On October 31, 2023, the United States Department of the Treasury’s Office of Foreign Assets Control (OFAC) issued a new directive that stands to deeply impact the financial relationship between U.S. entities and Myanmar Oil and Gas Enterprise (MOGE). Announced through Directive 1 under Executive Order 14014, the decree, that would come into effect on December 15, 2023, is set to prohibit U.S. persons from exporting or reexporting, either directly or indirectly, any financial services to this Myanmar-based company. This notable shift in policy has left legal professionals working in multinational corporations and large law firms analyzing implications and possible aftereffects.
This comprehensive ban encompasses an array of financial services such as loans, funds transfers, accounts, insurance, investments, which are provided to or for the benefit of MOGE. This suggests a potentially significant contraction of financial interactions between U.S. individuals or firms and this specific oil and gas power player in Myanmar. Even though the complete scope of this directive’s impact is still to be fully realized, it is certain to induce some degree of recalibration in ongoing operations involving the aforementioned parties.
It is crucial for legal players in the financial field who engage with international markets, particularly those involved in transactions with Myanmar-based enterprises, to stay updated about the specifics of this directive in order to revise their legal strategies as necessary.
For further information on this impending directive and its potential consequences, refer to the full legal update article: OFAC Myanmar Sanctions Update, published by Locke Lord LLP.