Sanctions – Burma/Myanmar

While there is a history of sanctions imposed against various Myanmar governmental regimes since the late 1980s, a concerted multi-state sanction initiative began in 2021 as a result of the military coup which took place on 1 February 2021 ending the rule of a democratically elected government. A state of emergency was declared by the new military leadership, initially for a period of one year but later extended to three years and six months.

After the coup, allegations arose regarding repression of peaceful demonstrations and human rights abuses, particularly of various religious and ethnic minorities, which have led to the sanction initiative. Sanctions have been placed on selected individuals and entities considered responsible for enabling the coup and for having allegedly been responsible for serious violations of human rights.

EU Sanctions

The EU government has applied a number of restrictive sanctions against the Myanmar military government through EU Regulation 2023/2789. Those restrictions include:

  • Asset freeze and prohibition of provision of funds and economic resources directly or indirectly.
  • Travel ban to EU for designated individuals.
  • Embargo on arms and military equipment and an export ban on dual-use goods for military and border guard police.
  • Prohibition of military training and cooperation with the Myanmar military.
  • Withholding of all EU financial assistance to the government and freezing of all EU assistance that may be seen as legitimizing the Junta.

UK Sanctions

Since the 2021 coup, the UK has named 25 individuals and 33 entities under its Myanmar Sanctions Regime. Most notably, it has imposed sanctions against 2 Myanmar military divisions alleged to be responsible for carrying out human rights violations and 2 state-owned enterprises claimed to be providing economic resources and support to the military. Those sanctions have taken the form of:

  • Targeting the Military’s access to finance, arms and equipment.
  • Asset freeze preventing any UK citizen or UK-based entity from dealing with any funds or economic resources owned, held or controlled by any designated persons.
  • Financial sanctions apply to all UK persons wherever they are in the world.
  • Ban on travel of all designated individuals to the UK.

US sanctions

Since the 2021 military coup, OFAC has restricted exports to, and imposed sanctions on, numerous Myanmar entities and individuals. Similarly to the EU and UK initiatives, the US sanctions employ a clinical approach focusing on entities and individuals within the military government thought to be responsible for acts of political and racial repression. Examples of these sanctions are as follows:

  • In March 2021, OFAC designated Myanmar Economic Holdings Public Company Ltd (MEHL).
  • In October 2023, the US administration imposed targeted sanctions on the Myanmar Oil & Gas Enterprise (MOGE) on the basis that it contributed substantial revenues in foreign currency to the military regime for purchase of weapons and military materials from abroad.
  • It also designated 3 entities and 5 individuals allegedly connected with the military government’s human rights violations since the February 2021 coup.
  • In January 2024 OFAC designated Shwe Byain Phyu Group of Companies (SBPG), Thein Win Zaw (person responsible for establishing SBPG to import and distribute petroleum on behalf of MEHL) and Myanma Five Star Line Co Ltd, a company owned by MEHL (alleged to have facilitated access to foreign currency for the military and to have shipped materials essential for domestic weapons production by the military government).

Consequently, Members seeking to conduct business with Myanmar are advised to exercise vigilance about:

  1. Who they are doing business with in Myanmar and whether those individuals may be designated or connected with designated entities.
  2. Checking what cargoes they are planning to ship to and/or from Myanmar to ensure that sanctions are not breached. In particular, Members should be wary of agreeing to the shipment of any commodities or items that could be used by the military government for the purposes of ethnic or political repression.

Jet fuel

As set out in our Notice to Members No.8 2023/24, on 23 August 2023 OFAC issued a determination that allows sanctions to be imposed on any foreign individual or entity that operates in the jet fuel sector of the Burmese economy by expanding Executive Order 14014 (the “EO”). The expansion of the EO by the U.S. authorities is “complementing existing provisions for sanctions against those that operate in the defence sector of the Burmese economy” (press release 23 August 2023).

OFAC also published two related Frequently Asked Questions: FAQ 1132 and FAQ.1133.

Pursuant to this Executive Order, non-U.S. persons may be sanctioned if the U.S. Government determines that they operate in the jet fuel sector of the Burmese economy or provide material support to an SDN designated under the E.O. Several individuals and entities involved in the procurement and distribution of jet fuel to Burma’s military are already designated. At the same time OFAC specified that the determination does not automatically impose sanctions on all persons who operate in the sector.

OFAC further elaborated that the jet fuel sector of the Burmese economy includes “activities related to the importation, exportation, re-exportation, sale, supply, or transport, directly or indirectly, of jet fuel in or involving Burma”.

Although it was clarified that OFAC does not intend to target persons for engaging in activities related to civil aviation, including the sale, provision, or purchase of jet fuel to or for commercial airlines for air transport to and from Burma, the OFAC FAQs indicate that: “Anyone supplying jet fuel to individuals or entities in Burma should exercise extreme caution to ensure jet fuel is provided only for use in civil aviation and not to military regime users”.

In practice, it may prove impossible for Members to obtain sufficient comfort that any jet fuel carried is only for use in civil aviation, and it is therefore highly likely that any carriage of jet fuel to Burma will trigger Clubs’ sanctions exclusions in light of the US legislation and associated FAQs.

Important note

The information provided by the Club and in particular through its website is not and is not intended to be exhaustive. Every effort is made to ensure the accuracy of the information provided. However this cannot be guaranteed given that sanctions measures are subject to alteration by Governmental organisations at short notice. Further the information on this site is not, and should not be relied upon as, independent legal advice.

Members are strongly advised to undertake due diligence before fixing any business to or from a sanctioned country in order to ensure that neither the prospective cargo nor the parties to the planned venture are sanctioned. The Club is willing to assist Members where possible but they may nevertheless wish to take independent legal advice.