[Acct-Legal] Fwd: ICANN Accountability /Sanctions/Membership model

Fri Apr 17 01:12:50 UTC 2015

This was written by Greg Shatan.

On Thursday, April 16, 2015, Greg Shatan <gregshatanipc at gmail.com> wrote:

> How does this apply, assuming no dues are charged to a sanctioned member
> of a SOAC?
>
> On Thursday, April 16, 2015, List for the work of CCWG-Accountability
> Legal SubTeam <ccwg-accountability5 at icann.org
> <javascript:_e(%7B%7D,'cvml','ccwg-accountability5 at icann.org');>> wrote:
>
>> A more specific response on the OFAC question with guidance from Sidley's
>> Lisa Crosby:
>>
>> Each U.S. sanctions regime is different, but OFAC rules do generally
>> prohibit an entity located in the United States and/or organized under U.S.
>> law from offering services to, or receiving payment from, a sanctions
>> target (e.g., the government of sanctioned country, a party in a sanctioned
>> country, a Specially Designated National).  Such restrictions apply
>> regardless of whether an activity is commercial or non-commercial.
>>
>> However, OFAC regularly issues "general licenses" authorizing activities
>> that would otherwise be prohibited by its regulations.  For example, the
>> Iranian Transactions and Sanctions Regulations, the Cuban Assets Control
>> Regulations, the Sudanese Sanctions Regulations and the Syrian Sanctions
>> Regulations all authorize IP-related transactions involving countries
>> subjection to U.S. economic sanctions.  See 31 CFR 560.509 (Iran), 515.528
>> (Cuba), 538.514 (Sudan) and 542.520 (Syria).  OFAC issues such general
>> licenses when U.S. foreign policy favors activities (e.g., protection of
>> intellectual property) that would otherwise be prohibited by OFAC
>> regulations.  In sum, it should be possible to overcome the OFAC
>> restrictions if OFAC were persuaded to issue a general license authorizing
>> activities involving the reformed ICANN.
>>
>> Further, Congress has in some cases restricted the President's authority
>> to impose economic sanctions that would prohibit activity that Congress
>> feels should be exempt from U.S. economic sanctions.  For example, the
>> International Emergency Economic Powers Act (IEEPA),  50 USC 1701-1706, the
>> principal statute pursuant to which the U.S. President imposes economic
>> sanctions, states:  "The authority granted to the President by this section
>> does not include the authority to regulate or prohibit, directly or
>> indirectly--[. . .] (4) any transaction ordinarily incident to travel to or
>> from any country . . .."  Congress has limited the U.S. President's
>> authority to impose sanctions on certain activities (e.g., travel; the
>> import/export of books and movies; donations of food and medicine for
>> humanitarian purposes) that Congress feels should not be used as
>> instruments of U.S. foreign policy.  Congress could amend IEEPA or pass
>> another statute exempting activities involving the reformed ICANN from the
>> scope of U.S. economic sanctions. Exempting such activities from U.S.
>> economic sanctions by statute would eliminate the need for an OFAC general
>> license.
>>
>> Ed McNicholas
>> SIDLEY AUSTIN LLP
>>
>> -----Original Message-----
>> From: ccwg-accountability5-bounces at icann.org [mailto:
>> ccwg-accountability5-bounces at icann.org] On Behalf Of List for the work
>> of CCWG-Accountability Legal SubTeam
>> Sent: Thursday, April 16, 2015 2:30 PM
>> To: ccwg-accountability5 at icann.org
>> Subject: Re: [Acct-Legal] Fwd: ICANN Accountability /Sanctions/Membership
>> model
>>
>> I have asked one of our OFAC colleagues to write a brief response.  The
>> short answer is that OFAC restrictions do need to be respected by US-based
>> entities, but mechanisms can be created to address the issue.  More to
>> follow shortly.
>>
>> Ed
>>
>> EDWARD R. MCNICHOLAS
>> SIDLEY AUSTIN LLP
>> 1501 K Street, N.W.
>> Washington, DC 20005
>> Direct:   202.736.8010
>> emcnicholas at sidley.com
>> www.sidley.com/infolaw
>>
>> -----Original Message-----
>> From: ccwg-accountability5-bounces at icann.org [mailto:
>> ccwg-accountability5-bounces at icann.org] On Behalf Of List for the work
>> of CCWG-Accountability Legal SubTeam
>> Sent: Thursday, April 16, 2015 2:19 PM
>> To: ccwg-accountability5 at icann.org
>> Subject: Re: [Acct-Legal] Fwd: ICANN Accountability /Sanctions/Membership
>> model
>>
>> Dear Robin,
>>
>> Thanks for this question. It is indeed a great question.
>>
>> Does the OFAC deals strictly with commercial/economic affairs? How would
>> that affect non-commercial interest?
>>
>> I think this is a whole new thread to explore.
>>
>>
>> Best regards,
>>
>>
>> León
>>
>> > El 16/04/2015, a las 12:42, List for the work of CCWG-Accountability
>> Legal SubTeam <ccwg-accountability5 at icann.org> escribió:
>> >
>> > Dear Legal Sub-Team,
>> >
>> > I've received the below question from a stakeholder group member about
>> the implications of the US law, Office of Foreign Assets Control (OFAC)
>> under the Membership Model under consideration that I believe warrants an
>> answer from our legal experts.
>> >
>> > Note: OFAC acts to prevent "prohibited transactions", which are
>> considered trade or financial transactions and other dealings in which US
>> persons [such as ICANN] may not engage unless authorized by OFAC or
>> expressly exempted by statute.  OFAC enforces economic sanctions against
>> countries, businesses, or groups of individuals, using the blocking of
>> assets and trade restrictions to achieve US foreign policy and national
>> security goals.
>> >
>> > Will it be more difficult for participants in countries that are on the
>> US's naughty list (like Iran, Cuba, Syria) to be able to participate in the
>> reformed ICANN and to fully exercise equal rights given this US trade law
>> OFAC?  Will they need to apply for and obtain a special exemption from OFAC
>> in order to do so?  Does it make a difference between the two models under
>> consideration how this law will impact participation from individuals in
>> those countries?
>> >
>> > Thanks,
>> > Robin
>> >
>> > Begin forwarded message:
>> >
>> >> Dear all
>> >>
>> >> I need some clarification regarding  the designators / membership
>> models that  were introduced to enhance the accountability of ICANN.
>> >>
>> >> I have not looked into the details of these recommendations, I totally
>> understand that membership is not at individual level but I would very much
>> like to know how the intake of members by the constituencies work if we
>> were to choose one of the models or if any other model is proposed.
>> >>
>> >>
>> >> I am interested in knowing how the membership intake is regulated.
>> Will the constituencies remain autonomous in selecting their members?  If
>> the intake is also regulated as it is with associations members then it
>> might well be subject to the US sanction law that are applied to several
>> countries. Therefore those located in countries sanctioned by the US cannot
>> become members ! or it may cost alot.
>> >>
>> >> This might not even be an issue and I might be off track and ignorant
>> about this but getting an early clarification is better .
>> >>
>> >> Now you might ofcourse say that but the membership has nothing to do
>> with financial transactions (which it might have sometimes). Please don't
>> get me started. ISOC has more than once rejected the establishment of an
>> Iran ISOC chapter with a very generic answer! stating  their great reason:
>> OFAC doesnt let them ! But ofcourse that is wrong and ISOC can ask OFAC for
>> a license but they won't bother, there might be other problems as well.
>> Anyhow, ICANN has been dealing with OFAC very well so far. but I don't know
>> what will happen in the future. So an answer from someone who knows better
>> is much appreciated !
>> >>
>> >>
>> >>
>> >
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