The Office of Foreign Assets Control (“OFAC”) has taken another step in polishing off the economic sanctions against Burma by issuing General License 18 which authorizes most imports from Burma. This action was no doubt timed to coincide with the presidential visit to Burma which just took place.

Under the General License, all imports of items from Burma are now permitted, with two exceptions. First, the license prohibits import of any items from persons whose assets are still blocked under the Burma sanctions. A number of individuals associated with the Burmese military dictatorship are still blocked. Second, the new license does not authorize the import of rubies or jadeite mined in Burma or articles of jewelry containing rubies or jadeite mined in Burma.

If it seems odd that OFAC would leave in place the import ban on rubies and jadeite while permitting all other imports, it is odd, but OFAC had little discretion here. The ban on rubies and jadeite is mandated by the Tom Lantos Block Burmese JADE (Junta’s Anti-Democratic Efforts) Act of 2008, so OFAC has no discretion here without Congressional authorization. Don’t hold your breath that Congress will get around to recognizing that things in Burma have changed and that the Lantos Act no longer serves any real purpose.

A second obstacle to Burmese imports also complicates matters somewhat. On November 18, 2003, the Secretary of the Treasury designated Burma as a jurisdiction of primary money laundering concern; and then, on April 12, 2004, applied a “special measure” against Burma under Section 311 of the USA PATRIOT Act. That special measure prohibits any U.S. financial institution from maintaining a correspondent account for any Burmese bank, which will certainly complicate paying for imports from Burma. There is an exception in the special measure for correspondent accounts only used for permitted activities, which may ameliorate the situation somewhat, but banks may be justifiably hesitant to worry about whether correspondent accounts satisfy this requirement and may not permit accounts that would otherwise be permissible under this exception.

[Thanks to Rudyard Kipling, via the Cowardly Lion, more of less, for the title!]

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