OFAC Issues GL, FAQs Related to Chinese Military Companies
The Office of Foreign Assets Control on Jan. 14 issued a new general license and several new frequently asked questions to provide guidance on President Donald Trump’s November executive order to ban U.S. investment in Chinese military companies (see 2011130026). General License No. 2 authorizes certain transactions and activities involving publicly traded securities of certain entities on OFAC’s Chinese military companies list (see 2012290017). Transactions with companies added to OFAC’s list after 12:01 a.m. EST Jan. 14 are authorized through 12:01 a.m. Eastern time on the date that is 365 days after the date the entity was added to OFAC’s list.
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FAQ 871 describes the authorization in the general license. In FAQ 872, OFAC clarified that U.S. people and companies are still required to divest their holdings in securities belonging to the companies covered by Trump’s order. OFAC said it will define the term transactions as “the purchase for value, or sale, of any publicly traded security,” FAQ 873 said. FAQ 874 details the types of activities that constitute a divestment.