Frequently Asked Questions

969. Does OFAC’s 50 Percent Rule apply to foreign financial institutions listed in Annex 1 to Directive 2 under Executive Order (E.O.) 14024, “Prohibitions Related to Correspondent or Payable-Through Accounts and Processing of Transactions Involving Certain Foreign Financial Institutions” (Russia-related CAPTA Directive)?

Answer

Yes.  The prohibitions of the Russia-related CAPTA Directive apply to any foreign financial institution listed in Annex 1 to the Russia-related CAPTA Directive or otherwise determined to be subject to the prohibitions of the Russia-related CAPTA Directive, “or their property or interests in property,” which includes foreign financial institutions 50 percent or more owned, directly or indirectly, individually or in the aggregate, by one or more foreign financial institutions determined to be subject to the prohibitions of the Russia-related CAPTA Directive.  As stated in the Russia-related CAPTA Directive, the prohibitions of this directive apply only with respect to a U.S. financial institution’s opening or maintaining of a correspondent account or payable-through account for or on behalf of, or processing of a transaction involving, a “foreign financial institution,” as defined in the Russia-related CAPTA Directive.  Thus, for purposes of the Russia-related CAPTA Directive, the prohibitions of this directive do not apply to non-“foreign financial institutions,” even if those non-“foreign financial institutions” are 50 percent or more owned, directly or indirectly, individually or in the aggregate, by one or more “foreign financial institutions” determined to be subject to this directive.

Date Released
February 24, 2022