Sanctions - Chapter 18 - Navigating Maritime Arbitration: The Experts Speak - Second Edition
Originally from Navigating Maritime Arbitration: The Experts Speak - Second Edition
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The issuance of governmental sanctions has increased exponentially over the last few decades as a means of deterring conduct and influencing actions of the entities subject to those sanctions. Sanctions issued recently against Russia and Venezuela are the most newsworthy, but hardly the only, prohibitions on trade that have been issued by nations or economic unions. As a result of the increase in these trade restrictions, parties to maritime contracts have been required to increase their vigilance as to the activities of their counterparties, failing which they might unwittingly become involved in sanctionable activity and thereby fall subject to sanctions themselves. This chapter discusses the impact of sanctions on a party’s ability to perform under a maritime contract, the few instances in which sanctions have been addressed in New York maritime arbitration, and avenues by which a savvy maritime industry participant may lessen the likelihood that it might become embroiled in such a controversy.
A. U.S. Government Sanctions
The United States has addressed foreign policy issues with sanctions for over 200 years. Before the War of 1812, the United States imposed sanctions against Great Britain as a result of actions taken by the British Navy against American sailors. Similarly, Congress passed legislation during the Civil War which prohibited transactions with the Confederacy, the penalty for which was the forfeiture of goods involved in such transactions, and which established a licensing process related to such transactions.