February 21, 2020

OFAC releases new FAQs regarding the Reporting, Procedures and Penalties Regulations

On Tuesday, February 20th, OFAC released FAQs 819 and 820 informing parties that OFAC expects all US persons, and persons otherwise subject to US jurisdiction, to comply with the updated instruction and reporting requirements for parties submitting reports on blocked property, unblocked property, or rejected transactions in the amended Reporting, Procedures and Penalties Regulations. 31 CFR Part 501.  OFAC emphasized that the requirement for parties to provide reports regarding rejected transactions within 10 business days of the rejection has been expanded to include all U.S. persons and persons otherwise subject to US jurisdiction.  The requirement to report rejected transactions was previously limited to financial institutions. 

OFAC further stated that parties are expected to provide all information required by Section 501.604 (b) that is in the filer’s possession when submitting a rejected transaction report.  FAQ 820 notes that parties submitting a rejected transaction report are not required to seek information from the counterparty for the sole purpose of  providing all the required information.  However, OFAC does expect the report to contain the required information that is applicable in all reject scenarios (e.g., information regarding the submitter of the report, the date the transaction was rejected, the legal authority under which the transaction was rejected, and any relevant documents received in connection with the transaction).

The full list of information required by Section 501.64 (b)  when submitting a rejected transaction report is:

1. Name and address of the person that rejected the transaction and a contact that can provide additional information;
2. A description of the rejected transaction;
3. If applicable, the associated sanctions target that caused the transaction to be rejected, the location of the sanctions target if known, and if not, a narrative description of the sanctions target’s interest in the transaction;
4. The date the transaction was rejected;
5. The actual or estimated value of the transaction in USD;
6. The legal authority or authorities under which the transaction was rejected; and
7. A copy of the any relevant documentation received in connection with the transaction.

RPPR – 31 CFR Part 501