Alert
Alert
07.12.12
The United States implemented the long-anticipated reform of its sanctions program for Burma (also known as Myanmar) on July 11, 2012. General Licenses 16 and 17 were added to the Burmese Sanctions Regulations, 31 CFR Part 537, allowing previously prohibited financial transactions involving Burma and new investment in all sectors (including natural resources), subject to certain restrictions. However, in a ground-breaking approach, the United States is implementing a public reporting regime for investments over $500,000 to promote transparency and encourage responsible business conduct. Many parts of the U.S. sanctions regime for Burma remain in place, including restrictions on transactions with specially designated nationals (SDNs) and the Burmese military. Imports to the United States from Burma are still prohibited and "Special Measures" relating to banks for anti-money laundering purposes continue, although they do not apply to transactions authorized by the general license permitting exports of financial services. Thus, while these reforms present new opportunities for U.S. and multinational companies, a complicated sanctions regime and new reporting requirements remain in place and companies should proceed cautiously.
Following a number of signs that Burma may be entering a new era, the United States has now joined the European Union, United Kingdom, Canada and Australia in reforming its sanctions regime for the long-isolated Southeast Asian nation. Recognizing that reforms are at a "fragile" stage, the Obama Administration and Congressional leaders from both parties developed a consensus to reform U.S. Burma sanctions on a step-by-step basis. Since Secretary of State Hillary Clinton’s May 17, 2012 announcement that the United States would pursue reform, the Administration has attempted to strike a balance between geopolitical, economic and human-rights interests in establishing the specific elements of this reform. The delay in implementing the U.S. reforms had confused many observers unfamiliar with the process.