OFAC takes the position that certain kinds of SDN participation in public conferences is not a prohibited service under U.S. sanctions law

The Foundation for Global Political Exchange (“GPE”) filed a license application in 2022 to request authorization to invite three SDNs designated pursuant to the Global Terrorism Sanctions Regulations (“GTSR”), Global Magnitsky Sanctions Regulations (“GMSR”), and the Lebanon Sanctions Regulations (“LSR”), and two non-SDN individuals who were associated with an SDN, Hizballah, designated under the GTSR, and the Foreign Terrorist Organization Regulations (“FTO”), and Syria sanctions programs, to participate in their annual Beirut Exchange in Lebanon. OFAC denied the application in 2022, which is consistent with OFAC’s historic position that such activity was considered a provision and receipt of a service prohibited under U.S. sanctions and was not in line with the agency’s licensing policy. GPE initiated litigation in federal court in late 2023 as a result of such denial.

On November 8, 2024, OFAC filed a letter in federal court¹ confirming that inviting these speakers to participate in a public conference for the purpose of facilitating political dialogue is actually not considered a prohibited service under U.S. sanctions law, based on the given circumstances, thus effectively resolving the court case. As explained below, OFAC’s analysis is narrowly tied to the specific facts and various factors OFAC mentioned in its letter, which make this guidance less applicable to public conferences at large.

OFAC initially denied GPE’s request to invite sanctioned speakers to the conference

GPE is a U.S.-registered non-profit organization that promotes “professional and academic enrichment through a variety of small group, direct engagement conferences in Western Asia and North Africa.” GPE primarily organizes “Exchanges”, or “small group, direct engagement conferences focused on the political dynamics of a specific country or region.” The Beirut Exchange gathers experts across professional capacities to engage in a deeper conversation regarding Lebanese political landscape. 

In April and June 2022, GPE requested authorization from OFAC to invite to the Beirut Exchange Usama Hamdan, Gebran Bassil, and Jamil Sayyed (SDNs under the GTSR, GMSR, and LSR respectively), and Ammar Moussawi and Ali Fayyad (non-SDNs who are former leaders of Hizballah, a designated entity). GPE wanted to invite these speakers to provide a perspective on the Lebanese conflict that is contrary to that of the U.S. and U.S. foreign policy historically. 

On December 6, 2022, OFAC denied their request, consistent with its long-standing guidance, on the basis that inviting these individuals would be a prohibited import of a service under U.S. sanctions because of their designations and associations with SDNs. Depending on the nature of the conference, OFAC has taken the position that allowing such individuals to participate may also be an export of a service to them, and OFAC did not find at a time that there was sufficient U.S. foreign policy or national security interest to approve a license authorizing such prohibited activity (i.e., OFAC denied the application saying it was not consistent with the agency’s licensing policy).

U.S. sanctions prohibit dealings in property and provision or receipt of services involving SDNs 

The GTSR, GSMR, and LSR prohibit U.S. persons from dealing in property or interests in property of  persons blocked pursuant to those sanctions programs. See 31 CFR parts 594, 583, and 549. This includes a prohibition on making or receiving a contribution of funds, goods, or services to or for individuals with blocked property or interests in property. The regulations define “property” very broadly as “services of any nature whatsoever…and any other property, real, personal, or mixed, tangible or intangible, or interest or interests therein, present, future, or contingent.” See 31 CFR § 594.309; 31 CFR § 583.311; and 31 CFR § 549.308. “Services” is not explicitly defined but includes “legal, accounting, financial, brokering, freight forwarding, transportation, public relations, educational, or other services” See Sections 594.406(b), 583.405(b), and 549.405(b).

OFAC’s denial of GPE’s request was consistent with OFAC Frequently Asked Question 812, which confirms that “any transaction or dealing by a U.S. person in any property or interests in property of persons designated as SDGTs under or otherwise blocked pursuant to E.O. 13224 is prohibited. Such property includes artwork and other information and information materials.” The legal basis of Executive Order (“E.O.”) 13224, which is implemented by the GTSR, includes the United Nations Participation Act (“UNPA”) in addition to the International Emergency Economic Powers Act (“IEEPA”). The same exemptions in IEEPA are not automatically available for sanctions programs that are implemented pursuant to the UNPA. In the FAQ 812, OFAC has stated that “certain exemptions available under the International Emergency Economic Powers Act (IEEPA) relating to personal communications, humanitarian donations, information or informational materials, and travel do not apply to transactions with SDGTs or persons otherwise blocked pursuant to E.O. 13224.”

OFAC confirms that inviting SDNs to a public conference is not a prohibited service under U.S. sanctions law under specific circumstances 

On November 8, 2024, OFAC revoked its denial of GPE’s license application and “determined that including sanctioned persons as speakers at the Beirut Exchange, including actions ordinarily incident to facilitating their participation as speakers, under the circumstances [GPE has] described, is not a service prohibited by U.S. sanctions and thus no authorization is necessary.” 

OFAC cited the exemptions available under the International Emergency Economic Powers Act (“IEEPA”), which prevents regulating or prohibiting “directly or indirectly…any postal, telegraphic, telephonic, or other personal communication, which does not involve a transfer of anything of value…or, the importation from any country, or the exportation to any country, whether commercial or otherwise,…of any information or informational materials.” 50 U.S.C. § 1702(b)(1), (3). However, based on OFAC’s subsequent analysis in its letter, the agency did not rely on IEEPA exemptions at all, which is consistent with FAQ 812’s statement: “Certain exemptions available under the International Emergency Economic Powers Act (IEEPA) relating to personal communications, humanitarian donations, information or informational materials, and travel do not apply to transactions with SDGTs or persons otherwise blocked pursuant to E.O. 13224.”

Of the invited speakers, Usama Hamdan is designated under the GTSR, which implements E.O. 13224, “Blocking Property and Prohibiting Transactions With Persons Who Commit, Threaten to Commit, or Support Terrorism.” Therefore, because that EO is based on the UNPA and IEEPA (rather than on IEEPA authority alone), designation under that sanctions programs prevents automatic application of the aforementioned IEEPA exemptions. 

Instead of relying on an IEEPA exemption, OFAC reached its  determination that inviting these speakers under this set of specific facts and circumstances related to political speech is not a prohibited service (and therefore not a dealing in “property”) under U.S. sanctions law because of the following factors: 

• GPE did not engage in any financial transaction with an individual listed on OFAC’s Specially Designated Nationals and Blocked Persons (“SDN List”);
• GPE did not offer transportation, lodging, good[s], or any other service or “thing of value” such as an honorarium to any blocked person or one who is otherwise subject to U.S. sanctions;
• GPE’s Exchanges are organized and hosted solely by GPE and not carried out on behalf of any other person or entity, or any blocked person; and
• GPE did not provide any training or assistance to the speakers in advance of their participation in the event. 

OFAC cautionary guidance

Based on these factors, OFAC determined that including sanctioned persons as speakers at the Beirut Exchange for the purpose of facilitating political dialogue is not a prohibited service under U.S. sanctions. OFAC reiterated that the participation of sanctioned persons at other GPE Exchanges, either in-person or virtually, under these facts and having satisfied the aforementioned four elements is similarly permitted.

However, this interpretation does not apply broadly to all activities involving SDNs and conferences hosted by U.S. persons. In the same letter, OFAC stated it is “not prohibit[ing] the type of conduct described here,” but that it is “aware of instances where sanctioned persons have used conferences to engage in conduct that threatens U.S. national security, such as using conferences as a platform to recruit and collect intelligence on attendees,” amongst other efforts. Therefore, if SDNs are being considered for inclusion at future public conferences, whether that involvement is not considered a prohibited service depends on the nature of the topic and/or factors such as: 

1. The host or party extending the invitation engages in any financial transaction with the SDN or an individual affiliated with an SDN;
2. The host or party extending the invitation offers transportation, lodging, goods, or other services or “things of value” (e.g., an honorarium) to an SDN or person associated with an SDN;
3. The public conference is also hosted or organized, directly or indirectly, by or carried out on behalf of SDNs;
4. The host or party extending the invitation provides any training or assistance to the SDN speakers in the public conference;
5. The SDN provides training or assistance to others during the public conference; and
6. The SDN will use the conference to engage in conduct that threatens U.S. national security (e.g., such as using the conference as a platform to recruit or collect intelligence on attendees) — this last factor can be particularly difficult to satisfy.

If you have any questions regarding this OFAC guidance, please let us know.

Authored by Beth Peters, Aleksandar Dukic, Ashley Roberts, Ajay Kuntamukkala, Stephen Propst, Anthony Capobianco, Josh Gelula, Brian Curran, Deborah Wei, and Nicki Ghazarian-Foye.