On March 9, 2015, President Obama issued a new Executive Order instructing the freezing of the assets and the denial of entry into the United States of seven officials of the Venezuelan government. U.S. persons, including U.S. citizens, permanent residents, and companies, are prohibited from engaging in any transactions with the designated officials, and must freeze any property belonging to the designated persons if it comes under their control. The order applies by operation of law to any property, including companies, owned 50 percent or more by these persons, either individually or taken together. The Order also authorizes the Secretary of the Treasury to designate additional persons as being subject to sanctions if the Secretary determines that they have engaged in the suppression of democracy or the violation of human rights in Venezuela.

The immediate impact of the Executive Order is relatively limited, as it applies only to the seven individuals designated as Specially Designated Nationals. However, the order raises the possibility that the Secretary could designate additional Venezuelan government officials and other persons, as well as any entities they own or control. U.S. persons doing business with officials of the Venezuelan government, especially those associated with defense or law enforcement, should be aware of the possibility that such officials, and any entities they own or control, could be subject to future designation as SDNs. It remains to be seen whether this new Executive Order will result in a broad extension of sanctions to Venezuela, but such an extension cannot be discounted.