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U.S. Treasury Lifts Sanctions on Latvian Port

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File image courtesy Ventspils Freeport Authority

By The Maritime Executive 12-19-2019 01:57:00

Within the span ten days, the U.S. Treasury imposed and then removed sanctions on the Latvian port of Ventspils, the country's second-largest port facility. 

The Department of the Treasury’s Office of Foreign Assets Control (OFAC) designated the Ventspils Freeport Authority on December 9 because it was owned or controlled by the Latvian oligarch Aivars Lembergs. Lembergs is the (now suspended) mayor of Ventspils, and Treasury designated him under the Magnitsky Act for alleged involvement in public corruption, including the misappropriation of state assets, the expropriation of private assets for personal gain, corruption related to government contracts or bribery.

After OFAC designated Lembergs and the Ventspils Freeport Authority, the Latvian government quickly passed legislation ending Lembergs’ control of the port.  According to the new law, the port will now be supervised by four representatives appointed by the Latvian government. Lembergs resigned from his post as the chairman of the Ventspils Freeport Authority on December 10. 

Treasury lifted sanctions on the port on December 18. “The U.S. applauds the Latvian government’s swift response to Lembergs’ designation. This delisting of the Ventspils Freeport Authority underscores our commitment to work closely with our partners to combat corruption,” said Treasury deputy secretary Justin G. Muzinich.

The port is now back to normal operation, according to the authority. "With the announcement from US Department of Treasury Office for Foreign Asset Control regarding abolishment of sanctions, Ventspils Freeport authority, as well as companies active at the port are able to continue their operations," said the Ventspils Freeport Authority 

In addition to leaving the board of the Ventspils port authority, Lembergs has departed his post on the Latvian Olympics Committee. He denies the U.S. Treasury's charges, calling them "fake news."

OFAC sanctions on the Ventspils Development Agency, the Business Development Association and Latvian Transit Business Association remain in place.