On July 25, 2017, the United States House adopted H.R. 3364, the “Countering America’s Adversaries Through Sanctions Act” (“CAATS”), a compromise measure incorporating both House and Senate sanctions proposals. The vote was 419-3. CAATS was approved by the Senate on July 27, 2017 (the vote was 98-2). It now awaits signature by President Trump (who in any event appears to lack sufficient support to uphold a veto).
Assuming it becomes law, CAATS will:
- codify all existing Russia sanctions and designations (meaning the Trump Administration cannot unilaterally lift them) and require congressional review for any subsequent changes in licensing policy;
- expand secondary sanctions against Russia, most notably by targeting any transaction by a non-U.S. person with a Russian SDN and Russian energy export pipelines, and reinvigorate existing but currently unenforced secondary sanctions against Russia (but leave enforcement of all these secondary sanctions in the hands of the Trump Administration);
- tighten existing sectoral sanctions against Russian state-owned energy, financial, and defense companies and threaten their expansion to the state-owned rail and mining/metal sectors; and
- expand authority to sanction Russian cyber-related activities.
These sanctions against Russia generally track those proposed in prior Senate legislation, with the addition of national interest waivers for certain new sanctions provisions.
CAATS also levies sanctions against North Korea and Iran. The North Korean provisions significantly expands secondary sanctions against that country, with a special emphasis on trade, shipping, financial services, and the energy sector. With respect to Iran, CAATS would impose a largely symbolic expansion of secondary sanctions against Iranian military activity and sharpen focus on the Iranian Revolutionary Guard Corps and its affiliates.
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