We anticipate that regulations to be promulgated will generally reflect the following:
“significant transaction” and “significant financial transaction” – For purposes of implementing section 5 of UFSA, as amended by section 226 of CAATSA, OFAC will consider the totality of the facts and circumstances when determining whether transactions or financial transactions are “significant.” OFAC will consider the following list of seven broad factors that can assist in the determination of whether a transaction is “significant”: (1) the size, number, and frequency of the transaction(s); (2) the nature of the transaction(s); (3) the level of awareness of management and whether the transaction(s) are part of a pattern of conduct; (4) the nexus between the transaction(s) and a blocked person; (5) the impact of the transaction(s) on statutory objectives; (6) whether the transaction(s) involve deceptive practices; and (7) such other factors that the Secretary of the Treasury deems relevant on a case-by-case basis. For purposes of section 5 of UFSA, a transaction is not significant if U.S. persons would not require specific licenses from OFAC to participate in it.
OFAC will generally interpret the term “financial transaction” broadly to encompass any transfer of value involving a financial institution. For example, the following is a non-exhaustive list of activities that OFAC would consider to be a “financial transaction”:
• The receipt or origination of wire transfers;
• The acceptance of commercial paper (both retail and wholesale), and the clearance of such paper (including checks and similar drafts);
• The receipt or origination of ACH or ATM transactions;
• The holding of nostro, vostro, or loro accounts;
• The provision of trade finance or letter of credit services;
• The provision of guarantees or similar instruments;
• The provision of investment products or instruments or participation in investments; and
• Any other transactions for or on behalf of, directly or indirectly, a person serving as a correspondent, respondent, or beneficiary.
“facilitated” – For purposes of implementing section 5 of UFSA, OFAC will generally interpret the term “facilitated” broadly. “Facilitated” refers to the provision of assistance for certain efforts, activities, or transactions, including the provision of currency, financial instruments, securities, or any other transmission of value; purchasing; selling; transporting; swapping; brokering; financing; approving; guaranteeing; the provision of other services of any kind; the provision of personnel; or the provision of software, technology, or goods of any kind.