On 22 July, the Office of Foreign Assets Control (OFAC) issued guidance on extension of the statute of limitations from 5 to 10 years for violation of certain sanctions.
Up until April 2024, civil enforcement actions for sanctions violations brought by OFAC were subject to a five-year statute of limitations, which corresponded to the five-year required recordkeeping period. On 24 April 2024, the US President Joe Biden signed into law H.R. 815, the National Security Supplemental. The new law extended, from five years to ten years, the statute of limitations for civil and criminal violations of the International Emergency Economic Powers Act (IEEPA) or the Trading with the Enemy Act (TWEA).
What it means for companies?
OFAC may now commence an enforcement action for violations of TWEA and IEEPA-based sanctions prohibitions within 10 years of the latest date of violation if it happened after 24 April 2019.
What companies should do to prevent sanctions violations?
It is recommended that companies update their retention policies and procedures to reflect the change to ten years. It is also advisable for companies to have a longer "look back" period to evaluate their transactions and conduct. The due diligence efforts should be increased and compliance procedures may be modified if necessary. It is also advisable to have rigorous compliance training, covering sanctions matters.
How Gherson can help
Gherson lawyers can help you to navigate the complexity of sanctions legislation and ensure your full compliance with it. We can assist in developing your company compliance policies, including sanction policies and deliver training to your employees, both in the UK or overseas.
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