Russia
March 02, 2020

New Compliance Program Leads to U.S. Delisting of Russian Oil Company

By Samuel Rubenfeld

A Russian company and its subsidiary were removed from the U.S. sanctions list after the parent firm ceased export activities and instituted a global compliance program, the U.S. Treasury Department said Monday.

Independent Petroleum Company (IPC) and AO NNK-Primornefteproduct (NNK-P) were sanctioned on June 1, 2017, for shipping more than USD 1 million of petroleum products to North Korea. U.S. and international sanctions prohibit the shipment of petroleum to Pyongyang.

IPC’s parent company, Alliance Oil Company (AOC), launched the corporate compliance program and ended the export activity following the designation, according to the Treasury. 

“U.S. sanctions need not be permanent; sanctions are intended to bring about a positive change of behavior,” the Treasury said in a statement. “The U.S. has made clear that the removal of sanctions is available for persons designated under North Korea-related authorities, who take concrete and meaningful actions to stop enabling North Korea’s sanctions circumvention.”

The Treasury has stressed corporate compliance in its enforcement of sanctions, and in May 2019 issued guidance laying out what it said were the basic elements of a sanctions compliance program. AOC and NNK-P haven’t commented as of this writing; IPC’s website is down. 

IPC’s activity with North Korea-affiliated entities has led to subsequent sanctions designations. The company attempted to strike an oil deal worth more than USD 1 million with Taiwanese citizen Tsang Yung Yuan and his Marshall Islands-based Kingly Won International Co., Ltd., the Treasury said in February 2018. Taiwan-based Pro-Gain Group Corporation, a second company owned by Tsang, received diesel fuel from IPC, according to shipping data. 

Megi Hakobjanyan contributed to this report.

 

 

Kharon research

Log in for access to the latest updates and analysis on networks targeted by sanctions and sanctions-related risk. Don’t have an account? Click REQUEST AN ACCOUNT to receive information on how to get signed up.

Request an account or Log in