02 Nov 2020
Economic and trade sanctions have become a top U.S. foreign-policy tool for the Trump administration, and that would be unlikely to change under his Democratic challenger, Joe Biden.
Yet, with the coronavirus pandemic and the economic fallout taking center stage of the election season, Mr. Biden hasn’t said much about his specific plans for the U.S. sanctions regime, observers said. Many are looking to the Obama administration, when Mr. Biden was vice president and the use of sanctions policies picked up, for clues.
“The assumption is that sanctions is going to be the primary foreign policy tool,” said Judith Alison Lee, a partner at law firm Gibson, Dunn & Crutcher LLP who advises companies on sanctions compliance issues. “It’s very addictive; once any administration starts to use it and they see the power of this unilateral tool and immediate implications of sanctions, it’s very difficult to restrain yourself.”
On average, the Trump administration imposed sanctions on more than 900 entities or individuals each year for the last four years, nearly 80% more than the annual number of designations imposed by the Obama administration from 2009 to 2016, according to a Wall Street Journal analysis of the data compiled by Dow Jones Risk & Compliance, which is owned by Wall Street Journal publisher Dow Jones & Co.
In 2020 alone, more than 700 entities or individuals have been added to the Office of Foreign Assets Control’s sanctions blacklist through Oct. 29, according to the data.
Trump campaign spokesman Ken Farnaso said, “There’s no question that President Trump has held foreign adversaries like Russia, China, and Cuba accountable more than any president before him, imposing debilitating sanctions and expelling rogue diplomats.”
Mr. Biden’s campaign and a spokesman for the U.S. Treasury Department’s OFAC didn’t respond to requests for comment.
Here are some areas that will be in play, based on public statements made by Mr. Biden in recent months and conversations with sanctions compliance lawyers.
The Trump administration has increased its economic pressure on Cuba, reversing the Obama administration’s shift to a more open stance toward the nation that had led to an increase in travel between the two countries.
The Trump administration has added restrictions on travel to Cuba and this week announced new rules prohibiting U.S. companies from processing remittances involving Cuban entities on the State Department’s Cuba Restricted List. President Trump in 2019 also ended the suspension of a provision of the 1996 Helms-Burton Act that allows certain U.S. nationals with claims to properties confiscated by the regime of Fidel Castro to seek compensation from companies operating on those properties.
Fewer than three dozen lawsuits have been filed under the Title III provision of Helms-Burton, according to data compiled by the U.S.-Cuba Trade and Economic Council. Both U.S. and foreign companies have been named as defendants in the lawsuits, including Amazon.com Inc., Société Générale SA and American Airlines Inc.
Sanctions lawyers expect Mr. Biden would roll back some of these restrictions on Cuba, including reimposing the waiver of the Title III provision and lifting restrictions on sending remittances, according to Cari Stinebower, a partner at law firm Winston & Strawn LLP who specializes in sanctions compliance.
The Trump administration has imposed a pressure campaign against Iran after pulling out of the 2015 nuclear deal. The administration in recent weeks imposed a volley of sanctions against Iran intended in part to fortify its campaign against any future effort to unwind it, The Wall Street Journal previously reported. On Thursday, it blacklisted Iranian and Chinese energy companies and announced forfeiture actions against shipments of Iranian missiles recently seized by the U.S. Navy.
Under a Biden presidency, the U.S. may rejoin the nuclear accord and roll back some of President Trump’s policies on Iran, according to Ms. Lee. “We do expect there to be changes to Iran, maybe not immediately,” she said.
Many expect the tensions and some of the restrictions placed on China by the Trump administration to continue even if Mr. Biden wins. The current administration has imposed sanctions on individuals for allegedly undermining Hong Kong’s autonomy and has issued warnings against doing business with companies that may be involved in human-rights violations in China.
Mr. Biden has suggested he could take a tougher stance.
“Trump opposed sanctioning China’s government over its atrocious human rights violations to protect his hollow trade deal and serve his own personal interests,” Mr. Biden said in a tweet from June 21. “Where Trump has been weak, I will be strong, clear, and consistent in standing up for America’s values and its people.”
The Trump administration has imposed sanctions on Moscow over alleged U.S. election meddling. But Mr. Biden may impose more sanctions on Russia for other issues, including over the poisoning of Kremlin critic Alexei Navalny, Ms. Lee said. The European Union has announced sanctions on members of Russian President Vladimir Putin’s inner circle in response to the poisoning. Russia has disputed the findings of European laboratories that Mr. Navalny had been poisoned by a chemical nerve agent.
Mr. Biden has signaled that he would consider issuing more sanctions on Russia over elections interference.
By Mengqi Sun, The Wall Street Journal, 30 October 2020
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