… and Alfa Laval’s lessons to be learned

Non-U.S. companies should be aware of how their activities might trigger compliance issues with U.S. sanctions, including when they place orders with U.S. affiliates or subsidiaries. This is especially true for companies operating in multiple countries as part of a larger global business organization, and particularly those with connections to both the United States and sanctioned jurisdictions. Because maintaining such links can give rise to an increased risk of violating U.S. sanctions, foreign companies should also implement appropriate measures to mitigate their risks.
For example, global business organizations should ensure that subsidiaries and affiliates are trained on U.S. sanctions requirements, can effectively identify red flags, and are empowered to report prohibited conduct to management. By empowering employees to identify and report prohibited conduct, global business organizations may be able to prevent the formation of—and better detect— conspiracies intended to undermine U.S. sanctions. Conspiracies to violate U.S. sanctions laws are particularly harmful because multiple people in a transaction work in concert to undermine compliance controls, and as a result, economic sanctions. Empowering and educating the broader workforce on sanctions compliance may neutralize or mitigate these risks.