expiration of this authorization, unless exempt or authorized by OFAC, U.S. persons will be prohibited from engaging in transactions with Rosneft Trading S.A. or TNK Trading International S.A., or any entity in which Rosneft Trading, S.A. or TNK Trading International S.A. owns, directly or indirectly, a 50 percent or greater interest, and must block property or interests in property of Rosneft Trading S.A. and TNK Trading International S.A. that are in, or come within, the United States, or the possession or control of a U.S. person. As Rosneft Trading S.A. and TNK Trading International S.A. are also identified on the Sectoral Sanctions Identifications List (SSI List) pursuant to Directives 2 and 4 to [E.O. 13662](https://ofac.treasury.gov/media/5961/download?inline) under the Ukraine-/Russia-related sanctions program, those winding down transactions with Rosneft Trading S.A. or TNK Trading International S.A. should ensure that all activities comply with any applicable Directive 2 and 4 prohibitions, because General License 36A only authorizes certain activities necessary to the wind down of transactions prohibited by E.O. 13850. The E.O. 13850 blocking sanctions apply only to Rosneft Trading S.A. and TNK Trading International S.A., or any entity in which Rosneft Trading S.A. or TNK Trading International S.A. owns, directly or indirectly, a 50 percent or greater interest. Blocking sanctions do not apply to these entities’ ultimate parent, Rosneft Oil Company. Similarly, blocking sanctions do not apply to Rosneft Oil Company or other subsidiaries or affiliates, provided that such entities are not owned 50 percent or more in the aggregate by one or more blocked persons or otherwise explicitly designated or identified by OFAC. U.S. persons, therefore, are not prohibited under E.O. 13850 from dealing with Rosneft Oil Company, its non-blocked subsidiaries, or non-blocked affiliates to the extent the proposed dealings do not involve any blocked persons or any other activities prohibited pursuant to any OFAC sanctions authorities. As Rosneft Oil Company, Rosneft Trading S.A., and TNK Trading International S.A. have been listed on the SSI List since July 2014, July 2015, and March 2020 respectively, they are subject to Ukraine-/Russia-related Directives 2 and 4. U.S. persons should be mindful of the relevant Ukraine-/Russia-related prohibitions that would be applicable as a result of dealings with both Rosneft Oil Company, Rosneft Trading S.A., and TNK Trading International S.A. See, generally,FAQs [370-373](https://ofac.treasury.gov/faqs/370), [391-396](https://ofac.treasury.gov/faqs/391), [405-410](https://ofac.treasury.gov/faqs/405), [412-421](https://ofac.treasury.gov/faqs/412), and [536-538](https://ofac.treasury.gov/faqs/536) for prohibitions on U.S. persons dealing with entities listed on the SSI List. See alsoFAQs [398](https://ofac.treasury.gov/faqs/398) and [400](https://ofac.treasury.gov/faqs/400) for information regarding dealings with blocked persons representing non-blocked entities.

Related programs

Related FAQs

• #370What do the prohibitions in Directives 1 and 2 mean? Are they blocking actions?
• #391Can U.S. persons issue and deal in new depositary receipts that are based on the equity of an entity subject to sanctions under one of the Directives?
• #398Does OFAC consider entities over which one or more blocked persons exercise control, but of which they do not own 50 percent or more in the aggregate, to be blocked pursuant to OFAC’s 50 Percent Rule?
• #400As explained in FAQ 398, OFAC’s 50 Percent Rule does not apply if one or more individuals who are blocked persons (blocked individuals) control, but do not own 50 percent or more of, an entity. Can persons engage in negotiations, enter into contracts, or process transactions involving a blocked individual when that blocked individual is acting on behalf of the non-blocked entity that he or she controls (e.g., a blocked individual is an executive of a non-blocked entity and is signing a contract on behalf of the non-blocked entity)?
• #405Does the prohibition on “otherwise dealing in new debt” of longer than the applicable tenor specified in the relevant Directive of SSI entities, their property, or their interests in property prohibit dealing in debt with maturity that exceeds the applicable authorized tenor in which the SSI entity is not directly or indirectly the borrower?
• #412What do the prohibitions contained in Directive 4 mean? What is the scope of prohibited services?
• #536For purposes of subsection 2 of Directive 4, what does it mean for a project to be “initiated”?