On February 25, 2011, President Obama signed an Executive Order effectively Blocking Property Transfers and Prohibiting Certain Transactions related to Libya. Those businesses or persons having or seeking to have any business, financial or other relationships with the Government of Libya or any persons or entities connected with Libya should review the following prior to making any decisions or undertaking any transactions with Libya or its government.
President Obama’s Executive Order freezes all property or interests in property of the Government of Libya, including but not limited to its agencies, instrumentalities and controlled entities wherever located now and/or in the future. It also orders a freeze of assets without prior notice for certain individuals affiliated, related or otherwise acting, directly or indirectly, on behalf of the government of Libya and its instrumentalities.
President Obama’s Executive Order prohibits any transactions by US persons (whether individuals and/or entities) or persons located within the US that avoid or evade, are intended to avoid or evade, violate or intended to violate any of the prohibitions set forth in this order.
As of this time, the U.S. Treasury Department has frozen at least US $30 billion in assets controlled by Libyan leader Gadaffi and his family, which is largest single seizure of foreign funds in American history. It is believed that the central bank of Libya has over $100 billion in foreign-currency reserves world-wide, while the sovereign-wealth fund holds more than $70 billion.
The European Union has taken similar measures with regard to the freezing of assets, instituting a visa ban and implementing an arms embargo.
On February 26, 2011, the United Nations Security Council (UNSC) took a bold step and adopted a Resolution to address the current situation on Libya. This UNSC Resolution was passed with a 15-0 vote, showing a unified stance from all members of the Council. Within the powers of Chapter VII of the Charter of the UN, the February 26th Resolution imposed certain measures, which are unique and straightforward in their combination, including the following:
- Arms embargo and any other related activity, effective immediately;
- Travel ban on certain individuals from Libyan Government and others related or associated with the current Libyan regime and/or these individuals;
- Asset freeze of certain individuals related or associated with the current Libyan Government and/or these individuals; and
- Referral of the situation in Libya to the Prosecutor General of the International Criminal Court.
Effectively immediately on March 2, 2011, the United Nations General Assembly unanimously voted to suspend Libya as a member of its Human Rights Council. The vote by the General Assembly marks the first time in history of the UN that a country has been suspended by the General Assembly.