OFAC Issues New FAQs on Chinese Military-Industrial Complex Sanctions

OFAC issued guidance concerning the Chinese Military-Industrial Complex ("CMIC") Sanctions Regulations.

OFAC published three new Frequently Asked Questions:

• FAQ 1046, which clarifies that U.S. persons do not need to divest current holdings of CMIC securities before the end of the relevant 365-day period, pursuant to Executive Order 13959 ("Addressing the Threat From Securities Investments That Finance Communist Chinese Military Companies") as amended;

• FAQ 1047, which clarifies that U.S. persons who hold securities of CMICs may continue to receive cash dividends and stock splits related to such covered securities, and U.S. financial institutions may continue to process such transactions. However, purchases of CMIC securities through dividend reinvestments are prohibited, although U.S. persons may continue to facilitate the distribution of dividend reinvestments for non-U.S. persons; and

• FAQ 1048, which notifies U.S. financial institutions that the purchase or sale of CMIC securities are not required to be blocked after the end of the relevant 365-day period, unless otherwise prohibited under EO 13959, as amended. Institutions may continue to facilitate purchases and sales on behalf of non-U.S. persons.