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    GOI vs. Blocked Bank What's The Difference

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    Erich Ferrari
    This document discusses the difference between banks designated as Government of Iran (GOI) entities by the US Treasury Department and blocked banks. Banks with a GOI designation have prohibitions extended to them wherever they operate due to their placement on the Specially Designated Nationals List. While transactions with these banks would be rejected by US banks, the funds would not be blocked and placed in an interest-bearing account like they would be for true blocked banks. The document provides an example to illustrate this distinction and notes it is important when transferring funds from Iran to the US.

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    Download as PDF, TXT or read online from Scribd

    GOI vs. Blocked Bank What's The Difference

    Uploaded by

    Erich Ferrari
    52 views1 page
    This document discusses the difference between banks designated as Government of Iran (GOI) entities by the US Treasury Department and blocked banks. Banks with a GOI designation have prohibitions extended to them wherever they operate due to their placement on the Specially Designated Nationals List. While transactions with these banks would be rejected by US banks, the funds would not be blocked and placed in an interest-bearing account like they would be for true blocked banks. The document provides an example to illustrate this distinction and notes it is important when transferring funds from Iran to the US.

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    Article on distinctions between Government of Iran designation vs. OFAC blocking designation

    Original Title

    GOI vs. Blocked Bank What's the Difference

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    This document discusses the difference between banks designated as Government of Iran (GOI) entities by the US Treasury Department and blocked banks. Banks with a GOI designation have prohibitions extended to them wherever they operate due to their placement on the Specially Designated Nationals List. While transactions with these banks would be rejected by US banks, the funds would not be blocked and placed in an interest-bearing account like they would be for true blocked banks. The document provides an example to illustrate this distinction and notes it is important when transferring funds from Iran to the US.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    52 views1 page

    GOI vs. Blocked Bank What's The Difference

    Uploaded by

    Erich Ferrari
    This document discusses the difference between banks designated as Government of Iran (GOI) entities by the US Treasury Department and blocked banks. Banks with a GOI designation have prohibitions extended to them wherever they operate due to their placement on the Specially Designated Nationals List. While transactions with these banks would be rejected by US banks, the funds would not be blocked and placed in an interest-bearing account like they would be for true blocked banks. The document provides an example to illustrate this distinction and notes it is important when transferring funds from Iran to the US.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 1

    1455 Pennsylvania Ave.

    , NW
    Suite 400
    Washington, DC 20004
    Tel. 202-280-6370
    Fax. 877-448-4885

    GOI vs. Blocked Bank: What's the Difference?


    June 7, 2011

    Recently the question was raised as to whether certain banks in Iran are blocked due to their
    placement on the Specially Designated Nationals List maintained by the United States Department of
    the Treasury Office of Foreign Assets Control ("OFAC"). The banks being referred to are designated
    as [IRAN] which denotes a designation pursuant to the Iranian Transactions Regulations ("ITR") as
    a Government of Iran ("GOI") entity. The ITR does not contain any blocking provisions and
    therefore a designation under the ITR does not amount to a blocking as it is thought of in the
    traditional sense.

    What the ITR designation does to these banks is extend the prohibitions found in the ITR to
    those banks wherever they operate (i.e., outside of Iran). Therefore, a U.S. person would be
    prohibited from engaging in the importation of services from an [IRAN] designated bank; from
    exporting goods, services or technology to such bank; from engaging in a trade transactions with
    such bank; and from facilitation of transactions with such bank, regardless of whether that bank
    operates in Iran or not.

    Well that sounds a lot like the bank is blocked doesn't it? Not necessarily. The easiest way to
    understand the distinction is by example and a perfect example is found in OFAC's Frequently Asked
    Questions(FAQs) section. In that section OFAC offers the following example:

    "A U.S. bank interdicts a commercial payment destined for the account of the French
    Computer Corporation at Bank Tejarat, in Paris on the books of a U.S. bank. The beneficiary’s
    address confirms that it’s a company in France. However, this payment must be rejected by the
    U.S. bank because the account of Bank Tejarat is an “Iranian account” on the books of a U.S. bank
    and cannot be operated."

    Had Bank Tejarat been a blocked bank then the transaction would have been blocked by the
    U.S. bank and the funds would have been placed into an interest bearing account until such time
    when the funds could be released by the bank.

    Therefore if an unauthorized transfer of funds is coming from an [IRAN] designated bank,


    such as Bank Tejarat to the United States it will be rejected, as opposed to blocked. This is an
    important distinction to keep in mind, particularly when transferring funds from Iran to the United
    States pursuant to an exemption or an OFAC general license.

    The author of this article is Erich Ferrari, an attorney specializing in OFAC matters. If you have any
    questions please contact him at 202-280-6370 or [email protected].

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