European Sanctions Update

 

Halliburton subsidiary agrees OFAC penalty for Cuba violations

 

 

Halliburton Atlantic Limited (HAL) has agreed to pay $304,706 to settle its potential liability for violations of US sanctions on Cuba.  The violations related to transactions worth $1,189,752, with a base penalty of $423,202 and a maximum of $1,235,000.

Between February and April 2011, HAL and its affiliate Halliburton Overseas Limited (HOL), both subsidiaries of US company Halliburton Energy Services, are said to have violated US sanctions by dealing in property in which Cuba or a Cuban national had an interest.  The violations occurred when HAL and HOL exported goods and services for use by a consortium in oil and gas exploration within the Cabinda Onshore South Block oil concession, in which Cuba Petroleo, a state-owned Cuban company, had a 5% interest through the consortium.

OFAC said the subsidiaries acted with “reckless disregard” for US sanctions, and should have known that a Cuban entity belonged to the consortium, but the violations were voluntarily disclosed and were a “non-egregious case”.  OFAC also noted, in mitigation, that Cuba Petroleo’s interest in the concession was only 5%, which limited the extent of the economic benefit provided to Cuba. OFAC’s enforcement notice