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The US Treasury just amended Obama's sanctions order to 'authorize certain transactions' with Russia's FSB

Feb 2, 2017, 22:44 IST

Russian President Vladimir Putin holds a meeting with the Cabinet in the Novo-Ogaryovo residence outside Moscow, Russia, Wednesday, Feb. 1, 2017. (Alexei Nikolsky/Pool Photo via AP

The US Treasury Department's Office of Foreign Assets Control (OFAC) published an amendment to President Barack Obama's sanctions order against Russia to "authorize certain transactions" with Russia's Federal Security Service.

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The new authorization will allow US companies to pay up to $5,000 per year to the FSB - which oversees technology imports into Russia - to secure licenses from the security services to export information technology products to Russia, as long as other aspects of the sanctions order aren't violated.

Obama issued harsh sanctions against the FSB first in April 2015 and again in December for its alleged role in a Russian hacking campaigns targeting US citizens and infrastructure.

US citizens and companies were prohibited from doing business with FSB entitities after the sanctions were imposed, but that may have been an "unintended consequence" of the original sanctions order, according to Eric Lorber, a senior advisor at the Foundation for Defense of Democracies' Center on Sanctions and Illicit Finance.

"The new General License permits US persons who are shipping technology goods to Russia (which is generally permitted) to get certificates/licenses, etc. from the FSB to continue exporting those goods to Russia," Lorber explained.

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"Once the FSB was designated [by Obama], however, securing these licenses became prohibited, and US exporters could no longer send their goods to Russia," Lorber said. "This was very likely an unintended consequence of the 13694 designation, and hence why OFAC provided a GL to correct" it.

The change came during President Donald Trump's second week in office. Trump and Russian President Vladimir Putin spoke by phone last Saturday in which they "underlined the importance of restoring mutually profitable trade and economic connections between the business circles of the two countries," according to a readout from the Kremlin after Saturday's call, Trump and Putin's conversation.

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