The United States currently maintains comprehensive sanctions against Cuba, Iran, North Korea, Sudan, and Syria. While the sanctions vary from country to country, a common exemption from export controls exists for certain types of information and informational materials. This exception (the so-called "Berman Amendment") has been vital for the spread of publications in sanctioned countries both in written form and via the Internet. The Treasury Department’s Office of Foreign Assets Control ("OFAC") recently expanded the scope of the Berman Amendment to support the publication and marketing of manuscripts, books, journals, and newspapers, in paper or electronic format.

Although the Berman Amendment does not define the term "information and informational materials," it does contain an illustrative list of permitted materials, including: publications, films, posters, phonograph records, photographs, microfilms, microfiche, tapes, compact disks, CD ROMS, artworks, and newswire feeds. Such informational materials are exempt from any sanctions program whether commercial or otherwise, and regardless of format or medium of transmission.

The expressed desire of the U.S. government to spread information and informational materials to sanctioned countries has regularly come into conflict with the process of preparing such publications. Most notably, OFAC interpreted the exception as only extending to finished works; any changes or enhancements by a U.S. person, no matter how minor, prior to publication potentially represented an illegal export of services. Therefore, on December 17, 2004, OFAC issued a new general license (the "License") for Cuba, Sudan, and Iran allowing for the following publishing activities:

  • Commissioning and making advance payments for identifiable written publications not yet in existence, to the extent consistent with industry practice;
  • Collaborating on the creation and enhancement of written publications;
  • Augmenting written publications through the addition of items such as photographs, artwork translation, and explanatory text;
  • Substantive editing of written publications;
  • Payment of royalties for written publications;
  • Creating or undertaking a marketing campaign to promote a written publication; and
  • Other transactions necessary and ordinarily incident to the publishing of written publications.

While clearly facilitating the publication of information pursuant to the Berman Amendment, the License does not authorize all publishing activities intended for sanctioned countries. Specifically, the License does not apply if a party to the transaction is a sanctioned country’s government or political subdivision, agency, or instrumentality thereof. A U.S. person further cannot provide or receive individualized or customized services (including, but not limited to, accounting, legal, design, or consulting services) other than those necessary and ordinarily incident to the publishing and marketing of written publications. The License does not authorize U.S. persons to engage the services of publishing houses or translators in a sanctioned country, unless such activity is primarily for the dissemination of written publications in that country. Finally, the License does not authorize transactions for the development, design, or marketing of software, nor any export of information subject to the licensing requirements under the Export Administration Regulations ("EAR") or the International Traffic in Arms Regulations ("ITAR").

The new License should facilitate the dissemination of printed materials to the above-mentioned sanctioned countries. The fact that the Berman Amendment now authorizes editing, translating, and other publishing-related services also has direct relevance for the Internet, where documents are often revised by discussion groups and distributed worldwide without regard to U.S. sanctions. OFAC generally has not interfered with information transmitted over the Internet as long as the U.S. website does not facilitate actual transactions with sanctioned countries or set up a vehicle for such purposes.

Therefore, the License provides important clarification as to what sort of collaborative Internet publications are permitted under the Berman Amendment. At the same time, it must be emphasized that a company’s website remains subject to U.S. export controls, and OFAC seems to be constantly re-examining the question of what constitutes unlawful facilitation to sanctioned countries over the Internet. The Reed Smith Export, Customs, and Trade team can review a company’s website to ensure that it has not crossed the "information" divide and introduced an operational component that implicates U.S. sanctions.

This article is presented for informational purposes only and is not intended to constitute legal advice.