OFAC Issues Iran Licenses to Maintain Authorizations Threatened by EO

February 16, 2012 by Brian Feito|Exports, OFAC and DoD

Effective February 6, 2012, the Office of Foreign Assets Control has issued two general licenses maintaining authorizations that would have been rendered invalid by the recent Executive Order blocking property of the government of Iran and Iranian financial institutions Including the Central Bank of Iran (EO 13599). General License A authorizes almost all transactions that are allowed under existing general and specific licenses, while General License B authorizes non-commercial, personal remittances.

EO 13599 Renders OFAC Licenses Invalid. OFAC states that certain existing general licenses set forth in the Iranian Transactions Regulations (ITR), and certain specific licenses issued pursuant to 31 CFR Chapter V, authorize transactions with the “Government of Iran” or “Iranian financial institutions” as these terms are defined by EO 13599. The issuance of EO 13599 would have rendered these general and specific licenses invalid and prohibited noncommercial remittances. OFAC has issued two new General Licenses, A and B, to maintain authorization for most of the previously allowed transactions and licenses.

General License A Maintains Authorization, with Exceptions. Under General License A, almost all transactions that are authorized under existing general licenses issued pursuant to the ITR or under existing OFAC specific licenses will continue to be authorized. However, the following authorizations have been modified:

The closing of accounts of the Government of Iran or an Iranian financial institution and the lump sum transfer of the balances to an account outside the U.S., is not authorized by General License A.
Payments from blocked funds or debits to blocked accounts are not authorized by General License A, with a limited exception for payments from funds or debits to accounts blocked under the Iranian Assets Control Regulations that are authorized by specific licenses issued by OFAC.
Certain types of specific licenses previously without an expiration date will expire on April 6, 2012.

General License B Authorizes Remittances. General License B authorizes U.S. depository institutions and U.S. registered brokers or dealers in securities to process transfers of funds to or from Iran or for or on behalf of an Iranian resident, in cases in which the transfer involves a noncommercial, personal remittance, subject to certain restrictions and provided they are processed through a third country.

(See ITT’s Online Archives 12120710 for a summary of EO 13599.)

Treasury FAQs available here.