Clyde & Co Update – New US Sanctions Against North Korea

On January 2, 2015, President Obama issued an Executive Order (EO) imposing new sanctions against North Korea. According to a Treasury Department press release, the sanctions were issued in response to the North Korean government’s “numerous provocations, particularly the recent cyber-attack targeting Sony Pictures Entertainment and the threats against movie theaters and moviegoers.”

The EO bans US citizens and companies from dealing with, and requires them to block the property and interests in property of, any person determined to be an official of the North Korean government, an official of the Workers’ Party of Korea, or an agency, instrumentality, or controlled entity of either. The EO also bans US persons from dealing with and requires them to block the property and interests in property of any person determined:

to have materially assisted, sponsored, or provided financial, material, or technological support for, or goods or services to or in support of, the Government of North Korea or any person whose property and interests in property are blocked pursuant to the [EO].

Thus, anyone who provides financial support or goods or services to the North Korean government could be exposed to sanctions under the EO.

Concurrent with release of the EO, ten individuals and three entities were designated for sanctions. The newly designated entities include (1) the Reconnaissance General Bureau, North Korea’s primary intelligence organization, (2) Korea Mining Development Trading Corporation, North Korea’s primary arms dealer, and (3) Korea Tangun Trading Corporation, which has primary responsibility for the procurement of commodities and technologies to support North Korea’s defense research and development programs.