US unbans dealings with Venezuela's national oil corp.

WASHINGTON, Feb 2 (KUNA) -- The US Department of Treasury's Office of Foreign Assets Control (OFAC) issued on Monday General License No. 5U, authorizing certain transactions related to the Petroleos de Venezuela, S.A. 2020 8.5 Percent Bond on or After March 20, 2026.
"(a) Except as provided in paragraph (b) of this general license, on or after March 20, 2026, all transactions related to, the provision of financing for, and other dealings in the Petroleos de Venezuela, S.A. 2020 8.5 Percent Bond that would be prohibited by subsection l(a)(iii) of Executive Order (E.O.) 13835 of May 21, 2018, as amended by E.O. 13857 of January 25, 2019, and incorporated into the Venezuela Sanctions Regulations, 31 CFR part 591 (the VSR), are authorized.
"(b) This general license does not authorize any transactions or activities otherwise prohibited by the VSR, or any other part of 31 CFR chapter V," reads a statement from the Treasury.
(c) Effective February 2, 2026, General License No. 5T, dated December 19, 2025, is replaced and superseded in its entirety by this General License No. 5U, the statement added.
On May 21, 2018, US President issued Executive Order (E.O.) 13835.
The Subsection 1(a)(iii) of E.O. 13835 prohibits U.S. persons from engaging in transactions related to the sale, transfer, assignment, or pledging as collateral by the Government of Venezuela (GOV) of any equity interest in an entity owned 50 percent or more by the GOV.
One effect of subsection 1(a)(iii) is to require authorization before U.S. persons may engage in certain transactions regarding any equity interest in an entity owned 50 percent or more by the GOV. Subsequent to the issuance of E.O. 13835, OFAC received inquiries about how and whether subsection 1(a)(iii) of E.O. 13835 could affect the ability to enforce bondholder rights to the CITGO shares serving as collateral for the Petr?leos de Venezuela, S.A. (PdVSA) 2020 8.5 percent bond. On July 19, 2018, OFAC issued General License (GL) 5, which removed E.O. 13835 as an obstacle to holders of the PdVSA 2020 8.5 percent bond gaining access to their collateral. (end) rsr.gb