31 C.F.R. Subpart E—Licenses, Authorizations, and Statements of Licensing Policy
Title 31 - Money and Finance: Treasury
For provisions relating to licensing procedures, see part 501, subpart E, of this chapter. Licensing actions pursuant to part 501 of this chapter with respect to the prohibitions of this part are considered actions pursuant to this part. [63 FR 54576, Oct. 13, 1998, as amended at 66 FR 50509, Oct. 3, 2001; 68 FR 53659, Sept. 11, 2003] (a) No license or other authorization contained in this part, or otherwise issued by or under the direction of the Director of the Office of Foreign Assets Control pursuant to this part, authorizes or validates any transaction effected prior to the issuance of the license, unless specifically so provided in such license or authorization. (b) No regulation, ruling, instruction, or license authorizes any transaction prohibited under this part unless the regulation, ruling, instruction, or license is issued by the Office of Foreign Assets Control and specifically refers to this part. No regulation, ruling, instruction, or license referring to this part authorizes any transaction prohibited by any provision of this chapter unless the regulation, ruling, instruction or license specifically refers to such provision. (c) Any regulation, ruling, instruction, or license authorizing any transaction otherwise prohibited under this part has the effect of removing a prohibition or prohibitions contained in this part from the transaction, but only to the extent specifically stated by its terms. Unless the regulation, ruling, instruction, or license otherwise specifies, such an authorization does not create any right, duty, obligation, claim, or interest in, or with respect to, any property which would not otherwise exist under ordinary principles of law. Note to paragraph (d) Any general license or statement of licensing policy contained in this part authorizing transactions with respect to the Government of the FRY (S&M) shall, unless otherwise stated, also authorize analogous transactions with respect to the Governments or territories of the Republic of Serbia and the Republic of Montenegro. The Director of the Office of Foreign Assets Control reserves the right to exclude any person, property, or transaction from the operation of any license, or from the privileges therein conferred, or to restrict the applicability thereof with respect to particular persons, property, transactions, or classes thereof. Such action is binding upon all persons receiving actual or constructive notice of such exclusion or restriction. Any payment of funds or transfer of credit in which any person whose property and interests in property are blocked pursuant to §586.201 has any interest, that comes within the possession or control of a U.S. financial institution, must be blocked in an account on the books of that financial institution. A transfer of funds or credit by a U.S. financial institution between blocked accounts in its branches or offices is authorized, provided that no transfer is made from an account within the United States to an account held outside the United States, and further provided that a transfer from a blocked account may only be made to another blocked account held in the same name. Note to §586.504: Please refer to §501.603 of this chapter for mandatory reporting requirements regarding financial transfers. See also §586.203 concerning the obligation to hold blocked funds in interest-bearing accounts.
Title 31: Money and Finance: Treasury
PART 586—FEDERAL REPUBLIC OF YUGOSLAVIA (SERBIA & MONTENEGRO) KOSOVO SANCTIONS REGULATIONS
Subpart E—Licenses, Authorizations, and Statements of Licensing Policy
§ 586.501 General and specific licensing procedures.
§ 586.502 Effect of license or authorization.
§ 586.503 Exclusion from licenses and authorizations.
§ 586.504 Payments and transfers to blocked accounts in U.S. financial institutions.
§ 586.505 Payment of obligations to U.S. persons authorized.
(a) The transfer of funds after the effective date by, through, or to any U.S. financial institution or other U.S. person not blocked pursuant to this chapter solely for the purpose of payment of obligations to U.S. persons of persons whose property or interests in property are blocked pursuant to §586.201 is authorized, provided that the obligation arose prior to the effective date or is otherwise authorized pursuant to statute or the provisions of this part, and the payment requires no debit to a blocked account. Property is not blocked by virtue of being transferred or received pursuant to this section.
(b) A person receiving payment under this section may distribute all or part of that payment to any person, provided that any such payment to a person whose property or interests in property are blocked pursuant to §586.201 must be to a blocked account in a U.S. financial institution.
Note to §586.505: Please refer to §501.603 of this chapter for mandatory reporting requirements regarding financial transfers. See also §586.203 concerning the obligation to hold blocked funds in interest-bearing accounts.
§ 586.506 Investment and reinvestment of certain funds.
U.S. financial institutions are authorized to invest and reinvest assets blocked pursuant to §586.201, subject to the following conditions:
(a) The assets representing such investments and reinvestments are credited to a blocked account or subaccount which is held in the same name at the same U.S. financial institution, or within the possession or control of a U.S. person, but in no case may funds be transferred outside the United States for this purpose; and
(b) The proceeds of such investments and reinvestments are not credited to a blocked account or subaccount under any name or designation which differs from the name or designation of the specific blocked account or subaccount in which such funds or securities were held; and
(c) No immediate financial or economic benefit accrues (e.g., through pledging or other use) to any person whose property or interests in property are blocked pursuant to §586.201.
§ 586.507 Completion of certain transactions related to bankers acceptances authorized.
Persons other than those whose property or interests in property are blocked pursuant to §586.201 are authorized to buy, sell, and satisfy obligations with respect to bankers acceptances, and to pay under deferred payment undertakings, involving a property interest blocked pursuant to §586.201, as long as the bankers acceptances were created or the deferred payment undertakings were incurred prior to the effective date.
§ 586.508 Entries in certain accounts for normal service charges authorized.
(a) U.S. financial institutions are hereby authorized to debit any blocked account with such U.S. financial institution in payment or reimbursement for normal service charges owed to such U.S. financial institution by the owner of such blocked account.
(b) As used in this section, the term normal service charge shall include charges in payment or reimbursement for interest due; cable, telegraph, or telephone charges; postage costs; custody fees; small adjustment charges to correct bookkeeping errors; and, but not by way of limitation, minimum balance charges, notary and protest fees, and charges for reference books, photocopies, credit reports, transcripts of statements, registered mail, insurance, stationery and supplies, and other similar items.
§ 586.509 Provision of certain legal services authorized.
(a) The provision to or on behalf of a person whose property or interests in property are blocked pursuant to §586.201 of the legal services set forth in paragraph (b) of this section is authorized, provided that all receipt of payment therefor must be specifically licensed.
(b) Specific licenses may be issued, on a case-by-case basis, authorizing receipt, from unblocked sources, of payment of professional fees and reimbursement of incurred expenses for the following legal services by U.S. persons to a person whose property or interests in property are blocked pursuant to §586.201:
(1) Provision of legal advice and counseling on the requirements of and compliance with the laws of any jurisdiction within the United States, provided that such advice and counseling is not provided to facilitate transactions that would violate any of the prohibitions contained in this part;
(2) Representation of a person whose property or interests in property are blocked pursuant to §586.201 when named as a defendant in or otherwise made a party to domestic U.S. legal, arbitration, or administrative proceedings;
(3) Initiation of domestic U.S. legal, arbitration, or administrative proceedings in defense of property interests subject to U.S. jurisdiction of a person whose property or interests in property are blocked pursuant to §586.201;
(4) Representation of a person whose property and interests in property are blocked pursuant to §586.201 before any federal or state agency with respect to the imposition, administration, or enforcement of U.S. sanctions against such person; and
(5) Provision of legal services in any other context in which prevailing U.S. law requires access to legal counsel at public expense.
(c) The provision of any other legal services to a person whose property or interests in property are blocked pursuant to §586.201, not otherwise authorized in or exempted by this part, requires the issuance of a specific license.
(d) Entry into a settlement agreement affecting property or interests in property of a person whose property or interests in property are blocked pursuant to §586.201 or the enforcement of any lien, judgment, arbitral award, decree, or other order through execution, garnishment or other judicial process purporting to transfer or otherwise alter or affect a property interest of such person is prohibited unless specifically licensed in accordance with §586.202(e).
§ 586.510 Transactions related to telecommunications authorized.
All transactions with respect to the receipt and transmission of telecommunications involving the FRY (S&M) are authorized. This section does not authorize the provision to any person whose property or interests in property are blocked pursuant to §586.201 of telecommunications equipment or technology, nor the sale or leasing of telecommunications transmission facilities (such as satellite links or dedicated lines).
§ 586.511 Transactions related to mail authorized.
All transactions by U.S. persons, including payment and transfers to common carriers, incident to the receipt or transmission of mail between the United States and the FRY (S&M) are authorized, provided that mail is limited to personal communications not involving a transfer of anything of value.
§ 586.512 Certain transactions related to patents, trademarks and copyrights authorized.
(a) All of the following transactions in connection with patent, trademark, copyright or other intellectual property protection in the United States or the FRY (S&M) are authorized:
(1) The filing and prosecution of any application to obtain a patent, trademark, copyright or other form of intellectual property protection;
(2) The receipt of a patent, trademark, copyright or other form of intellectual property protection;
(3) The renewal or maintenance of a patent, trademark, copyright or other form of intellectual property protection; and
(4) The filing and prosecution of opposition or infringement proceedings with respect to a patent, trademark, copyright or other form of intellectual property protection, or the entrance of a defense to any such proceedings.
(b) This section authorizes the payment of fees currently due to the United States Government, or of the reasonable and customary fees and charges currently due to attorneys or representatives within the United States, in connection with the transactions authorized in paragraph (a) of this section. Payment effected pursuant to the terms of this paragraph (b) may not be made from a blocked account.
(c) This section authorizes the payment of fees currently due to the Government of the FRY (S&M), or of the reasonable and customary fees and charges currently due to attorneys or representatives within the territory of the FRY (S&M), in connection with the transactions authorized in paragraph (a) of this section.
(d) Nothing in this section affects obligations under any other provision of law.
§ 586.513 Certain transactions with respect to trade with blocked persons authorized.
(a) U.S. persons may trade in goods in which a person whose property and interests in property are blocked pursuant to §586.201 has an interest, provided that the payment for the goods is made in bank notes and coins of any currency or by barter. Any open account credit terms may not exceed 30 days. Transactions relating to services incident to this trade in goods, including payment for shipping and insurance to non-blocked entities, are authorized.
(b) Example: A U.S. company located outside of Serbia may ship goods to Serbia in exchange for bank notes and coins or under a barter arrangement in exchange for Serbian goods, exchanged directly with the U.S. company or assigned to a third company in satisfaction of an obligation owed that party by the U.S. company. Except as provided in §586.408 or otherwise specifically authorized, however, the U.S. company may not establish or use an account at a financial institution within the territory of the Republic of Serbia in connection with any trade transaction described in this section.
§ 586.514 Divestiture of U.S. person's equity investment in the territory of the Republic of Serbia.
Notwithstanding the prohibition in §586.204 against the facilitation by a U.S. person of other persons' new investment in the territory of the Republic of Serbia, all transactions related to the divestiture or transfer to a non-U.S. person, other than a person whose property or property interests are blocked pursuant to §586.201 or this chapter, of a U.S. person's investment in the Republic of Serbia are authorized.
§ 586.515 Payments for services rendered by the Government of the FRY (S&M) to aircraft authorized; aircraft and maritime safety.
(a) Payments to the Government of the FRY (S&M) of charges for services rendered by that Government in connection with the overflight of the territory of the FRY (S&M) or emergency landing in the FRY (S&M) by aircraft are authorized.
(b) Specific licenses may be issued on a case-by-case basis for the exportation and reexportation of goods, services, and technology to insure the safety of civil aviation and safe operation of U.S.-origin commercial passenger aircraft, and to ensure the safety of ocean-going maritime traffic in international waters.
§ 586.516 Transactions with respect to property in which the Government of the Republic of Montenegro has an interest authorized.
All transactions by U.S. persons involving property or interests in property in which the Government of the Republic of Montenegro has an interest are authorized, except with respect to property blocked pursuant to the Federal Republic of Yugoslavia (Serbia and Montenegro) and Bosnian Serb-Controlled Areas of the Republic of Bosnia and Herzegovina Sanctions Regulations, 31 CFR part 585 (see §585.525). Property and interests in property of the Government of Montenegro shall not be considered “property and interests in property blocked pursuant to §586.201” for purposes of this part. This authorization does not apply, however, to property in which the Government of Montenegro has an interest but in which there also exists an interest of another person whose property or interests in property are blocked pursuant to §586.201 or any other part of this chapter.
§ 586.517 Unblocking of certain debt.
(a) Subject to the limitations in paragraph (c) below, debt obligations in the possession or control of U.S. persons for which the National Bank of Yugoslavia has joint or several liability and that were rescheduled pursuant to the “New Financing Agreement” of September 20, 1988, are unblocked.
(b) Specific licenses may be issued on a case-by-case basis to permit the unblocking of debt obligations not otherwise authorized under either paragraph (a) of this section or 31 CFR 585.509.
(c) Nothing in this section authorizes transactions with any person designated in or pursuant to 31 CFR 587.201(a).
[66 FR 50509, Oct. 3, 2001]
§ 586.518 Authorization of release of certain blocked transfers by U.S. financial institutions.
(a) Subject to the limitation set forth in this paragraph, U.S. financial institutions are authorized to unblock and return to the remitting party funds blocked pursuant to this part that came into their possession or control through wire transfer instructions or check remittances, provided those funds were not destined for an account established on the books of a U.S. financial institution by a person whose property or interests in property were blocked immediately prior to January 19, 2001. Funds otherwise eligible for release under this general license, however, may not be unblocked and returned if they were remitted by or destined for a person designated in or pursuant to 31 CFR 587.201(a).
(b) Funds blocked pursuant to this part that were destined through wire transfer instructions or check remittances for an account established on the books of a U.S. financial institution by a person whose property or interests in property were blocked immediately prior to January 19, 2001, remain blocked. If such funds are not already held in the account for which they were destined, they must be transferred to such an account by October 15, 2001, and maintained in blocked status pursuant to §586.201(c).
[66 FR 50509, Oct. 3, 2001]
§ 586.519 Release of certain funds held at overseas branches of U.S. financial institutions.
Specific licenses may be issued on a case-by-case basis to permit the overseas branches of U.S. financial institutions to unblock deposit accounts that were blocked pursuant to this part prior to January 19, 2001, and that were established outside of the United States in situations in which such accounts are not owned or controlled, directly or indirectly, by any person designated in or pursuant to 31 CFR §587.201(a).
[66 FR 50510, Oct. 3, 2001]
§ 586.520 Unblocking of previously blocked property.
(a)(1) Except for such property and interests in property set forth in paragraph (a)(2) of this section, as of February 25, 2003, all transactions that otherwise would be prohibited by this part involving property or interests in property blocked pursuant to Executive Order 13088 of June 9, 1998, or Executive Order 13121 of April 30, 1999, that has remained blocked pursuant to Executive Order 13192 of January 17, 2001, are authorized.
(2) The authorization in paragraph (a)(1) does not apply to property or interests in property blocked pursuant to this part of those persons presently subject to sanctions under either the Federal Republic of Yugoslavia (Serbia & Montenegro) Milosevic Regulations set forth at 31 CFR part 587 or the Western Balkans Transactions Regulations set forth at 31 CFR part 588, or who are otherwise subject to sanctions under this chapter.
(b)(1) As of December 27, 2002, any person or government is authorized to seek an attachment, judgment, decree, lien, or other judicial or legal process against or with respect to any property or interests in property subject to the unblocking authorization set forth in paragraph (a) of this section. This section does not authorize any execution against, final settlement with respect to, garnishment of, or other action effecting the transfer of any property or interests in property subject to the unblocking authorization set forth in paragraph (a) of this section prior to February 25, 2003.
Note to paragraph
[67 FR 78974, Dec. 27, 2002]
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