America

US Updates Opposition Access to Venezuelan Funds Abroad; that changes?

US Updates Opposition Access to Venezuelan Funds Abroad;  that changes?

The US Department of the Treasury updated the license that allows US citizens to do business with the opposition National Assembly of Venezuela (IV National Assembly), commissions or delegates appointed by it, a measure that had come into effect in August 2019.

This is General License 31B issued on Monday, related to Venezuela and which refers to “certain transactions involving the IV National Assembly of Venezuela and certain other persons,” according to a release from the Office of Foreign Assets Control (OFAC) of the US Treasury.

With the regulation update, “US persons are authorized to participate in all transactions” with officials or entities designated by the opposition National Assembly.

The previous National Assembly of 2015 ceased his functions on January 5 to the deputy Juan Guaidó, who held his presidency as well as the head of the interim since January 2019.

The current license also maintains the prohibition of US entities and citizens from doing business negotiations with the National Constituent Assembly, convened by the president of Venezuela, Nicolás Maduro.

The president of the National Assembly, Dinorah Figuera, said on Monday that the new council for the protection of foreign assets of Venezuela will attend to debts with law firms abroad, while a review of pending lawsuits will also be carried out.

The country owes $20.7 million to lawyers in the United States who are prosecuting the country’s creditors seeking to collect its unpaid debts. Between October 2020 and October 2022, about 30 million dollars were canceled, according to a document seen by Reuters.

“There is the will to honor the commitments,” Figuera said at a press conference.

What are the bans, who do they affect?

US citizens are prohibited from carrying out transactions with the Government of Venezuela, with those entities with which the Maduro government directly or indirectly has a participation of up to 50% or more, explains OFAC.

This includes the Central Bank of Venezuela and Petróleos de Venezuela, SA (PdVSA). However, OFAC has extended some exemptions regarding, for example, the health and education sectors in that country.

“U.S. persons are not prohibited from carrying out transactions that involve the country or people of Venezuela, as long as they do not involve blocked persons or any conduct prohibited by any other executive order that imposes sanction measures related to the situation in Venezuela,” specifies the announcement on Monday.

What does the update mean for the IV National Assembly?

OFAC now authorizes all transactions “involving the IV National Assembly, its delegated commission,” as well as any entity established by the opposition institution.

When do sanctions against PDVSA outlaw?

The US Treasury explains that the bans will end the day PDVSA is transferred “to a democratically elected government that commits to take concrete and significant actions to combat corruption, restore democracy and respect human rights.”

Can Americans participate?

In a general sense, Americans are prohibited from entering into any transaction or agreement on debt restructuring. OFAC would consider license applications involving any new debt or equity on a case-by-case basis, and would base license determinations on the facts and circumstances of the particular application.

[Con la colaboración de Carolina Alcalde, corresponsal de la Voz de América en Caracas]

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