United States: US Announces New Nicaragua Sanctions

On November 27, 2018, President Donald Trump issued Executive Order 13851 (EO 13851), creating a new US sanctions authority targeting the government of Nicaragua and individuals and entities engaged in Nicaragua in human rights abuses, threatening the peace, security, or stability of the country, or deceptive practices or corruption. At the same time, the US Treasury Department's Office of Foreign Assets Control (OFAC) imposed sanctions under EO 13851 against the Vice President and First Lady of Nicaragua, Rosario Maria Murillo De Ortega, and the National Security Advisor to the Nicaraguan President and Vice President, Nestor Moncada Lau. US Persons1 may not engage in transactions with Ms. Murillo and Mr. Moncada, and are required to block (freeze) any property or interests in property of Ms. Murillo and Mr. Moncada within their possession or control.

These new Nicaragua-related sanctions add to the growing roster of US sanctions authorities. They do not impose a comprehensive embargo on Nicaragua, but they do significantly raise the risks of doing business with or involving current or former Nicaraguan government officials, in particular, and the entities they own or control.

The new Nicaraguan sanctions authorities also demonstrate, once again, that the US is increasingly using sanctions programs to target corruption - giving the US authorities yet more tools, even beyond the criminal justice system. The Nicaraguan sanctions authorities come in the wake of the Global Magnitsky Human Rights Accountability Act (Global Magnitsky Sanctions), enacted in 2016, which allows the US to sanction corrupt actors globally,2 and Section 227 of the Countering America's Adversaries Through Sanctions Act, enacted in 2017, which requires sanctions on persons engaging in significant corruption in Russia.

New US sanctions target human rights abuses, corruption, and actions that undermine democracy in Nicaragua

EO 13851 authorizes blocking sanctions and restrictions on travel to the US on any person determined by the Secretary of Treasury, in consultation with the Secretary of State:

  1. To be responsible for or engaged in (1) serious human rights abuses in Nicaragua, (2) actions or policies that threaten the peace, security, or stability of Nicaragua, or (3) transactions involving deceptive practices or corruption on behalf or related to the Government of Nicaragua (e.g., misappropriation of public assets);
  2. To be a leader or official of an entity that has engaged in any of the aforementioned activities; or
  3. To be an official of the Government of Nicaragua or to have served as an official of the Government of Nicaragua at any time on or after January 10, 2007.

Additionally, EO 13851 authorizes the same sanctions measures against any individual or entity determined to have provided material assistance for sanctionable activities or to parties sanctioned under this executive order. It also imposes sanctions on any person determined to be owned or controlled by a sanctioned person or to have acted or purported to act on behalf of a sanctioned person. 

Blocking sanctions freeze (block) all property and interests in property of the sanctioned person within US possession or control.  OFAC maintains a list of blocked persons, who it refers to as "Specially Designated Nationals" (SDNs). As described above, US Persons3 generally may not engage in any transaction with blocked persons/SDNs absent authorization or licensure from OFAC. These restrictions also apply to any entity owned 50 percent or more by a designated person, even if the owned entity is not named itself on the SDN list.

First sanctions against Nicaraguan officials

The US imposed the first set of sanctions under EO 13851 against two prominent Nicaraguan officials and close associates of Nicaraguan President Daniel Ortega: his wife (the Vice President) and their shared national security advisor. According to a press release issued by OFAC, Ms. Murillo was designated under EO 13851 for being an official of the Government of Nicaragua on or after January 10, 2007. Ms. Murillo was elected Vice President of Nicaragua in 2016, and OFAC describes her as being the de-facto co-president of Nicaragua since 2007. She is also the First Lady of Nicaragua. The second official, Mr. Moncada, OFAC described as a national security advisor to the President and Vice President. OFAC designated him for acting for or on behalf of Vice President Murillo.4

Looking ahead

The Trump Administration has pledged that it will "continue to add pressure on the Ortega regime and its supporters, using all the economic and diplomatic tools at our disposal."5 Although there are no indications yet that additional sanctions under EO 13851 are imminent, administration officials have also signaled a tough approach toward Nicaragua. For example, US National Security Advisor John Bolton recently declared that Nicaragua was part of a "troika of tyranny" with Cuba and Venezuela.6 Bolton said that the "Nicaraguan regime, like Venezuela and Cuba, will feel the full weight of America's robust sanctions regime."7 Accordingly, individuals and businesses with interests in Nicaragua should monitor developments closely, as the sweeping authorities established by EO 13851 and the policy of the Trump Administration suggest that additional sanctions may be possible.


  1. US Person means any US citizen, permanent resident alien, entity organized under the laws of the United States or any jurisdiction within the United States (including foreign branches), or any person in the United States. Exec. Order 13851 (Nov. 27, 2018).
  2. In July 2018, the US sanctioned Jose Francisco Lopez Centeno, the President of the Nicaraguan state-owned oil company Petronic, for corruption-related activities under Global Magnitsky Sanctions.
  3. US Person means any US citizen, permanent resident alien, entity organized under the laws of the United States or any jurisdiction within the United States (including foreign branches), or any person in the United States. Exec. Order 13851 (Nov. 27, 2018).
  4. Treasury Targets Nicaraguan Vice President and Key Advisor over Violent Response to Protests, US Department of the Treasury (Nov. 27, 2018), https://home.treasury.gov/news/press-releases/sm554
  5. President Donald J. Trump is Pressuring the Nicaraguan Regime to Restore Democracy and the Rule of Law, The White House (Nov. 27, 2018), https://www.whitehouse.gov/briefings-statements/president-donald-j-trump-pressuring-nicaraguan-regime-restore-democracy-rule-law/
  6. Assistant to the President and National Security Advisor Ambassador John R. Bolton Delivers Remarks on the Trump Administration's Policies in Latin America at Miami Dade College, US Embassy in Cuba (Nov. 1, 2018), https://cu.usembassy.gov/assistant-to-the-president-and-national-security-advisor-ambassador-john-r-bolton-delivers-remarks-on-the-trump-administrations-policies-in-latin-am/
  7. Id.

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