[Federal Register Volume 87, Number 32 (Wednesday, February 16, 2022)]
[Rules and Regulations]
[Pages 8733-8735]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-03361]


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DEPARTMENT OF THE TREASURY

Office of Foreign Assets Control

31 CFR Part 544


Weapons of Mass Destruction Proliferators Sanctions Regulations

AGENCY: Office of Foreign Assets Control, Treasury.

ACTION: Final rule.

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SUMMARY: The Department of the Treasury's Office of Foreign Assets 
Control (OFAC) is amending the Weapons of Mass Destruction 
Proliferators Sanctions Regulations to revise an existing general 
license authorizing the provision of certain legal services and add a 
general license authorizing payments for legal services from funds 
originating outside the United States.

DATES: This rule is effective February 16, 2022.

FOR FURTHER INFORMATION CONTACT: OFAC: Assistant Director for 
Licensing, 202-622-2480; Assistant Director for Regulatory Affairs, 
202-622-4855; or Assistant Director for Sanctions Compliance & 
Evaluation, 202-622-2490.

SUPPLEMENTARY INFORMATION:

Electronic Availability

    This document and additional information concerning OFAC are 
available on OFAC's website: www.treasury.gov/ofac.

[[Page 8734]]

Background

    On April 13, 2009, OFAC issued the Weapons of Mass Destruction 
Proliferators Sanctions Regulations, 31 CFR part 544 (74 FR 16771, 
April 13, 2009) (the ``Regulations''), to implement Executive Order 
(E.O.) 13382 of June 28, 2005, ``Blocking Property of Weapons of Mass 
Destruction Proliferators and Their Supporters'' (70 FR 38567, July 1, 
2005). OFAC is amending the Regulations with respect to payments for 
legal services as set forth in more detail below.
    Section 544.507 of the Regulations authorizes U.S. persons to 
provide certain legal services to or on behalf of persons whose 
property and interests in property are blocked pursuant to Sec.  
544.201(a) provided that all receipts of payment of professional fees 
and reimbursement of incurred expenses must be specifically licensed. 
OFAC is revising Sec.  544.507 to remove the requirement that all 
receipts of payment of professional fees and reimbursement of incurred 
expenses must only be specifically licensed and to otherwise update 
language throughout the section so that Sec.  544.507 conforms with the 
legal services general license in other sanctions programs. OFAC is 
also redesignating Sec.  544.508 as Sec.  544.509 and adding a new 
general license at Sec.  544.508 authorizing a permissible payment 
mechanism for legal services without the need for a specific license. 
Specifically, new Sec.  544.508 authorizes payments from funds 
originating outside the United States and that do not come from a U.S. 
person or any person whose property and interests in property are 
blocked, other than the person on whose behalf the authorized legal 
services are provided. This payment mechanism has previously been 
incorporated into the regulations for a number of other sanctions 
programs.

Public Participation

    Because the Regulations involve a foreign affairs function, the 
provisions of E.O. 12866 of September 30, 1993, ``Regulatory Planning 
and Review'' (58 FR 51735, October 4, 1993), and the Administrative 
Procedure Act (5 U.S.C. 553) requiring notice of proposed rulemaking, 
opportunity for public participation, and delay in effective date are 
inapplicable. Because no notice of proposed rulemaking is required for 
this rule, the Regulatory Flexibility Act (5 U.S.C. 601-612) does not 
apply.

Paperwork Reduction Act

    The collections of information related to the Regulations are 
contained in 31 CFR part 501 (the ``Reporting, Procedures and Penalties 
Regulations''). Pursuant to the Paperwork Reduction Act of 1995 (44 
U.S.C. 3507), those collections of information have been approved by 
the Office of Management and Budget under control number 1505-0164. An 
agency may not conduct or sponsor, and a person is not required to 
respond to, a collection of information unless the collection of 
information displays a valid control number.

List of Subjects in 31 CFR Part 544

    Administrative practice and procedure, Banks, Banking, Blocking of 
assets, Credit, Foreign trade, Legal services, Penalties, 
Proliferation, Reporting and recordkeeping requirements, Sanctions, 
Securities, Services, Weapons of mass destruction.

    For the reasons set forth in the preamble, OFAC amends 31 CFR part 
544 as follows:

PART 544--WEAPONS OF MASS DESTRUCTION PROLIFERATORS SANCTIONS 
REGULATIONS

0
1. The authority citation for part 544 continues to read as follows:

    Authority: 3 U.S.C. 301; 31 U.S.C. 321(b); 50 U.S.C. 1601-1651, 
1701-1706; Pub. L. 101-410, 104 Stat. 890, as amended (28 U.S.C. 
2461 note); E.O. 12938, 59 FR 59099, 3 CFR, 1994 Comp., p. 950; E.O. 
13094, 63 FR 40803, 3 CFR, 1998 Comp., p. 200; E.O. 13382, 70 FR 
38567, 3 CFR, 2005 Comp., p. 170.

Subpart E--Licenses, Authorizations, and Statements of Licensing 
Policy

0
2. Revise Sec.  544.507 to read as follows:


Sec.  544.507  Provision of certain legal services.

    (a) The provision of the following legal services to or on behalf 
of persons whose property and interests in property are blocked 
pursuant to Sec.  544.201(a) is authorized, provided that any receipt 
of payment of professional fees and reimbursement of incurred expenses 
must be authorized pursuant to Sec.  544.508, which authorizes certain 
payments for legal services from funds originating outside the United 
States; via specific license; or otherwise pursuant to this part:
    (1) Provision of legal advice and counseling on the requirements of 
and compliance with the laws of the United States or any jurisdiction 
within the United States, provided that such advice and counseling are 
not provided to facilitate transactions in violation of this part;
    (2) Representation of persons named as defendants in or otherwise 
made parties to legal, arbitration, or administrative proceedings 
before any U.S. Federal, state, or local court or agency;
    (3) Initiation and conduct of legal, arbitration, or administrative 
proceedings before any U.S. Federal, state, or local court or agency;
    (4) Representation of persons before any U.S. Federal, state, or 
local court or agency with respect to the imposition, administration, 
or enforcement of U.S. sanctions against such persons; and
    (5) Provision of legal services in any other context in which 
prevailing U.S. law requires access to legal counsel at public expense.
    (b) The provision of any other legal services to or on behalf of 
persons whose property and interests in property are blocked pursuant 
to Sec.  544.201(a), not otherwise authorized in this part, requires 
the issuance of a specific license.
    (c) U.S. persons do not need to obtain specific authorization to 
provide related services, such as making filings and providing other 
administrative services, that are ordinarily incident to the provision 
of services authorized by paragraph (a) of this section. Additionally, 
U.S. persons who provide services authorized by paragraph (a) of this 
section do not need to obtain specific authorization to contract for 
related services that are ordinarily incident to the provision of those 
legal services, such as those provided by private investigators or 
expert witnesses, or to pay for such services. See Sec.  544.404.
    (d) Entry into a settlement agreement or the enforcement of any 
lien, judgment, arbitral award, decree, or other order through 
execution, garnishment, or other judicial process purporting to 
transfer or otherwise alter or affect property or interests in property 
blocked pursuant to Sec.  544.201(a) is prohibited unless licensed 
pursuant to this part.

    Note 1 to Sec.  544.507. Pursuant to part 501, subpart E, of 
this chapter, U.S. persons seeking administrative reconsideration or 
judicial review of their designation or the blocking of their 
property and interests in property may apply for a specific license 
from the Office of Foreign Assets Control (OFAC) to authorize the 
release of certain blocked funds for the payment of professional 
fees and reimbursement of incurred expenses for the provision of 
such legal services where alternative funding sources are not 
available.

Sec.  544.508   [Redesignated as Sec.  544.509]

0
3. Redesignate Sec.  544.508 as Sec.  544.509.

0
4. Add new Sec.  544.508 to subpart E to read as follows:

[[Page 8735]]

Sec.  544.508   Payments for legal services from funds originating 
outside the United States.

    (a) Professional fees and incurred expenses. (1) Receipt of payment 
of professional fees and reimbursement of incurred expenses for the 
provision of legal services authorized pursuant to Sec.  544.507(a) to 
or on behalf of any person whose property and interests in property are 
blocked pursuant to Sec.  544.201(a) is authorized from funds 
originating outside the United States, provided that the funds do not 
originate from:
    (i) A source within the United States;
    (ii) Any source, wherever located, within the possession or control 
of a U.S. person; or
    (iii) Any individual or entity, other than the person on whose 
behalf the legal services authorized pursuant to Sec.  544.507(a) are 
to be provided, whose property and interests in property are blocked 
pursuant to any part of this chapter or any Executive order or statute.
    (2) Nothing in paragraph (a) of this section authorizes payments 
for legal services using funds in which any other person whose property 
and interests in property are blocked pursuant to Sec.  544.201(a), any 
other part of this chapter, or any Executive order or statute has an 
interest.
    (b) Reports. (1) U.S. persons who receive payments pursuant to 
paragraph (a) of this section must submit annual reports no later than 
30 days following the end of the calendar year during which the 
payments were received providing information on the funds received. 
Such reports shall specify:
    (i) The individual or entity from whom the funds originated and the 
amount of funds received; and
    (ii) If applicable:
    (A) The names of any individuals or entities providing related 
services to the U.S. person receiving payment in connection with 
authorized legal services, such as private investigators or expert 
witnesses;
    (B) A general description of the services provided; and
    (C) The amount of funds paid in connection with such services.
    (2) The reports, which must reference this section, are to be 
submitted to OFAC using one of the following methods:
    (i) Email (preferred method): <a href="/cdn-cgi/l/email-protection#f6b9b0b7b5849386998482b6828493978583848fd8919980"><span class="__cf_email__" data-cfemail="377871767445524758454377434552564442454e19505841">[email protected]</span></a>; or
    (ii) U.S. mail: OFAC Regulations Reports, Office of Foreign Assets 
Control, U.S. Department of the Treasury, 1500 Pennsylvania Avenue NW, 
Freedman's Bank Building, Washington, DC 20220.

    Dated: February 11, 2022
Andrea M. Gacki
Director, Office of Foreign Assets Control.
[FR Doc. 2022-03361 Filed 2-15-22; 8:45 am]
BILLING CODE 4810-AL-P


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