A Follow-up to the OFAC Primer on Personal Affairs

The posting immediately below on how the United States’ Department of Treasury’s Office of Foreign Assets Control (OFAC) regulations governing dealings with Iran garnered significant attention to say the least. The only real advertisement this posting had was on my law firm’s Facebook page, but nonetheless it resulted in a skyrocketing of daily hits to this blog as well as countless phone calls to my firm.

While I took great care in crafting this article to make sure that people understand the nuances of the law, I am still seeing some of the same misconceptions. As such, I have posted the below “Frequently Asked Questions” (FAQ):

1. What part of a personal transaction requires a specific license from OFAC?

Many people are still under the impression that licenses from OFAC are for the movement of money from Iran to the United States.  In reality, you need a license for most of the underlying transactions that result in cash, such as selling property, hiring a realtor, a lawyer,  giving a power of attorney to somebody in Iran to sell property on your behalf, or opening a bank account in Iran in order to transmit proceeds to the United States.  People with cash in Iran (i.e., no sale of property involved) have submitted applications for licenses, but the law is quite clear that if you (as a U.S. person) have property in Iran that you need to sell, then a license is required.

2. How long have these laws been in effect?

In reality, this regulation has little to do with the new round of regulations that were signed into law in July, the Comprehensive Iran Sanctions Accountability and Divestment Act of 2010, the “CISADA.”  President Clinton imposed a very comprehensive trade embargo on Iran in 1995.  These regulations, codified largely in the Iranian Transactions Regulations (the ITR) have been modified over the years, but many of the basic provisions have been on the books for over 10 years.  This is not a new requirement.

3.  Can a U.S. person work in Iran?

Generally no, unless your situation fits in an exception or you are licensed.  As a U.S. person, working in Iran constitutes the exportation of a “service” to Iran.  Therefore, this is largely prohibited.  Examples would be a U.S. person (remember, the law does not provide any exceptions to individuals also holding Iranian citizenship) who goes and practices medicine in Iran or teaches in a university a few months a year.  These such activities typically require prior authority from OFAC, namely in the form of a specific license issued.

Navigating the web of U.S. sanctions against Iran (or any other country for that matter) is complicated.  Make sure you seek expert advice and are adequately informed.

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