CSS Secondary Sanctions & Extraterritorial Reach

Question 1

What is the primary purpose of secondary sanctions in U.S. foreign policy?

Accepted Answer

To deter non-U.S. persons from conducting business with sanctioned parties by threatening their access to U.S. markets

Answer

Secondary sanctions deter third-country actors by threatening to cut off their access to U.S. markets and financial systems if they conduct business with sanctioned parties.

Question 2

Which of the following best describes the difference between primary and secondary sanctions?

Accepted Answer

Primary sanctions prohibit U.S. persons from engaging with sanctioned parties; secondary sanctions threaten non-U.S. persons for doing the same

Answer

Primary sanctions bind U.S. persons and entities, while secondary sanctions extend U.S. reach extraterritorially to non-U.S. persons who deal with sanctioned parties.

Question 3

The Countering America's Adversaries Through Sanctions Act (CAATSA) primarily targets which three countries?

Accepted Answer

Russia, Iran, and North Korea

Answer

CAATSA, enacted in 2017, established mandatory and discretionary secondary sanctions targeting Russia, Iran, and North Korea.

Question 4

Under CAATSA Section 231, a foreign person may face sanctions if they knowingly engage in a 'significant transaction' with which sector?

Accepted Answer

Russia's defense or intelligence sectors

Answer

CAATSA Section 231 authorizes the President to impose sanctions on foreign persons who knowingly engage in significant transactions with Russia's defense or intelligence sectors.

Question 5

Which of the following would most likely trigger a secondary sanctions designation for a non-U.S. financial institution?

Accepted Answer

Providing significant financial services to an OFAC-designated party

Answer

A non-U.S. financial institution providing significant financial services to OFAC-designated parties risks being cut off from the U.S. financial system under secondary sanctions.

(CSS) Certified Sanctions Specialist Practice Test

(CSS) Certified Sanctions Specialist Practice Test

CSS Secondary Sanctions & Extraterritorial Reach