The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) recently sanctioned six individuals, twenty-four entities, and seven vessels for their role in the exportation, refining, brokering, and sale of oil from Libya.
As set forth in OFAC’s press release regarding the implementation of sanctions, the six individuals who were Maltese, Libyan, and Egyptian nationals, engaged in a scheme to export petroleum products from Libya to Europe. The group moved the Libyan petroleum products to ports in Malta and Italy, and then sold the products through the use of falsified fuel certificates which concealed the origin of the oil. The group also used a shell Maltese company to transport the illicit fuel through Europe. OFAC acknowledged reports that the scheme had earned the group over 30 million euros.
OFAC’s statutory basis for issuing the sanctions is Executive Order 13726, an EO made by President Obama in April 2016. EO 13726 was designed to block property and individuals who are “contributing to the situation in Libya.” EO 13726 was itself and expansion of EO 13566 which declared a state of emergency in Libya in 2011 based on the ongoing violence, human rights violations, and violations of existing arms embargoes by Libya. EO 13726 contains broad language prohibiting, among other specific provisions, any “actions or policies that threaten the peace, security, or stability of Libya. Accordingly, OFAC needed only to determine that the groups activities threatened peace in Libya to issue sanctions under the authority of EO 13726. In issuing sanction, OFAC also noted that the group’s alleged conduct was condemned by United Nations Security Counsel Resolution 2146 (2014) as modified by 2362 (2017).
As a result of the sanctions, the individuals, entities, and vessels have been added to OFAC’s list Specially Designated Nationals. Accordingly, U.S. citizens and U.S. companies are prohibited from transacting business with the individuals, entities, and vessels.