- Asian gypsy moth notice issued February 2017 jointly by the Canadian Food Inspection Agency (CFIA) and the United States Department of Agriculture (USDA)
- Special Procedures for Ships Arriving from Areas with Asian Gypsy Moth issued 1 December 2016 by the USDA
BIMCO recommends that members recheck USDA-APHIS AGM webpage in case of any amendments.
Asian Gypsy Moth
Asian gypsy moth (AGM) is a serious pest that can be carried on ships and cargo. AGM populations are prevalent in some seaport areas in Far East Russia, Japan, Korea, and Northern China. If introduced, AGM would have significant negative impacts on North American forestry and agriculture, the natural environment, the commerce that relies on those plant resources, and market access.
Vessels must arrive in North American ports free of AGM and with required pre-departure certification. It is vital that the maritime industry and authorities in the United States (U.S.) and Canada collaborate on measures to minimize the risk of AGM incursion. Although the plant health and agricultural agencies of the U.S. and Canada are independent and have differences in their legislation, AGM risk mitigation and exclusion efforts are a joint effort and a high priority.
When vessels arrive without the required AGM certification, or when AGM is detected, significant delays in cargo loading or discharging activities as well as in routine clearance can occur, resulting in loss of revenue to the shipping line and associated parties.
The shipping industry is now more aware of necessary quarantine compliance for AGM. This has been vital to maintaining shipping schedules. Both countries are committed to working with industry partners on measures to reduce AGM risk at origin.
For vessels that have called on areas regulated for AGM during the specified periods, as outlined in Table 1, the following measures are required:
- Vessels must be inspected and must obtain pre-departure certification from a recognized certification body. A copy of the certificate, stating that the vessel is free of AGM life stages, must be forwarded to their U.S or Canadian agents. The certificate must be issued from at least the last port of call in a regulated area that was visited during the specific risk period.
- Vessels must arrive in North American ports free from AGM. To avoid facing inspection delays, re-routing and other potential impacts associated with mitigating the risk of entry of AGM to North America, shipping lines should perform intensive vessel self-inspections to look for, remove (scrape off) and properly dispose of or destroy all egg masses and other life stages of AGM prior to entering U.S. and Canadian ports.
- Vessels must provide two year port of call data, at least 96 hours prior to arrival in a North American port, to the Canadian or U.S. agent. The agent is to ensure that this information is provided to U.S. and Canadian officials.
Table 1. Regulated Areas and Specified Risk Periods
||Port or Prefecture
|Russian Far East
||Nakhodka, Ol'ga, Plastun, Pos'yet, Russkiy Island, Slavyanka, Vanino, Vladivostok, Vostochny, Zarubino, Kozmino
||1 July to 30 September
|People's Republic of China
||All ports in northern China, including all ports north 31o15'
||1 June to 30 September
|Republic of Korea
||1 June to 30 September
|Japan – Northern
||Hokkaido, Aomori, Iwate, Miyagi, Fukushima
||1 July to 30 September
||Akita, Yamagata, Niigata, Toyama, Ishikawa
||25 June to 15 September
|Japan - Eastern
||Fukui, Ibaraki, Chiba, Tokyo, Kanagawa, Shizuoka, Aichi, Mie
||20 June to 20 August
|Japan - Southern
||Wakayama, Osaka, Kyoto, Hyogo, Tottori, Shimane, Okayama, Hiroshima, Yamaguchi, Kagawa, Tokushima, Ehime, Kochi, Fukuoka, Oita, Saga, Nagasaki, Miyazaki, Kumamoto, Kagoshima
||1 June to 10 August
|Japan - Far Southern
||25 May to 30 June
In addition, vessels are reminded to ensure they are in good repair and decks are clear of debris and unnecessary obstacles to allow for thorough inspection both in AGM regulated areas and upon arrival in North America. While in regulated ports during moth flight periods and where port operations and safety allow, reducing lighting and keeping exterior doors and curtains closed may reduce the number of moths being attracted to the vessel. Requesting inspection and certification services as far in advance as possible and providing two-year port of call history at the time of that request allows the inspection and certification body to better plan for delivery of the service in a timely manner.
Upon arrival in North America, there have been detections on vessels that obtained predeparture certification. If certification is issued many days prior to ship departure from an area regulated for AGM, re-infestation can occur. Therefore, it is important that inspection and certification be conducted as close to time of departure as feasible during flight periods.
It is the responsibility of the shipping lines to meet all requirements for entry to the U.S. and Canada, including freedom from AGM and other pest concerns. We strongly urge maritime interests to take all possible precautions.
Please be advised that, although the U.S. and Canada are in full agreement on the requirement for AGM pre-departure certification and vessels arriving free from all AGM life forms (egg masses, pupae, adults), due to sovereign regulations and policies, there are differences in portof-entry processes between the two countries. Please contact local inspection authorities in the port of entry if you have any questions regarding AGM import requirements or clearance procedures."
Special Procedures for Ships Arriving from Areas with Asian Gypsy Moth (AGM)
This guidance provides information for ships arriving in the continental United States after being in areas with a high risk for AGM (Lymantria dispar) and other Lymantrid species infestation. It identifies the policy, obligations of shippers, and what to expect upon arrival at a United States port.
The Plant Protection Act grants the authority to prevent entry of high-risk vessels and to order infested ships to leave U.S. waters. [Title IV-Plant Protection Act, 7 U.S.C. 7701, Subtitle A, Section 411 (a)]. PPQ requires ships to obtain a certification that they are free from AGM prior to departure from the AGM high-risk area during PPQ-designated high-risk periods and if a pest is found, U.S. Department of Homeland Security’s Customs and Border Protection (CBP) has the authority to order a ship to leave U.S. waters to resolve the situation.
Ships without certification will receive an AGM inspection at all U.S. ports on each voyage when itinerary suggests an AGM risk, and may face significant delays. Additionally, if AGM is detected on a ship, that ship may not be allowed entry into the United States, or may not be allowed to load or unload cargo.
You are responsible for the following:
You (ship’s agent) must obtain a certificate documenting that the ship was inspected and found free of AGM. The certificate is mandatory if the vessel called on a port in a high-risk area listed in Table 1 during PPQ-designated high-risk periods over the last 24 months. Table 2 lists approved certifiers in the AGM high-risk area. You must allow CBP to conduct AGM inspections of the vessel, if CBP determines it is necessary. You must comply with the CBP officer’s instructions to mitigate risk of the introduction of AGM into the United States.
The female adult AGM lays eggs primarily during July through September in Far East Russia and northern Japan; from June through August in central and southern Japan; and from June through mid-September in South Korea and northern China (including all ports north of 31° 15' N latitude; north of Shanghai). Attracted by the lights on ships, the females may lay eggs on the superstructure and elsewhere.
Refer to Table 1 to determine times when a certificate is needed from AGM regulated countries.
Table 1 Regulated Areas and Specified Risk Periods
||Port or Prefecture
|Russian Far East
||Kozmino, Nakhodka, Ol’ga, Plastun, Pos’yet, Russkiy Island, Slavyanka, Vanino, Vladivostok, Vostochny, Zarubino
||1 July to 30 September
|People's Republic of China
||All ports in northern China, including all ports north 31o15'
||1 June to 30 September
|Republic of Korea
||1 June to 30 September
|Japan – Northern
||Aomori, Fukushima, Hokkaido, Iwate, Miyagi
||1 July to 30 September
||Akita, Ishikawa, Niigata, Toyama, Yamagata
|25 June to 15 September
|Japan - Eastern
||Aichi, Chiba, Fukui, Ibaraki, Kanagawa, Mie, Shizuoka, Tokyo
||20 June to 20 August
|Japan - Southern
||Ehime, Fukuoka, Hiroshima, Hyogo, Kagawa, Kagoshima, Kochi, Kumamoto, Kyoto, Miyazaki, Nagasaki, Oita, Okayama, Osaka, Saga, Shimane, Tokushima, Tottori, Wakayama, Yamaguchi
|1 June to 10 August
|Japan - Far Southern
||25 May to 30 June
Table 2 Approved Certifiers in AGM High-risk Area
| Region of Port
| Far East Russian ports
||Federal Service for Veterinary and Phytosanitary Surveillance of the Russian Federation
| South Korea
||International Plant Quarantine Accreditation Board (IPAB)
||China Certification and Inspection Group, LTD
- All Nippon Checkers Corporation (ANCC)
- Hokkaido Bouekikunjyo Co., LTD (HBKC)
- Hokuriku Port Service Co., Ltd. (HPS)
- Intertek Testing Services (Australia) Pty Limited (Pty Ltd)
- Japan Cargo Tally Corporation (JCTC)
- Japan Export Vehicle Inspection Center Co., Ltd. (JEVIC)
- Japan Grain Inspection Association (JGIA)
- Kanto Fumigation Co., Ltd (KFCO)
- Keiyochiku Plant Quarantine Association (KPQA)
- Kobe Plant Quarantine Association (KOBEPQA)
- Kyoritsu Sanitary Co., Ltd. (KRS)
- Muroran & Tomakomai Plant Quarantine Association (MTPQA)
- NAVREX & Corporation (NRX)
- Nikkun Co., Ltd (NCL)
- Nippon Kaiji Kentei Kyokai (NKKK)
- Okayama-Ken Plant Quarantine Association (OKYPQA)
- Osaka Plant Quarantine Association (OPQA)
- Osaka Timber Quarantine Association (OSKTQA)
- Shin Nihon Kentei Kyokai (SNKK)
- Techno Kasei Co., Ltd. (TKL)
- Tokai Plant Quarantine Association (TOKAIPQA)
- Tokyo Plant Quarantine Association (TPQA)
- Yokohama Plant Protection Association (YPPA)
Vessels are required to provide a mandatory advanced notification of arrival. Incoming vessels must inform port CBP officials of intent to arrive at least 96 hours in advance of entry into U.S. waters.
What to Expect
CBP will determine which ships should be boarded on arrival for AGM inspection; which vessels require normal, non-AGM boarding procedures; and which ships should be excluded entry.
Vessels can expect to receive the following enforcement monitoring actions:
- Non-certified vessels: will receive an AGM inspection at all U.S. ports on each voyage when itinerary suggests AGM risk
- Certified vessels: certificates along with additional research are to be used for risk assessment to determine need for inspection
- If AGM is suspected on a vessel, re-inspections at subsequent ports will occur
- If AGM is detected, and/or confirmed, vessels are subject to receive removal orders and be removed from port
A vessel requesting to arrive in the United States, and having visited an AGM high-risk area in the previous or current season, during AGM high-risk periods, and having been issued a predeparture AGM inspection certificate from an approved entity in Russia, China, South Korea or Japan.
A vessel requesting arrival in the United States that did not receive a predeparture AGM inspection during the most recent voyage to an AGM highrisk area, and does not have an AGM inspection certificate having visited an AGM high-risk area in the most recent voyage, whether this season or dating back to the previous season’s high-risk flight period.
Risk factors considered by CBP
- Vessel called on high-risk ports during designated AGM high-risk periods during the current or previous year. APHIS uses a 24-month history to help assess likelihood of egg viability.
- Reports or observations that indicate AGM may be present
- Not receiving a predeparture AGM inspection during the most recent voyage to a high-risk area
- Not having an inspection certificate after being in a high-risk area on the most recent voyage.
Ships entering Guam, Hawaii, Puerto Rico and the U.S. Virgin Islands will not be excluded, but may be inspected for AGM if the ship’s schedule includes subsequent continental U.S. ports of call.
If CBP determines that an AGM Inspection is needed, the officer will request to board the vessel. The officer will search for egg masses, larvae, pupae, or adult moths. This is a visual inspection that includes the whole ship. Officers will look:
- In sheltered locations
- In crevices or cavities
- Under tarps
- Behind walls and doors
- Around light fixtures
- Underneath the hold rims
- And anywhere else that AGM might lay eggs
See Figure 1 for a photograph of AGM egg masses aboard a ship. The egg masses appear as brown fuzz on the blue nylon rope. Figure 2 illustrates AGM eggs found between two bays on a support beam near a cargo hold opening.
Figure 1 AGM Egg Masses on Blue Nylon Rope
Figure 2 AGM Eggs Found Between Two Bays on a Support Beam Near a Cargo Hold Opening
If the officer identifies eggs, larvae, pupae, or adult moths the suspects will be collected and the area treated. The suspect AGM will be sent for identification. The officer will determine the appropriate action based on the identification and the level of infestation.
If suspect AGM are found, CBP will notify the Captain that a serious plant pest has been detected and the vessel may be re-boarded if AGM is confirmed. If the identifier confirms the presence of AGM, the vessel may be instructed to leave U.S. waters for decontamination prior to re-entering or beginning operations at any U.S. port. The officer will determine if the ship must leave U.S. waters to be decontaminated, based on the level of infestation and the ability to mitigate the risk of introduction of AGM at the port.
Upon conclusion to remove a vessel from U.S. territorial waters, PPQ Form 523, Emergency Action Notification will be issued. Any additional CBP forms will be issued as required by CBP policies and procedures. The Captain will be asked to prepare for and execute an immediate departure. The notification will instruct the ship’s agent to immediately call out necessary tugs, linesmen, and pilots for the ship’s departure. The only actions allowed are those that make the ship seaworthy, such as bunkering.
Ships may request reentry to a U.S. port of entry when they give CBP assurances that all egg masses are removed or disposed of properly. Figure 2 AGM Eggs Found Between Two Bays on a Support Beam Near a Cargo Hold Opening
During re-inspection, any subsequent suspect AGM found will result in additional pest prevention action. These actions will result in costly delays and further detection of potential AGM presence may lead to denying entry into the United States.
Returning to Port for Re-inspection
CBP will instruct the vessel on a time and place where re-inspection will occur. This may be to a designated remote location or instream. Further detection of viable suspect AGM life stages will require additional action resulting in continued costly delays and intensive pest control actions.
Upon re-inspection, if additional viable suspect AGM life stages are detected, the vessel will be required to employ a pest control company capable of handling large commercial assignments. The commercial company shall fully inspect and certify freedom from all AGM life forms. Under normal circumstances this action should take place outside of U.S. territorial waters. If safeguarding, weather and/or safety must be considered, remedial measures must be deployed to minimize potential pest risks.
AGM, Lymantria dispar, and other Lymantrid species from high-risk areas including Far East Russian, Chinese, South Korean, and Japanese ports where AGM populations are at high densities may infest ships and be transported to the United States. Inspection and exclusion of infested ships will prevent the spread of AGM.
The AGM displays significant behavioral differences compared to the European gypsy moth (EGM). The female AGM is an active flier that is attracted to lights, and capable of flying up to 25 miles. The AGM larvae have a broader host range and feed on larch and other conifers as well as on alder and willow. Oaks and other hardwood species are also acceptable hosts. Female adults die after laying eggs.
The term "United States" includes the territories and possessions of the United States and the customs waters of the United States (as defined in section 401 of the Tariff Act of 1930 (19 U.S.C. 1401)). i.e. Guam, Puerto Rico or any other area under the jurisdiction or authority of the United States, including the Trust Territory of the Pacific Islands.
The Office of Foreign Assets Control (OFAC) of the US Department of the Treasury administers and enforces economic and trade sanctions against targeted countries. OFAC is empowered to impose controls on transactions and freeze foreign assets under US jurisdiction. Several of the sanctions are based on United Nations Security Council Resolution, whilst others are unilaterally imposed by the United States.
It is important to note that US sanctions programmes vary considerably and what is prohibited with regard to one country may be permitted or licensable with regard to another.
All U.S. persons must comply with OFAC regulations, including all U.S. citizens and permanent resident aliens regardless of where they are located, all persons and entities within the United States, all U.S. incorporated entities and their foreign branches. In the cases of certain programs, such as those regarding Cuba, Iran and North Korea, all foreign subsidiaries owned or controlled by U.S. companies also must comply. Certain programs also require foreign persons in possession of U.S. origin goods to comply.
Specially Designated Nationals (SDNs)
US sanctions programmes go far beyond the borders of target countries. The US Government has identified and listed thousands of front organisations and individuals known as "Specially Designated Nationals," or SDNs, to further the effectiveness of the sanctions regimes. SDNs are individuals and entities located anywhere in the world that are owned or controlled by, or acting for or on behalf of, the Government of a sanctioned country, as well as designated international narcotics traffickers and terrorists targeted by the United States Government. The list also includes the names of vessels which have been determined to be owned or controlled by the targeted countries.
These vessels, companies, individuals, and banks may not appear to be related to the sanctions targets they actually represent. Many of these SDNs have innocuous names and are located in countries with which the United States enjoys harmonious trade relations, which is why it is important to carefully screen all parties involved in trade transactions using OFAC’s SDN list. All property and interests in property of SDNs that come into the possession of a U.S. corporation will be blocked.
Penalties for sanction violations
Depending on the program, criminal penalties can include fines ranging from $50,000 to $10,000,000 and imprisonment ranging from 10 to 30 years for willful violations. Depending on the program, civil penalties range from $250,000 or twice the amount of each underlying transaction to $1,075,000 for each violation. Vessels involved in trade contrary to the sanctions regulations may be subject to seizure and forfeiture.
OFAC has the authority to authorise transactions which would otherwise be prohibited under specific sanctions provisions. OFAC’s Licensing Division reviews all license applications on a first-in, first-out, case-by-case basis and issues or denies licenses based on US foreign policy and national security goals. Filing a complete application will expedite processing, but there are no guarantees that a license will be issued just because one is requested. The OFAC Licensing Division can be reached at +1 202 622 2480 for further licensing information, applications, or about the status of a pending application.
Sanctions imposed by the USA
On 16 January 2015 the amended Cuban Assets Control Regulations (31 C.F.R. § 515) came into effect upon publication in the Federal Register implementing policy changes as announced by the President on 17 December 2014. One of the amendments is to section 515.550 Certain vessel transactions authorized which broadened the definition of vessels permitted to engage in trade with Cuba, subject to specific licensing requirements.
"Revise § 515.550 to read as follows:
§ 515.550 Certain vessel transactions authorized.
Unless a vessel is otherwise engaging or has otherwise engaged in transactions that would prohibit entry pursuant to § 515.207, § 515.207 shall not apply to a vessel that is:
(a) Engaging or has engaged in trade with Cuba authorized pursuant to § 515.533 or § 515.559;
(b) Engaging or has engaged in trade with Cuba that is exempt from the prohibitions of this part (see § 515.206);
(c) Engaging or has engaged in the exportation or re-exportation to Cuba from a third country of agricultural commodities, medicine, or medical devices that would be designated as EAR99 under the Export Administration Regulations (15 CFR part 730 et seq.), if they were located in the United States; or
(d) A foreign vessel that has entered a port or place in Cuba while carrying students, faculty, and staff that are authorized to travel to Cuba pursuant to § 515.565(a).Show citation box
Note to § 515.550(d): This general license does not authorize vessels to transport persons between the United States and Cuba. See § 515.572(c)."
Cuba is listed as a "non-entrant country". Hence, Cuban vessels are not permitted to enter US ports, internal waters, or territorial seas except when engaged in innocent passage, under the conditions of force majeure, or distress situations involving a medical emergency.
Non Cuban registered, owned, operated or chartered vessels are governed in part by the "Cuban Democracy Act 1992" (CDA) and the "Cuban Liberty and Democratic Solidarity (LIBERTAD) Act of 1996"
The following excerpt is taken from an OFAC Sanctions Brochure on Cuba.
"Exporting to Cuba
Except for publications, other informational materials (such as CDs and certain artwork), certain donated food, certain licensed legal and telecommunications services, and certain goods licensed for export or re-export by the U.S. Department of Commerce (such as medicine and medical devices, food, agricultural commodities, and gift parcels), no products, technology, or services may be exported from the United States to Cuba, either directly or through third countries, such as Canada or Mexico, absent a specific license from OFAC. This prohibition includes dealing in or assisting with the sale of goods or commodities to or from Cuba, even if done entirely offshore. Such brokering is considered to be dealing in property in which Cuba has an interest and is therefore prohibited. Provision of consulting services is also prohibited. Thus, no U.S. citizen or permanent resident alien, wherever located, and no foreign subsidiary or branch of a U.S. organization, may export products, technology, or services to Cuba or to any Cuban national, wherever they may be located, or broker the sale of goods or commodities to or from Cuba or any Cuban national.
Pursuant to section 515.533 of the Regulations(*), transactions ordinarily incident to the exportation of items from the United States to Cuba or the reexportation of 100% U.S.-origin items from a third country to Cuba are authorized by general license provided the export is licensed or otherwise authorized by the Department of Commerce. Pursuant to provisions of the Cuban Democracy Act of 1992 (the “CDA”) and the Trade Sanctions Reform and Export Enhancement Act of 2000, the Commerce Department maintains a favourable license policy with respect to the sale and export or re-export of medicine and medical devices, food, and agricultural commodities to Cuba. Those interested in engaging in such exports or re-exports must first obtain authorization from the Commerce Department’s Bureau of Industry and Security. All licensed sales must be financed by cash-in-advance or by third-country banks that are not persons subject to U.S. jurisdiction or owned or controlled by Cuba or Cuban nationals. Foreign subsidiaries of U.S. banks, however, are authorized to directly finance licensed sales of agricultural products. All U.S. banks may advise or confirm any of the transactions authorized above. Section 1705(b) of the CDA provides for donations of food to independent non-governmental organizations or individuals in Cuba. Shipments of food may be donated to non-governmental organizations from the U.S. or from third countries without a license from the U.S. government.
In the mid-1970s, section 515.559 was added to the Regulations to publicize OFAC's policy of licensing foreign subsidiaries of U.S. firms to conduct trade in commodities with Cuba so long as several specific criteria were met. Section 1706(a) of the CDA, however, prohibits the issuance of licenses that would have been issued pursuant to section 515.559, except where a contract was entered into prior to enactment of the CDA or where the exports at issue are medicines or medical supplies or certain telecommunications equipment. Accordingly, OFAC does not license foreign subsidiaries of U.S. firms to conduct trade in commodities with Cuba except in limited circumstances.
Pursuant to the CDA and section 515.207 of the Regulations, no vessel carrying goods or passengers to or from Cuba or carrying goods in which Cuba or a Cuban national has any interest may enter a U.S. port absent authorization from OFAC. The prohibition applies to vessels even if they enter only to take on fuel and supplies (bunker), whether from U.S. fuel providers within the port limits or at offshore points, as well as vessels discharging or loading merchandise offshore, by lighter or otherwise. In addition, vessels that enter a port or place in Cuba to engage in the trade of goods or services are prohibited from entering a U.S. port for the purpose of loading or unloading any freight for 180 days. Pursuant to section 515.550 of the Regulations, a general license authorizes entry into U.S. ports notwithstanding these two vessel prohibitions provided the vessel is engaging solely in trade with Cuba that is authorized by license or exempt from the Regulations (e.g., vessels carrying authorized exports of agricultural products or donations of food to nongovernmental organizations or individuals)."
(*) The Cuban Assets Control Regulations, 31 CFR Part 515"
The " Cuban Liberty and Democratic Solidarity (LIBERTAD) Act of 1996" (also known as the Helms-Burton Act) is aimed at discouraging foreign investment in Cuba in former U.S. property nationalised by the Cuban government in 1959. The legislation has been drafted in such broad and ambiguous terms that it is very difficult to interpret the effects of this Act on international shipping.
However, Title IV provides for the exclusion from the United States, either through denial of a visa or exclusion at the port of entry, of any foreign national who the Secretary of State determines is a person who, "traffics" in "confiscated" property in Cuba, a claim to which is owned by a US national. Title IV requires the exclusion of corporate officers, principals or controlling shareholders of companies that engage in such trafficking, as well as the spouse, minor child or agent of persons excluded.
Title IV defines "traffics" to include: transfers, distributes, dispenses, brokers or otherwise disposes of confiscated property; purchases, receives, obtains control of, or otherwise acquires confiscated property; or improves or invests in (other than for routine maintenance) or begins to manage, lease, possess, use or hold an interest in confiscated property. The term "traffics" also covers entry into a commercial arrangement using or otherwise benefiting form confiscated property, as well as causing, directing, participating in or profiting from trafficking by or through another person or entity.
Purchasing a vessel which has previously been under Cuban ownership.
What, if any, implications are there for the ship with respect to trading at US ports ?
The US Department of the Treasury's Office of Foreign Assets Control (OFAC) informed BIMCO that vessels which have been Cuban-owned are entered on OFAC's list of Cuban Specially Designated Nationals (SDN's) and Cuban entities and vessels. Having purchased such a vessel an owner must apply to OFAC to have the ship removed from the list, otherwise she will be blocked upon entering US waters.
OFAC will remove ships from their list once they are provided with acceptable evidence that the sale or other transfer of the vessel has completely terminated any interest in the vessel of Cuba or a Cuban national. However, OFAC advised that the 180 day prohibition put on vessels which have called at Cuban ports is attached to the vessel, regardless of whether or not the ship changes ownership.
Frequently Asked Questions on Changes to the Cuba Sanctions Program Updated 8 November 2017. Section VI, Items 94-98 covers the 180 day rule.
Trading restrictions are administered and enforced by the OFAC. On 13 September 2010, OFAC removed the Iraqi Sanctions Regulations, 31 C.F.R. Part 575, from 31 C.F.R. chapter V, and added the Iraq Stabilization and Insurgency Sanctions Regulations ("ISISR") as new part 576 to 31 C.F.R. chapter V. The ISISR implement Executive Order 13303 of 22 May 2003, Executive Order 13315 of 28 August 2003, Executive Order 13350 of 29 July 2004, Executive Order 13364 of 29 November 2004, and Executive Order 13438 of 17 July 2007.
OFAC Iraq sanctions program
Iran is listed as a "non-entrant country". Hence, Iranian vessels are not permitted to enter US ports, internal waters, or territorial seas except when engaged in innocent passage, under the conditions of force majeure, or distress situations involving a medical emergency.
US persons and companies (including foreign subsidiaries) are prohibited from transacting business with Iran, either directly or indirectly, with certain exceptions.
On 5 August 1996, the US President signed the "Iran and Libya Sanctions Act of 1996" which unilaterally imposes secondary sanctions against non US nationals/companies investing USD 40,000,000 or more in Iran during a 12 month period.
On 1 July 2010, the US President signed the "Comprehensive Iran Sanctions, Accountability, and Divestment Act of 2010" (CISADA) and Executive Order No. 13590 issued 21 November 2011 which enhanced economic sanctions relating to Irans refined petroleum products industry. Additional measures were introduced under Executive Order No. 13590 issued 21 November 2011 and Executive Order issued 31 July 2012.
On 10 August 2012, the US President signed into law the Iran Threat Reduction and Syria Human Rights Act of 2012. This amends the Iran Sanctions Act of 1996 and Comprehensive Iran Sanctions, Accountability, and Divestment Act of 2010 (CISADA) by adding additional sanctions.
On 10 October 2012, the US President signed a new Executive Order “Authorizing the Implementation of Certain Sanctions Set Forth in the Iran Threat Reduction and Syria Human Rights Act of 2012 and Additional Sanctions with Respect to Iran” which prohibits foreign subsidiaries of U.S. persons from knowingly violating the Iranian Transactions Regulations.
On 2 January 2013, the US President signed into law the "National Defense Authorization Act for Fiscal Year 2013" which includes the "Iran Freedom and Counter-Proliferation Act of 2012" (IFCPA) under Sections 1241 to 1255, further expanding US sanctions against Iran. Whilst a few of the new sanctions took immediate effect, most will become effective 180 days after the date of enactment (i.e. 1 July 2013).
On 24 November 2013, the P5+1 (the United States, United Kingdom, Germany, France, Russia, and China) reached an initial understanding with Iran, outlined in a Joint Plan of Action (JPOA). In return for Iran’s commitment to place meaningful limits on its nuclear program, the P5+1 committed to provide Iran with limited, targeted, and reversible sanctions relief for a six-month period.
On 12 January 2014, the P5+1 and Iran arrived at technical understandings for the Joint Plan of Action (JPOA), which will be implemented beginning on 20 January 2014 and ending 20 July 2014 (JPOA Period). The relief provided in the JPOA only pertained to conduct and transactions fully completed during the JPOA Period, and, with limited exceptions, involved only certain sanctions on non-U.S. persons not otherwise subject the Iranian Transactions and Sanctions Regulations. The exemption were extended several times.
On 16 January 2016 the Joint Comprehensive Plan of Action (JCPOA) was implemented and the United States lifted its nuclear related sanction as described in the JCPOA. In connection with the lifting OFAC issued the following:
US withdrawal from the Joint Comprehensive Plan of Action (JCPOA)
On 8 May 2018 the President announced the decision to cease the US participation in the JCPOA. The US withdrawal from the JCPOA, and its decision to reactivate the nuclear related laws that were waived in order to implement the JCPOA, will have significant complications for maritime trade with Iran and companies engaged in this.
On 6 August 2018 the President issued Executive Order 13846 which re-imposes secondary sanctions that had been suspended pursuant to the JCPOA. A previously established wind-down period will remain in effect until 4 November 2018 for some categories of transactions which include those relating to shipping, shipbuilding and port sectors of Iran.
It would appear that these sanctions will be relevant not only to entities directly dealing with public and private sector entities in Iran but also third parties who deal with both US and Iranian entities.
Companies based in EU would, however, also need to consider the effects of the EU Blocking Regulation. The EU's updated Blocking Statute which entered into force on 7 August 2018 is intended to protect EU persons and entities from the effects of US secondary sanctions.
In effect the companies must comply with either EU law or the US imposed sanctions on Iran making it a very difficult and highly complex situation. It is, however, possible for companies to apply for an exemption from compliance with the EU blocking regulation.
Despite the blocking regulation, it seems EU operators may still face the ultimate US penalties, that is, a blocking of the operator’s property in the US and loss of access to the US financial system. It consequently remains to be seen to which extent the Blocking Statute will counteract the US secondary sanctions.
While there are many uncertainties related to the sanctions, it is clear that members already conducting, or considering to conduct, business involving Iranian entities or interests must seek input from legal professionals with expertise in the US sanctions programme. If members are based in the EU the input is also needed from specialists in the EU Blocking Regulation.
The P&I Clubs have issued circulars particularly dealing with this topic and more information can also be found on OFAC’s website.
Aside from the reactivated nuclear related laws, the main sanction items of interest are:
Specially Designated Nationals List (SDN List)
The sanctions involve designated entities, referred to as Specially Designated Nationals or SDNs, which list companies and individuals located not just in Iran, but anywhere in the world. The list also includes the names of vessels which have been determined to be owned or controlled by designated entities and numerous banks/financial institutions involved with designated entities.
As companies, individuals, vessels and financial institutions may not appear to be related to the Iranian sanctions, having innocuous names and may be located in countries with which one enjoys harmonious trade relations, it is vitally important to carefully screen all parties involved (i.e. shippers, receivers, charterers, owners, brokers, banks, vessel, port/terminal operator, etc...) to ensure that no designated entity is directly or indirectly involved.
Arms and strategic goods and services embargo
Ban on Arms exports to Iran.
Restrictions on exports to Iran of "Duel Use Items".
Iran Threat Reduction and Syria Human Rights Act of 2012, Sec. 203 will apply sanctions on a person that on or after the date of the enactment of theAct, exported, transferred, permitted or otherwise facilitated the transshipment of, any goods, services, technology, or other items to any other person; and knew or should have known that this would contribute materially to the ability of Iran to acquire or develop chemical, biological, or nuclear weapons or related technologies; or acquire or develop destabilizing numbers and types of advanced conventional weapons.
Iran Threat Reduction and Syria Human Rights Act of 2012, Sec. 211 provides that if the President determines that a person, on or after the date of the enactment of this Act, knowingly sells, leases, or provides a vessel or provides insurance or reinsurance or any other shipping service for the transportation to or from Iran of goods that could materially contribute to the activities of the Government of Iran with respect to the proliferation of weapons of mass destruction or support for acts of international terrorism, the President shall block and prohibit all transactions in all property and interests in property ... if such property and interests in property are in the United States, come within the United States, or are or come within the possession or control of a United States person.
Iron, steel, aluminum, and copper
On 8 May 2019, the President of the United States issued a new Executive Order (E.O.), imposing sanctions with respect to the iron, steel, aluminum, and copper sectors of Iran. The relevant FAQ can be viewed here.
CISADA includes mandatory banking sanctions targeted at foreign banks that knowingly facilitate: Iranian WMD transactions; transactions related to Iran's support for terrorism; the activities of persons sanctioned under Iran related United Nations Security Council Resolutions; significant transactions with the IRGC (Iran's Revolutionary Guard) or its affiliates; or significant transactions with Iranian linked banks designated by the United States.
Freezing of Assets
Includes the freezing of US based property/assets of the Islamic Republic of Iran Shipping Lines (IRISL) and affiliated entities.
Travel ban on named persons
The Democratic People's Republic of Korea is listed as a "non-entrant country". Hence, Democratic People's Republic of Korean vessels are not permitted to enter US ports, internal waters, or territorial seas except when engaged in innocent passage, under the conditions of force majeure, or distress situations involving a medical emergency.
OFAC regulations, authorised under the Trading with the Enemy Act, established economic sanctions against the Democratic People's Republic of Korea in 1950. They have since been modified on several occasions.
OFAC Democratic People's Republic of Korea sanctions program
The Department of the Treasury, along with the Departments of State and the U.S. Coast Guard, is issuing a sanctions advisory on North Korea.
Libya is listed as a "non-entrant country". Hence, Libyan vessels are not permitted to enter US ports, internal waters, or territorial seas except when engaged in innocent passage, under the conditions of force majeure, or distress situations involving a medical emergency.
On 25 February 2011 the President issued Executive Order 13566 freezing assets of certain entities / persons. This was expanded by Executive Order 13726 dated 19 April 2016.
OFAC Libya sanctions program
On 27 November 2018, the President signed an Executive Order Blocking Property of Certain Persons Contributing to the Situation in Nicaragua.
OFAC Nicaragua sanctions program
OFAC Somalia sanctions program
On January 13, 2017 EO 13761 lifted the US sanctions against Sudan for 6 months, with the potential for a revocation of those sanctions on July 12, 2017. After a further 6 months extension, the sanctions are now being revoked, effective October 12, 2017
The revocation applies to Sections 1 and 2 EO 13067 of November 3,1997 to all of EO 13412 of October 13, 2006. Sections 1 and 2 of EO 13067 blocked all property of Government of Sudan in the US and banned the importation of any goods or services from Sudan to the US as well as the exportation of any goods or services from the US to Sudan. In addition, US people were prohibited from facilitating or brokering the exportation of goods or services to Sudan from any location from financing certain projects in Sudan from extending loans or credit to the Government of Sudan or from transporting any cargo to or from Sudan. EO 13412 prohibited US people from engaging in all transactions relating to the petroleum or petrochemical industries in Sudan. All of these prohibitions have now been revoked and US people are free to engage in all transactions with Sudan.
Despite the revocation of sanctions against Sudan that country remains on the State Sponsors of Terrorism List (“SSI List”). As a result, under the Trade Sanctions Reform and Export Enhancement Act of 2000 the export and reexport to Sudan of certain agricultural commodities, medicine and medical devices still require an OFAC license. To address legislative requirement, OAFC has issued General License A which authorizes said shipments without the need to obtain specific licenses.
OFAC Sudan sanction program
Syria is listed as a "non-entrant country". Hence, Syrian vessels are not permitted to enter US ports, internal waters, or territorial seas except when engaged in innocent passage, under the conditions of force majeure, or distress situations involving a medical emergency.
On 11 May 2004 the President issued an Executive Order blocking assets of certain Syrian persons and prohibiting the export of certain US goods to Syria as of 12:01 eastern daylight time on 12 May 2004. Details available in the OFAC Sanctions Brochure.
In 10 August 2012 the President signed the Iran Threat Reduction and Syria Human Rights Act of 2012 [H.R.1905] which added additional measures relating to human rights in Syria.
Sanction include, but not limited to the following
- blocking the property and interests in property of the Government of Syria and that of Specially Designated Nationals (SDNs)
- prohibiting transactions or dealing with designated entities.
- prohibiting the export of certain US goods to Syria.
- new investment by US person
- prohibition of importation into the US of petroleum or petroleum products of Syrian origin
- any transaction or dealing by a U.S. person, wherever located, in or related to petroleum or petroleum products of Syrian origin
- any approval, financing, facilitation, or guarantee by a U.S. person, wherever located, of a transaction by a foreign person where the transaction by that foreign person would be prohibited if performed by a U.S. person or within the United States.
OFAC Syria sanctions program
On 6 March 2014 the US President signed an Executive Order 13660 blocking the property of certain persons contributing to the situation in Ukraine.
The Executive Order allows the United States to sanction any individual or entity that they determine as responsible for, or complicit in, actions or policies that undermine democratic processes or institutions in Ukraine or that threaten the peace, security, stability, sovereignty, or territorial integrity of Ukraine. It further allows the United States to sanction persons who are involved in the misappropriation of state assets of Ukraine or have asserted governmental authority over any part or region of Ukraine without the authorisation of the Government of Ukraine.
On 17 March 2014 the President signed a new Executive Order "Blocking Property of Additional Persons Contributing to the Situation In Ukraine". This new authority expands upon Executive Order 13660 by providing the ability to target officials of the Government of the Russian Federation, any individuals or entities that operate in the arms or related materiel sector in the Russian Federation, and any individual or entity that is owned or controlled by, or provides material or other support to any senior official of the Government of the Russian Federation or any person designated pursuant to this order.
On 20 March the President signed another Executive Order "Blocking Property of Additional Persons Contributing to the Situation In Ukraine" expanding upon the two previous Executive Orders.
On 8 May 2014 the Office of Foreign Assets Control issued the new Ukraine-Related Sanctions Regulations, 31 CFR part 589, to implement Executive Order 13660 of 6 March 2014 ("Blocking Property of Certain Persons Contributing to the Situation in Ukraine"), Executive Order 13661 of 17 March 2014 ("Blocking Property of Additional Persons Contributing to the Situation in Ukraine"), and Executive Order 13662 of 20 March 2014 ("Blocking Property of Additional Persons Contributing to the Situation in Ukraine"). These regulations were published as a final rule at 79 FR 26365, 8 May 2014. In keeping with its usual practice, OFAC published the regulations in abbreviated form at this time but intends to supplement this part 589 with a more comprehensive set of regulations, which may include additional interpretive and definitional guidance and additional general licenses and statements of licensing policy.
On 16 July 2016 OFAC introduced the Sectoral Sanctions Identifications List to identify persons operating in sectors of the Russian economy identified by the Secretary of the Treasury pursuant to Executive Order 13662. Directives found within the list describe prohibitions on dealings with the persons identified.
OFAC Ukraine/Russia related sanction program
On 8 March 2015 the US President signed Executive Order 13692 "Blocking Property and Suspending Entry of Certain Persons Contributing to the Situation in Venezuela". The sanctions list individuals and entities (Specially Designated Nationals or SDNs) which are subject to an asset freeze, travel restrictions and are generally prohibited from engaging in business with US individuals and entities.
On January 25, 2019, the President signed an Executive Order “Taking Additional Steps to Address the National Emergency with Respect to Venezuela” expanding the definition of the term “Government of Venezuela”.
Subsequently on 28 January 2019 OFAC designated Petróleos de Venezuela, S.A. (PdVSA) pursuant to Executive Order (E.O.) 13850 for operating in the oil sector of the Venezuelan economy, following a determination by Secretary of the Treasury, that persons operating in Venezuela’s oil sector are subject to sanctions pursuant to E.O. 13850. Please see here the relevant FAQ.
On 9 November 2012, the Office of Foreign Assets Control issued the new Yemen Sanctions Regulations, 31 CFR part 552, to implement Executive Order 13611 of 16 May 2012, “Blocking Property of Persons Threatening the Peace, Security, or Stability of Yemen.” These regulations were published as a final rule at 77 FR 67276 on 9 November 2012.
OFAC Yemen sanctions program
- Myanmar sanctions ended as of 7 October 2016
- Ivory Coast sanctions ended as of 14 September 2016.