[Code of Federal Regulations]
[Title 31, Volume 2]
[Revised as of July 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 31CFR538.506]

[Page 695-696]
 
                  TITLE 31--MONEY AND FINANCE: TREASURY
 
 CHAPTER V--OFFICE OF FOREIGN ASSETS CONTROL, DEPARTMENT OF THE TREASURY
 
PART 538--SUDANESE SANCTIONS REGULATIONS--Table of Contents
 
 Subpart E--Licenses, Authorizations, and Statements of Licensing Policy
 
Sec. 538.506  30-day delayed effective date for pre-November 4, 1997 trade contracts involving Sudan.

    (a) Pre-existing trade contracts. Trade transactions required under 
a contract entered into prior to November 4, 1997 (a ``pre-existing 
trade contract''), otherwise prohibited by this part, including the 
importation of goods or services of Sudanese origin or the exportation 
of goods, services, or technology that was authorized under applicable 
Federal regulations in force immediately prior to November 4, 1997, are 
authorized without specific licensing by the Office of Foreign Assets 
Control as follows:
    (1) Exports or reexports are authorized until 12:01 a.m. EST, 
December 4, 1997, and non-financing activity by U.S. persons incidental 
to the performance of the pre-existing trade contract (such as the 
provision of transportation or insurance) is authorized through 12:01 
a.m. EST, February 2, 1998, if the pre-existing trade contract is for:
    (i) The exportation of goods, services, or technology from the 
United States

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or a third country that was authorized under applicable Federal 
regulations in force immediately prior to November 4, 1997; or
    (ii) The reexportation of goods or technology that was authorized 
under applicable Federal regulations in force immediately prior to 
November 4, 1997.
    (2) If the pre-existing trade contract is for the importation of 
goods or services of Sudanese origin or other trade transactions 
relating to goods or services of Sudanese origin or owned or controlled 
by the Government of Sudan, importations under the pre-existing trade 
contract are authorized until 12:01 a.m. EST, December 4, 1997.
    (3) For purposes of this section, goods are considered to be 
exported upon final loading aboard the exporting conveyance in the 
country of export. Goods are considered to be imported upon arrival in 
the jurisdiction of the country of importation.
    (b)(1) Financing for pre-existing trade contracts. In general, no 
financing services prohibited by this part may be performed after 12:01 
a.m. EST, November 4, 1997. However, letters of credit and other 
financing agreements with respect to the trade transactions authorized 
in paragraph (a) of this section may be performed according to their 
terms, and may be extended or renewed, except that:
    (i) Any payment required to be made to the Government of Sudan or 
any person blocked pursuant to this part or otherwise, including 
payments authorized with respect to trade transactions described in 
paragraph (a) of this section, must be made into a blocked account in 
the United States; and
    (ii) No payment may be made from a blocked account unless authorized 
by a specific license issued by the Office of Foreign Assets Controls.
    (2) Specific licenses may be issued by the Office of Foreign Asset 
Controls on a case-by-case basis to permit a U.S. bank to debit a 
blocked account of the Government of Sudan for funds held as collateral 
under an irrevocable letter of credit issued or confirmed by it, or a 
letter of credit reimbursement confirmed by it, for goods, services or 
technology exported, or goods or technology reexported, prior to 12:01 
a.m. EST, December 4, 1997, directly or indirectly to Sudan, or to third 
countries for an entity operated from Sudan, or for the benefit of the 
Government of Sudan. The application for a license must:
    (i) Present evidence satisfactory to the Office of Foreign Asset 
Controls that the exportation or reexportation occurred prior to 12:01 
a.m. EST, December 4, 1997; and
    (ii) Include an explanation of the facts and circumstances 
surrounding the entry and execution of the export or reexport 
transaction, including the names and addresses of all Sudanese 
participants in the transaction and all Sudanese persons having an 
ownership interest in the beneficiary of the letter of credit.
    (c) Blocked Government of Sudan accounts. Nothing in this section 
permits debits to a blocked account of the Government of Sudan absent 
the issuance of a specific license by Office of Foreign Asset Controls 
authorizing such a debit. The operation of an account of the Government 
of Sudan in a financial institution does not constitute a trade 
transaction for purposes of this section.
    (d) Existence of contract. The existence of a contract will be 
determined with reference to the principles contained in Article 2 of 
the Uniform Commercial Code.
    (e) Reporting requirement. Although a specific license from Office 
of Foreign Asset Controls is not required for any transaction authorized 
in paragraph (a) of this section, any U.S. person engaging in a 
transaction described in paragraph (a) of this section is required to 
report such transaction immediately to the Office of Foreign Asset 
Controls and provide a description of the underlying trade contract. 
Such reports should be directed to the Office of Foreign Assets Control, 
Attn: Compliance Programs Division/Sudan Contracts, 1500 Pennsylvania 
Avenue, NW., Annex-2nd Floor, Washington, DC 20220. Such reports may be 
made by facsimile transmission to 202/622-1657.
    (f) Licensing and reporting provisions. For provisions relating to 
applications to the Office of Foreign Asset Controls for specific 
licenses and reporting requirements, see Secs. 501.606 and 501.808 of 
this chapter.

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