Publication of Updated Guidance on Implementation of the Price Cap Policy for Crude Oil and Petroleum Products of Russian Federation Origin; Russia-related Designations; Counter-Narcotics Designations Removals; Issuance of Russia-related General Licenses

The Office of Foreign Assets Control (OFAC) has published a press release to inform about new sanction measures. Specifically, the Office announced that it has
– added various entities and one vessel to its Specially Designated Nationals and Blocked Persons List (SDN List) due to their involvement in the circumvention of the Russian oil price cap;
– issued two new general licenses in relation to the new designations;
– removed numerous individuals and entities from its SDN list which were previously designated for being engaged in drug trafficking pursuant to Executive Order 14059; and
– updated its Guidance on [the] implementation of the Price Cap Policy for Crude Oil and Petroleum Products of Russian Federation Origin following the G7’s decision to tighten enforcement and controls in this matter.
Each action is briefly described below.
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The following entities and vessel were added to the SDN list:
##### Added entities
BELLATRIX ENERGY LIMITED, Unit 601, 6/F of Mill 5 of the Mills, 45 Pak Tin Par Street, Hong Kong, China; Organization Established Date 09 Dec 2020; Registration Number 3000934 (Hong Kong) [RUSSIA-EO14024].
COVART ENERGY LIMITED, 5/F, Lee Garden Three, 1 Sunning Road, Causeway Bay, Hong Kong, China; Ofis 417, Ul. Maksima Gorkogo 276, Rostov-na-Donu 344019, Russia; Organization Established Date 08 Nov 2019; Identification Number IMO 6357849; Registration Number 2890985 (Hong Kong) [RUSSIA-EO14024].
SUN SHIP MANAGEMENT D LTD (a.k.a. SCF MANAGEMENT SERVICES DUBAI LTD), PO Box 507065, Unit OT 17-32, Central Park Towers, Office Tower, Dubai, United Arab Emirates; Organization Established Date 02 Aug 2012; UAE Identification 1244 (United Arab Emirates); Registration Number 11440513 (United Arab Emirates) [RUSSIA-EO14024].
VOLITON DMCC (a.k.a. PETROKIM TRADING MIDDLE EAST AND ASIA DMCC), Unit No: R29-33, Reef Tower, Plot No: JLT-PH2-O1A, Jumeirah Lakes Towers, Dubai, United Arab Emirates; Organization Established Date 22 May 2018; License DMCC-476388 (United Arab Emirates); Registration Number 124420 (United Arab Emirates) [RUSSIA-EO14024].
##### Added vessel
SANAR 15 (UALW) Oil Products Tanker Russia flag; Vessel Registration Identification IMO 9777670; MMSI 273375360 (vessel) [RUSSIA-EO14024] (Linked To: COVART ENERGY LIMITED).
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The following licenses were issued by OFAC to permit otherwise prohibited actions in relation to the newly sanctioned entities
1. General Licence 81 to permit financial transactions of the four above noted entities that are necessary for the provision of emergency repairs to vessels owned or controlled by these entities or for the safety of their crew members. However, any payments to these entities must be made to frozen accounts.
2. General Licence 82 to permit financial transactions that are necessary to wind-down any engagements with SUN Ship Management D Ltd or any entity owned or controlled by such (ownership of 50% or more) provided that payments are made to frozen accounts only.
Both licenses are time-limited up to March 19, 2024.
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Removal of previously designated persons and entities
As the number of removed sanctioned persons and entities is very large, we refrain from listing them individually at this point. Please refer to the enclosed press release for their names, information on residency, date of birth (if applicable), or the reasons for the sanction measures.
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Updated „OFAC Guidance on Implementation of the Price Cap Policy for Crude Oil and Petroleum Products of Russian Federation Origin“
The G7 recently decided to enhance the restrictions on the Russian oil price cap by imposing sanctions on those that engage in deceptive practices to circumvent the cap and by enhancing the recordkeeping requirements of ALL firms down the value chain to require the splitting of any transportation-associated costs so as to enable the determination of the „true“ price of the oil and to require all firms down the value chain to furnish such information upon request. The G7 also enhanced the entire attestation process in this context.
These changes are now reflected in the new version of the guidance which outlines the policies and procedures import / export firms, financial institutions, and other entities (e.g. insurance firms) are expected to have in place and to follow to be safe from possible violations of the price cap requirements for the (indirect) transport or importation of Russian crude oil or petroleum products. Changes have thereby been made throughout the entire document which is why we refrain from pinpointing individual pages or provisions.