On August 25, 2017, President Trump issued an Executive Order severely restricting transactions in debt and equity of the Government of Venezuela and of state-owned entities; including Petroleos de Venezuela; S.A. (PdVSA). Simultaneously with the Executive Order; OFAC issued a number of general licenses and Frequently Asked Questions relating to the new sanctions. These new actions build on sanctions targeting Venezuelan officials; discussed here; and continue the trend toward targeted “bespoke” sanctions short of full blocking of all transactions with a targeted regime or country.
The new sanctions:
- Prohibit dealings in existing debt of the Government of Venezuela (and its controlled entities) by U.S. persons or within U.S. jurisdiction; subject to an extensive list of exceptions for specified issuances;
- Prohibit all dealings by U.S. persons or within U.S. jurisdiction in new debt of the Government of Venezuela with a duration of longer than 30 days and of PdVSA with a duration of longer than 90 days; or new equity of any state-controlled entity;
- Bar the purchase of securities from the Government of Venezuela within U.S. jurisdiction; other than permitted new debt; and
- Bar all distributions of profits and earnings within U.S. jurisdiction to the Government of Venezuela by state-owned entities.
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