U.S. Targets Price Cap Evaders, Bans Russian Diamonds
The U.S. sanctioned three Emirati shipping companies on Thursday and a Russian-controlled one registered in Liberia for violating the G7's oil price cap, according to the U.S. Treasury Department, which also blocked a tanker operated by two of them.
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OFAC also restricted the importation of two categories of diamonds mined in Russia. Non-industrial diamond imports will be prohibited, regardless of whether they have been substantially transformed in a third country, as of March 1 for some categories of diamonds and expanding on Sept. 1 to more categories.
OFAC also decided to restrict imports of diamond jewelry and unsorted diamonds originating in or exported from Russia, effective March 1.
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Anthony Rapa, who co-chairs the international trade practice group at Blank Rome LLP, said the diamond restrictions mirror sanctions the U.S. imposed on Russian seafood in December. The inclusion of third-country processing is important, he said.
"The takeaway, which is kind of similar to what I would describe as the takeaway for the seafood, is that it really makes supply chain diligence very important," Rapa said, adding that the additional need for compliance will probably "cascade through the supply chain."
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"U.S. Targets Price Cap Evaders, Bans Russian Diamonds," by Micah Danney was published in Law360 on February 8, 2024.