It has been brought to our attention that many individuals are routinely mistaking a “return-without-action” letter from OFAC for an OFAC license. Please be advised that a one page letter or response from OFAC is often a RWA Letter and not an actual license. This is merely a correspondence from OFAC. This IS NOT an OFAC license and will not be treated as such by your bank or by OFAC should any problems arise with the underlying transaction(s).

Furthermore, when an OFAC license is submitted to the government, OFAC will routinely issue a case number for that application for reference purposes. This is so one can easily reference the case when calling or writing to OFAC to check the status of the application and/or to submit any needed supplemental information. Once again, a case number IS NOT an OFAC license number and will not be treated as such by your bank or by OFAC.

Please be advised that this type of letter is also routinely sent in response to a license application submission in which the applicant is asking OFAC for authorization to engage in activities that are ALREADY authorized by GENERAL LICENSES, such as the receipt of Non Commercial Personal Remittances from Iran or the Sale of Property in Iran.  A “return-with-no-action” letter can also be sent if an application is missing certain information thereby preventing OFAC from being able issue a final decision.

An actual OFAC license will have a license number as well as an expiration date. It will also clearly outline the authorized activity. For a sample OFAC license, please clink the following link: Sample License

If you received a return-without-action letter and would like additional guidance regarding this matter, please feel free to contact our firm at 310-780-6360 or email us via our website’s contact page.

Because of the uncertain economic situation in Iran, many individuals who have real property in Iran would prefer to gift it to their children or other family members, including US persons, while they are still alive instead transferring title of the property as an inheritance after their passing. While this makes perfect sense if one wants to avoid possible probate and other legal issues and inheritance taxes in Iran, transferring title of real property to a US person as a gift is a violation of current US sanctions regulations.

The Office of Foreign Assets Control (OFAC) currently prohibits US persons from making any new investments in Iran without its prior authorization. Under OFAC regulations the acquisition of real property in Iran by US persons, including any type of title transfer or transfer of property, is considered a type of investment and therefore is prohibited. The only condition on which US persons can receive transfer of title to real property in Iran is if OFAC has authorized such a transaction.

OFAC does, however, authorize US persons to acquire and sell real property in Iran if they inherit that property. Moreover, according to Reg: § 560.543 of the Iranian Transactions and Sanctions Regime (ITSR) US persons may engage in transactions necessary and ordinarily incidental to the sale of real property in Iran, such as engaging the services of an attorney, funds agent, or real estate broker. US persons may also transfer the proceeds from sales of real property in Iran to the United States only if they acquired the real property before becoming a US person or inherited it from persons in Iran.

Although the inheritance of real property is permitted, OFAC does not consider a gift of real property from an Iranian national who is still living an inheritance. For this reason US persons must obtain specific authorization from OFAC (i.e. a specific OFAC license) before the transfer of title in order to legally accept the gift. Furthermore, if US persons wish to sell the property they acquire as gifts, they must again obtain another license from OFAC, as that transaction falls outside the scope of general licenses issued by OFAC.

As for other forms of property, such as vehicles, coinage, furniture, and the like, there are separate licenses that authorize US persons to receive these as gifts. And as with real property, US persons may inherit these items and transfer the proceeds from sales of them to the US, provide that they have obtained the necessary documentation attesting to the validity of the inheritance, sale, and transfer. Therefore if you are planning to accept a gift of any type of property in Iran, contact our office for more information on how to acquire the necessary OFAC license, to arrange the required documentation, and to disclose any past violations to the government.