On February 16, 2021, the US Department of Treasury’s Office of Foreign Assets Control (“OFAC”) revoked the designations of Ansarallah, the Yemeni political and para-military organization also known as the Houthis, under the Global Terrorism Sanctions Regulations (“GTSR”), the Foreign Terrorist Organization Sanctions Regulations (“FTOSR”), and Executive Order 13244. As a result, US persons no longer require authorization from OFAC to conduct transactions with Ansarallah, if those transactions are not otherwise prohibited by US sanctions laws.

OFAC’s decision to de-designate Ansarallah follows a tumultuous few weeks in US policy toward Yemen.

On January 10, then-Secretary of State Michael Pompeo announced that Ansarallah would be designated as a “Foreign Terrorist Organization” and a specially designated national. This effectively prohibited US persons from dealing, directly or indirectly, with the organization when the sanctions came into effect on January 19, one day before President Biden’s inauguration.

According to Secretary Pompeo, the designations were designed to curb terrorist activity by Ansarallah, including cross-border attacks in Saudi Arabia, while enabling (through general licenses) the continued flow of humanitarian aid to Yemen. However, the United Nations and humanitarian organizations strongly criticized the designations, which they predicted would have a chilling effect on aid to the country and thereby intensify an already perilous humanitarian crisis.

Following President Biden’s inauguration, on January 25, OFAC effectively lifted the sanctions against Ansarallah by issuing a general license authorizing all transactions and activities with Ansarallah otherwise prohibited by the GTSR, FTOSR, and Executive Order 13244.

A few days later, on February 4, President Biden announced that the United States would end all support for offensive operations in the war in Yemen—a sharp break from former President Trump’s steadfast support for the Saudi Arabia-led war, despite bipartisan opposition in Congress.

Subsequently, on February 12, Secretary of State Antony Blinken announced that the United States would revoke the designations of Ansarallah, effective February 16. Secretary Blinken stated that the “decision [was] a recognition of the dire humanitarian situation in Yemen,” and acknowledged that “the designations could have a devastating impact on Yemenis’ access to basic commodities like food and fuel.”

Despite lifting these designations, Secretary Blinken stated that Ansarallah leaders Abdul Malik al-Houthi, Abd al-Khaliq Badr al-Din al-Houthi, and Abdullah Yahya al-Hakim would remain sanctioned under Executive Order 13611, and that the United States was “clear-eyed about Ansarallah’s malign actions[] and aggression.”

We will continue to monitor developments in this area. For more information, please contact the authors, or your usual Herbert Smith Freehills contacts.

Jonathan Cross
Jonathan Cross
Counsel, New York
+1 917 542 7824
Christopher Boyd
Christopher Boyd
Associate, New York
+1 917 542 7821
Brittany Crosby-Banyai
Brittany Crosby-Banyai
Associate, New York
+1 917 542 7837
Christopher Milazzo
Christopher Milazzo
Associate, New York
+1 917 542 7807