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Another Market Opens: U.S. Revokes Sudanese Sanctions Program Though Important Limitations Remain in Place

Effective October 12, 2017, the Sudanese Sanctions Regulations (SSR) have been revoked in recognition of the Government of Sudan’s (GOS) sustained positive actions in stopping conflict and improving humanitarian access in Sudan.  This latest action makes permanent the general license issued in January 2017.  However, Sudan remains designated as a “State Sponsor of Terrorism” and accordingly, key restrictions remain.

As background, in January 2017 the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) issued a general license temporarily authorizing all transactions previously prohibited under the Sudanese Sanctions Regulations (SSR).  This includes exports and imports to/from Sudan as well as transactions with the Government of Sudan and Specially Designated Nationals (SDNs) who were designated pursuant to the SSR. The recent announcement removes the Executive Orders and Sudanese Sanctions Regulations, effectively making what was temporary authorized permanent.

OFAC continues to maintain targeted sanctions programs involving South Sudan and Darfur.   There are still certain Sudanese individuals and entities that will remain SDNs pursuant to these other sanctions programs and  U.S. persons will continue to be prohibited from doing business with SDNs.

Moreover, Sudan remains designated on the State Sponsors of Terrorism List and is therefore subject to export licensing requirements for most items subject to the U.S. Export Administration Regulations (EAR).   For any export or reexport of controlled (i.e. non-EAR99) hardware, software, or technology to Sudan, a license or applicable license exception (such as “CCD”) would be required.  Exports of EAR99 items generally do not require a license for Sudan, though you must continue to adhere to end-use and end-user controls laid out in the EAR.  This includes, for example, exports to denied end users or for prohibited military or proliferation end uses.

Finally, companies must continue to abide by all applicable anti-corruption and anti-money laundering laws.  Sudan remains subject to a heightened corruption risk and activities involving Government of Sudan officials should be carefully assessed and monitored.