By selecting UK flag, you have now set your site language to English. If you'd like to change your language preference again, simply click on one of the other flags.

Close

こちら Japan flag を選択して頂くと、言語設定が日本語に切り替わります。設定変更後は以下の機能が利用可能です。

  • 日本語版ウェブサイトへのクイックアクセスが可能となり、日本語の刊行物をご覧頂けます。

  • 日本語版が閲覧可能な刊行物や記事については、日本語が優先表示されます。表示言語については Japan flag をご参照下さい。

閉じる 言語設定を切り替えたい場合には、国旗のマークをクリックして下さい。

By selecting Japan flag, you have now set your language to Japanese. This has several benefits, including:

  • Providing quick access to our Japan page, which collates all our Japanese content in one place.

  • Ensures that content is presented to you in Japanese first, if we have an article, publication or webpage available in Japanese. Look out for the Japan flag indicators across the site.

Close If you’d like to change your language preferences again, simply click on one of the other flags.

点击选择 China flag,可将网站语言设置为中文。这能帮助您:

  • 快速访问我们的中国区页面,该页面将有网站内容的中文汇总。

  • 在我们的文章、出版物或者网页有中文版本提供的情况下,确保首先向您展示的是中文版本的内容。您可关注站点上的 China flag 按键。

关闭 点击任意其他国旗,可切换您的语言偏好。

By selecting China flag, you have now set your language to Chinese. This has several benefits, including:

  • Providing quick access to our China page, which collates all our Chinese content in one place.

  • Ensures that content is presented to you in Chinese first, if we have an article, publication or webpage available in Chinese. Look out for the China flag indicators across the site.

Close If you’d like to change your language preferences again, simply click on one of the other flags.

North has merged with Standard Club to form NorthStandard.
Find out more about NorthStandard here or continue on this site to access information and resources.

United States Sanctions on Venezuela

Add
PDF

This Circular provides information on the recent designation by the Government of the United States of Venezuela’s Maritime Authority (Instituto Nacional de los Espacios Acuaticos – “INEA”).

INEA was designated under Executive Order 13850 for operating in the oil sector of Venezuela and providing assistance to Venezuela’s state-owned oil company, PdVSA.

The designation led to understandable confusion among shipowners who were exposed to the possibility that they would offend certain provisions of E.O. 13850 by utilizing or paying for services provided by INEA at Venezuela ports on voyages unrelated to the oil or other targeted sectors.

To address this side effect of INEA’s designation, OFAC has now issued General License 30A appended to this Circular for information.

Background

Prior to being designated to the SDN list, INEA was blocked as a “Government of Venezuela” entity under E.O. 13884. This meant that, absent U.S. Government authorisation, U.S. persons were prohibited from engaging in virtually any transaction that involves INEA, either directly or indirectly.  As such, U.S. persons (including U.S. banks) were prohibited from engaging in transactions involving INEA once E.O. 13884 was issued, absent the relevant authorisation.

General License 30 provided that authorisation for ordinary port expenses, e.g., tugs, port dues, etc., such that transactions involving INEA associated with ordinary port usage and expenses were permissible, provided the trade was not sanctionable. The designation of INEA to the SDN list created confusion as to whether the authorisation of GL 30 would still apply. GL 30 stated that it did not authorise activities or transactions prohibited by E.O. 13850, the authority under which INEA is now designated.  Since E.O. 13850 was excluded from the scope of GL 30’s authorisation and INEA is now a SDN under E.O. 13850, U.S. persons could not transact with INEA absent some other authorisation.

Non-U.S. persons do not face the same blocking restrictions as U.S. persons, but they will risk sanctions if it is determined they have provided “material assistance, goods or services” to a SDN designated under E.O. 13850.

Current situation as of 3 February 2021

The publication of GL 30A by OFAC clarifies the dilemma. GL 30A has addressed INEAs designation by authorising all transactions and activities prohibited by E.O. 13850 involving INEA (or any entity in which it owns 50% or more) that are ordinarily incident and necessary to operations or use of ports in Venezuela. There are exceptions to the authorisation, but these are the same exceptions that have been in GL 30 since it was first issued, e.g., no authorisation for transactions related to diluents or other activities prohibited by E.O. 13850.

While General Licenses  apply to U.S. persons and activities with a U.S. nexus, we have been informed that OFAC has confirmed previously that a non-U.S. person does not engage in sanctionable conduct if it engages in conduct that would be authorised by a General License if engaged in by a U.S. person. We are advised that, as a matter of policy, GL 30A will apply to non-U.S. persons by analogy.

Accordingly, the International Group has since obtained guidance from experienced U.S. lawyers who have considered the relevant U.S. legal provisions in the round and have been advised that non-U.S. persons are unlikely to be exposed to sanctions under EO 13850 or EO13884 for using ordinary port services provided by INEA in Venezuela and paying ordinary port expenses to or for INEA, provided such is in connection with non-sanctionable trade.

Payment to INEA in non-U.S. Dollar transactions

The authorisation provided in GL 30A applies also to U.S. banks processing payments associated with ordinary port services provided by INEA. However, despite the publication of GL 30A, U.S. and non-U.S. banks may apply stricter internal protocols which could result in delayed payments to INEA if they are made in U.S. dollars, and while GL 30A should provide some comfort to banks, the Club cannot provide guarantees to Members that banks will not reject or delay such payment. Members seeking to make payment to INEA other than in U.S. dollars should consult their bank or local agents to see whether such transactions will be able to proceed.

The Club will publish further guidance as and when it becomes necessary to do so.

Thanks to Gina Venezia at Freehill Hogan & Mahar’s New York office for providing guidance on these matters.

All clubs in the International Group have issued a similarly worded common Circular.

MARK CHURCH
DIRECTOR (FD&D) AND HEAD OF SUSTAINABILITY
The North of England P&I Association Limited / North of England P&I DAC

CIRCULAR REF: 2021/004



Welcome to

We've merged with Standard Club to form NorthStandard, this means a new name and look for us, and even better service, support, and cover for you.

You can find out more about NorthStandard on our new website here. As part of the NorthStandard Group, please continue to use nepia.com for your industry news, publications and expertise as well as club rules and contacts.