Overview of US sanctions against Belarus

The US sanctions policy in relation to Belarus is implemented via a number of executive orders and regulations. The main documents regulating sanction measures include executive orders of the President of the United States, acts of the US Congress and relevant regulations drafted by the Office of Foreign Assets Control (OFAC). These legal instruments serve to block the assets and restrict the activities of individuals and entities that support the regime in Belarus.

Executive Order No. 13405 dated 19 June 2006[1] (Order No. 13405) was the first major step taken by the US to introduce sanctions against Belarus. Its objective was to impede the activities of persons who, in the view of the US regulator, posed a threat to Belarus’s democratic institutions. The order blocks US-based property belonging to high-placed officials and companies connected with the Government of Belarus.

Executive Order No. 14038 dated 9 August 2021[2] (Order No. 14038) was issued in response to what OFAC perceived as the worsening political and economic situation in Belarus following the 2020 elections. It introduces sanctions against certain individuals and entities deemed by OFAC to be implicated in the deterioration of the domestic climate in Belarus. As a result, property which such persons have in the US is blocked, and American citizens are prohibited from having any financial dealings with them. This document significantly broadens the range of individuals and companies covered by the sanctions, affecting a wider range of participants in the Belarusian economy and political system.

Directive No. 1 dated 2 December 2021[3] was issued in accordance with Order No. 14038. It prohibits all transactions in, provision of financing for, and other dealings in new debt with a maturity of greater than 90 days issued on or after 2 December 2021 by the Ministry of Finance of the Republic of Belarus or the Development Bank of the Republic of Belarus.

Code of Federal Regulations, 31 CFR Part 548 “Belarus Sanctions Regulations”[4] regulates the application of sanctions under laws and regulations governing US sanctions policy in relation to Belarus. The provisions of CFR 31 Part 548 deal with the mechanisms for blocking assets and financial resources of individuals and entities included in sanctions lists, as well as bans on the conduct of business and financial operations with them. The rules cover the mechanisms around asset freezes and bans on the opening of accounts, the conclusion of transactions and the provision of financial services to sanctioned persons. The OFAC sees the main purpose of the measures as being to restrict Belarus’s access to international financial resources and help stabilize the political situation in Belarus.

Sanctions with the most serious implications for blocked persons are usually referred to as personal (blocking) sanctions since, unlike sectoral sanctions (partial restrictions), blocking sanctions prohibit any activities involving the assets and resources of the blocked persons.

The US sanction regime employs a so-called “50% rule”, which means that blocking sanctions apply not only to individuals and entities specifically included in sanctions lists but also to companies that are owned 50% or more by such individuals or entities. The rule applies regardless of whether the company itself is included in the sanctions list. If a sanctioned person or group of persons owns 50% or more of a company in the aggregate, that company will automatically be subject to sanctions.

The US has included Belarusian persons in its sanctions list (SDN List) in accordance two principal presidential orders:

1. Executive Order No. 13405 formed the basis for the introduction of sanctions against individuals and entities deemed by OFAC to be involved in disrupting the political situation in Belarus. Sanctions were initially imposed on 16 individuals, including the country’s president Alexander Lukashenko, and nine government organizations. The list of sanctioned persons was subsequently extended.
2. Executive Order No. 14038 was issued in response to actions related to events that occurred after the 2020 elections, including conduct in connection with the electoral process and the incident involving the Ryanair flight. It resulted in many more individuals and entities, including state companies, being placed under sanctions.

The US sanctions list includes major political figures, government officials, businesspeople and members of the country’s elite, as well as certain organizations (including banks, electronics, defense, tobacco and logistics companies, automotive and aircraft manufacturers, shipbuilding and research institutes, and companies operating in sectors such as retail, potash and petrochemical production, energy, transportation and sport). Specifically, according to data published by OFAC[5], the US sanctions list for Belarus (encompassing various sanctions programs[6]) includes 145 individuals and 117 organizations, including the following:

• Bank Dabrabyt OJSC
• Bank BelVEB OJSC
• VTB Bank (Belarus) CJSC
• Bank Torgovy Kapital CJSC
• Belinvestbank OJSC
• Sberbank (Belarus) OJSC
• Oil Bitumen Plant Unitary Enterprise
• Lakokraska OJSC
• Belarusian Oil Trade House Unitary Enterprise
• Grodno Azot OJSC
• BTsK Holding MC State Enterprise
• BelKazTrans
• Belneftekhim Concern
• Polotsk-Steklovolokno OJSC
• SvetlogorskKhimvolokno OJSC
• AlYurTekh LLC
• Bellesumprom Concern
• Belneftegaz Additional Liability Company
• Naftan OJSC
• Aviakompaniya BELKANTO LLC
• Agrorozkvit LLC
• Aviakompaniya Belavia OJSC
• Aviakompaniya Rada LLC
• Belaruskali OJSC
• Agat Electromechanical Plant OJSC
• Energo-Oil CJSC
• Belbizneslizing CJSC
• Tekhnika Svyazi OJSC
• Legmash Plant OJSC
• NIIEVM OJSC
• Aircraft Repair Plant 558 OJSC
• KB Unmanned Helicopters LLC
• Minsk Wheel Tractor Plant OJSC
• Emirates Blue Sky LLC
• Belarusian Automobile Plant OJSC
• Tochnaya Mekhanika LLC
• Minsk Automobile Plant OJSC
• Ruchservomotor LLC
• Shock Sports Club
• Inter Tobacco LLC
• DANA HOLDINGS LIMITED (Cyprus)
• BEL-KAP-STEEL LLC (USA)
• Internal Affairs Dept of Gomel Regional Executive Committee
• Central Election Commission of RB
• Internal Troops of MVD RB
• “Alpha” Special Unit of KGB RB
• KGB RB
• Main Directorate for Combating Organized Crime and Corruption of MVD RB

The application of the sanctions regime against blocked persons based on the above-mentioned regulations entails the following consequences:

1. Freezing / blocking of assets of sanctioned persons both in the US and elsewhere. This means that all assets under US jurisdiction which are directly or indirectly owned or controlled by or connected to sanctioned persons or entities are subject to freezing orders. Any attempts to transfer, withdraw, sell or use those assets are prohibited.
2. Ban on financial dealings (prohibition of any financial or commercial dealings with sanctioned persons, including a ban on the opening and operation of bank accounts, the transfer of money and the provision of loans).

In April 2022 the US President signed an “Act Suspending Normal Trade Relations with Russia and Belarus”[7], aimed at tightening economic sanctions. Effective from 9 April 2022, it became impossible for goods to be imported from those countries at the most favored nation tariff rates which the US ordinarily applies to all WTO countries. Instead, goods from Russia and Belarus are subject to higher duties, averaging around 32.3% compared with the usual 3.3%. Belarus, which is not a WTO member, was previously accorded MFN treatment on a temporary basis.

There is a ban on the export of defense technologies and military equipment[8], including products that can be used to strengthen Belarus’s military capabilities.

There are restrictions on the export of dual use goods and technologies[9][10] which can have both civilian and military applications. The restrictions are designed to prevent such goods being used to support military activities.

Export restrictions are in place on certain kinds of goods[11][12] (electrical goods and tools, electrical devices, paper products, paints, fabrics, food industry equipment, orthopedic, ophthalmic and dental equipment, agricultural machinery, et al.).

Since 2022 restrictions have been imposed on exports of luxury items[13][14] (such as jewelry, antiques, cars and domestic appliances). 

Companies wishing to supply such goods and technologies must obtain special permits (see below).

A general license is an authorization to engage in particular activities or dealings which would currently be prohibited because of sanctions. As a rule, general licenses are issued by OFAC at the time when sanctions are imposed in order to allow existing contracts and transactions with persons included in the sanctions list to be finalized to prevent economic damage or for safety purposes (as in the case of civil aviation). Like general licenses issued under the sanction regime against Russia, such licenses are generally granted on a selective basis at the same time as sanctions are imposed on specific persons or entities. The licenses provide a limited period in which to make arrangements necessary to terminate involvement in a sanctioned entity or in transactions with such an entity. For example, the following General Licenses have been issued pursuant to the Belarusian sanction regulations:

1. General License No. 2[15] was issued on 29 October 2015 (its latest iteration with GL No. 2H was issued on 19 April 2021) to authorize the wind down of transactions involving certain blocked entities (for example, Grodno Azot OJSC, Lakokraska OJSC and Belneftekhim USA, Inc.)
2. General License No. 8[16] was issued on 9 August 2023 to authorize the wind down of transactions involving Belarusian Steel Works – Management Company of Belarusian Metallurgical Company Holding Open Joint Stock Company and entities controlled by it
3. General License No. 9[17] was also issued on 9 August 2023 and authorized transactions related to civil aviation safety or the wind down of transactions involving Belavia Open Joint Stock Company and entities controlled by it
4. General License No. 10[18] was issued on 5 December 2023 to authorize the wind down of transactions involving Tabak Invest LLC and entities controlled by it
5. General License No. 101[19] was issued on 9 August 2024 to authorize civil aviation safety and wind down transactions with Aviakompaniya Belkanto LLC, Aviakompaniya Rada LLC and RubiStar Unitary Enterprise and entities controlled by them

Specific (individual) licenses. Certain operations or transactions may be authorized in exceptional cases on the basis of specific/individual licenses issued by OFAC to US entities or citizens (for example, for the purpose of moving assets from a sanctioned bank to another bank).

Export licenses are issued by the US Department of Commerce via its Bureau of Industry and Security (BIS), which is responsible for monitoring exports of commodities, technologies and software covered by Export Administration Regulations (EAR)[20][21]. Such licenses may be requested, in particular, for the export of dual use goods and technologies and industrial equipment and technologies.