Source: https://www.federalregister.gov/documents/2011/02/11/2011-3040/iranian-human-rights-abuses-sanctions-regulations
Timestamp: 2018-08-15 13:39:30
Document Index: 498311951

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Federal Register :: Iranian Human Rights Abuses Sanctions Regulations
A Rule by the Foreign Assets Control Office on 02/11/2011
7695-7701 (7 pages)
31 CFR 562
List of Subjects in 31 CFR Part 562
https://www.federalregister.gov/d/2011-3040 https://www.federalregister.gov/d/2011-3040
The Department of the Treasury's Office of Foreign Assets Control (“OFAC”) is issuing regulations with respect to Iran to implement Executive Order 13553 of September 28, 2010. OFAC intends to supplement this part 562 with a more comprehensive set of regulations, which may include additional interpretive and definitional guidance and additional general licenses and statements of licensing policy.
Effective Date: February 11, 2011.
On September 28, 2010, the President issued Executive Order 13553 (75 FR 60567, October 1, 2010) (“E.O. 13553”), invoking the authority of, inter alia, the International Emergency Economic Powers Act (50 U.S.C. 1701-1706) and the Comprehensive Iran Sanctions, Accountability, and Divestment Act of 2010 (Pub. L. 111-195), and in order to take additional steps with respect to the national emergency declared in Executive Order 12957 of March 15, 1995, with respect to Iran.
The Department of the Treasury's Office of Foreign Assets Control is issuing the Iranian Human Rights Abuses Sanctions Regulations, 31 CFR part 562 (the “Regulations”), to implement E.O. 13553 pursuant to authorities delegated to the Secretary of the Treasury in E.O. 13553. A copy of E.O. 13553 appears in appendix A to this part.
The Regulations are being published in abbreviated form at this time for the purpose of providing immediate guidance to the public. OFAC intends to supplement this part 562 with a more comprehensive set of regulations, which may include additional interpretive and definitional guidance and additional general licenses and statements of licensing policy. The appendix to the Regulations will be removed when OFAC supplements this part with a more comprehensive set of regulations.
For the reasons set forth in the preamble, the Department of the Treasury's Office of Foreign Assets Control adds part 562 to 31 CFR Chapter V to read as follows:
562.307
562.310
562.401
562.402
562.403
Setoffs prohibited.Start Printed Page 7696
562.406
562.502
562.505
Authority: 3 U.S.C. 301; 18 U.S.C. 2332d; 31 U.S.C. 321(b); 50 U.S.C. 1601-1651, 1701-1706; Pub. L. 101-410, 104 Stat. 890 (28 U.S.C. 2461 note); Pub. L. 110-96, 121 Stat. 1011 (50 U.S.C. 1705 note); Pub. L. 111-195, 124 Stat. 1312 (22 U.S.C. 8501-8551); E.O. 12957, 60 FR 14615, 3 CFR, 1995 Comp., p. 332; E.O. 13553, 75 FR 60567, October 1, 2010.
§ 562.101
Note to § 562.101:
§ 562.201
All transactions prohibited pursuant to Executive Order 13553 are also prohibited pursuant to this part.
Note 1 to § 562.201:
The names of persons listed in or designated pursuant to Executive Order 13553, whose property and interests in property are blocked pursuant to this section, are published on the Office of Foreign Assets Control's Specially Designated Nationals and Blocked Persons List (“SDN” list) (which is accessible via the Office of Foreign Assets Control's Web site), published in the Federal Register, and incorporated into Appendix A to this chapter with the identifier “[IRAN-HR]”. See § 562.406 concerning entities that may not be listed on the SDN list but whose property and interests in property are nevertheless blocked pursuant to this section.
Note 2 to § 562.201:
The International Emergency Economic Powers Act (50 U.S.C. 1701-1706) (“IEEPA”), in Section 203 (50 U.S.C. 1702), explicitly authorizes the blocking of property and interests in property of a person during the pendency of an investigation. The names of persons whose property and interests in property are blocked pending investigation pursuant to this part also are published on the SDN list, published in the Federal Register, and incorporated into Appendix A to this chapter with the identifier “[BPI-IRAN-HR]”.
Note 3 to § 562.201:
§ 562.202
(a) Any transfer after the effective date that is in violation of any provision of this part or of any regulation, order, directive, ruling, instruction, or license issued pursuant to this part, and that involves any property or interest in property blocked pursuant to § 562.201, is null and void and shall not be the basis for the assertion or recognition of any interest in or right, remedy, power, or privilege with respect to such property or property interests.
(b) No transfer before the effective date shall be the basis for the assertion or recognition of any right, remedy, power, or privilege with respect to, or any interest in, any property or interest in property blocked pursuant to § 562.201, unless the person who holds or maintains such property, prior to that date, had written notice of the transfer or by any written evidence had recognized such transfer.
(iii) If a license did purport to cover the transfer, such license had been obtained by misrepresentation of a third Start Printed Page 7697party or withholding of material facts or was otherwise fraudulently obtained.
Note to paragraph (d) of § 562.202:
(e) Unless licensed pursuant to this part, any attachment, judgment, decree, lien, execution, garnishment, or other judicial process is null and void with respect to any property in which, on or since the effective date, there existed an interest of a person whose property and interests in property are blocked pursuant to § 562.201.
§ 562.203
(a) Except as provided in paragraphs (c) or (d) of this section, or as otherwise directed by the Office of Foreign Assets Control, any U.S. person holding funds, such as currency, bank deposits, or liquidated financial obligations, subject to § 562.201 shall hold or place such funds in a blocked interest-bearing account located in the United States.
(c) Blocked funds held in instruments the maturity of which exceeds 180 days at the time the funds become subject to § 562.201 may continue to be held until maturity in the original instrument, provided any interest, earnings, or other proceeds derived therefrom are paid into a blocked interest-bearing account as described in paragraphs (b) or (d) of this section.
(d) Blocked funds held in accounts or instruments outside the United States at the time the funds become subject to § 562.201 may continue to be held in the same type of accounts or instruments, provided the funds earn interest at rates that are commercially reasonable.
(f) Funds subject to this section may not be held, invested, or reinvested in a manner that provides immediate financial or economic benefit or access to any person whose property and interests in property are blocked pursuant to § 562.201, nor may their holder cooperate in or facilitate the pledging or other attempted use as collateral of blocked funds or other assets.
§ 562.301
The terms blocked account and blocked property shall mean any account or property subject to the prohibitions in § 562.201 held in the name of a person whose property and interests in property are blocked pursuant to § 562.201, or in which such person has an interest, and with respect to which payments, transfers, exportations, withdrawals, or other dealings may not be made or effected except pursuant to an authorization or license from the Office of Foreign Assets Control expressly authorizing such action.
Note to § 562.301:
See § 562.406 concerning the blocked status of property and interests in property of an entity that is 50 percent or more owned by a person whose property and interests in property are blocked pursuant to § 562.201.
§ 562.302
(a) With respect to a person listed in the Annex to Executive Order 13553, 12:01 a.m. eastern daylight time, September 29, 2010; or
(b) With respect to a person whose property and interests in property are otherwise blocked pursuant to Executive Order 13553, the earlier of the date of actual or constructive notice that such person's property and interests in property are blocked.
§ 562.303
§ 562.304
§ 562.305
Note to § 562.305:
§ 562.306
§ 562.307
The terms property and property interest include, but are not limited to, money, checks, drafts, bullion, bank deposits, savings accounts, debts, indebtedness, obligations, notes, guarantees, debentures, stocks, bonds, coupons, any other financial instruments, bankers acceptances, mortgages, pledges, liens or other rights in the nature of security, warehouse receipts, bills of lading, trust receipts, bills of sale, any other evidences of title, ownership or indebtedness, letters of credit and any documents relating to any rights or obligations thereunder, powers of attorney, goods, wares, merchandise, chattels, stocks on hand, ships, goods on ships, real estate mortgages, deeds of trust, vendors' sales agreements, land contracts, leaseholds, ground rents, real estate and any other interest therein, options, negotiable instruments, trade acceptances, royalties, book accounts, accounts payable, judgments, patents, trademarks or copyrights, insurance policies, safe deposit boxes and their contents, annuities, pooling agreements, services of any nature whatsoever, contracts of any nature whatsoever, and any other property, real, personal, or mixed, tangible or intangible, or interest or Start Printed Page 7698interests therein, present, future, or contingent.
§ 562.308
§ 562.309
§ 562.310
§ 562.311
§ 562.401
§ 562.402
§ 562.403
(a) Whenever a transaction licensed or authorized by or pursuant to this part results in the transfer of property (including any property interest) away from a person, such property shall no longer be deemed to be property blocked pursuant to § 562.201, unless there exists in the property another interest that is blocked pursuant to § 562.201 or any other part of this chapter, the transfer of which has not been effected pursuant to license or other authorization.
(b) Unless otherwise specifically provided in a license or authorization issued pursuant to this part, if property (including any property interest) is transferred or attempted to be transferred to a person whose property and interests in property are blocked pursuant to § 562.201, such property shall be deemed to be property in which that person has an interest and therefore blocked.
§ 562.404
(a) An ordinarily incident transaction, not explicitly authorized within the terms of the license, by or with a person whose property and interests in property are blocked pursuant to § 562.201; or
§ 562.405
A setoff against blocked property (including a blocked account), whether by a U.S. bank or other U.S. person, is a prohibited transfer under § 562.201 if effected after the effective date.
§ 562.406
A person whose property and interests in property are blocked pursuant to § 562.201 has an interest in all property and interests in property of an entity in which it owns, directly or indirectly, a 50 percent or greater interest. The property and interests in property of such an entity, therefore, are blocked, and such an entity is a person whose property and interests in property are blocked pursuant to § 562.201, regardless of whether the entity itself is listed in the Annex or designated pursuant to Executive Order 13553.
§ 562.501
§ 562.502
§ 562.503
§ 562.504
Any payment of funds or transfer of credit in which a person whose property Start Printed Page 7699and interests in property are blocked pursuant to § 562.201 has any interest that comes within the possession or control of a U.S. financial institution must be blocked in an account on the books of that financial institution. A transfer of funds or credit by a U.S. financial institution between blocked accounts in its branches or offices is authorized, provided that no transfer is made from an account within the United States to an account held outside the United States, and further provided that a transfer from a blocked account may be made only to another blocked account held in the same name.
Note to § 562.504:
See § 501.603 of this chapter for mandatory reporting requirements regarding financial transfers. See also § 562.203 concerning the obligation to hold blocked funds in interest-bearing accounts.
§ 562.505
§ 562.506
(a) The provision of the following legal services to or on behalf of persons whose property and interests in property are blocked pursuant to § 562.201 is authorized, provided that all receipts of payment of professional fees and reimbursement of incurred expenses must be specifically licensed:
(b) The provision of any other legal services to persons whose property and interests in property are blocked pursuant to § 562.201, not otherwise authorized in this part, requires the issuance of a specific license.
(c) 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 § 562.201 is prohibited unless licensed pursuant to this part.
§ 562.507
The provision of nonscheduled emergency medical services in the United States to persons whose property and interests in property are blocked pursuant to § 562.201 is authorized, provided that all receipt of payment for such services must be specifically licensed.
§ 562.801
§ 562.802
Any action that the Secretary of the Treasury is authorized to take pursuant to Executive Order 13553 of September 28, 2010 (75 FR 60567, October 1, 2010), and any further Executive orders relating to the national emergency declared in Executive Order 12957, may be taken by the Director of the Office of Foreign Assets Control or by any other person to whom the Secretary of the Treasury has delegated authority so to act.
§ 562.901
(C) to be owned or controlled by, or to have acted or purported to act for or on behalf of, directly or indirectly, any person whose Start Printed Page 7700property and interests in property are blocked pursuant to this order.
Approved: February 4, 2011.
[FR Doc. 2011-3040 Filed 2-10-11; 8:45 am]