Weapons of Mass Destruction Proliferators Sanctions Regulations

CourtForeign Assets Control Office
Citation87 FR 8733
Publication Date16 February 2022
Record Number2022-03361
Federal Register, Volume 87 Issue 32 (Wednesday, February 16, 2022)
[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): [email protected]; 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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