Blocking the Property of Persons Involved in Serious Human Rights Abuse or Corruption

Overview

Aims and Objectives

Executive Order 13818, titled "Blocking the Property of Persons Involved in Serious Human Rights Abuse or Corruption," was issued by President Donald Trump on December 20, 2017. The order builds upon the Global Magnitsky Human Rights Accountability Act and seeks to address international human rights violations and corruption. This order enhances the U.S. government’s ability to impose sanctions on foreign individuals and entities involved in serious human rights abuses or corruption, marking a significant tactical shift in foreign policy and national security strategy.

Scope and Mechanism

The executive order authorizes the blocking of property and interests in property within the United States of individuals listed in the annex or subsequently identified by the Secretary of the Treasury. By freezing assets and restricting entry into the U.S., it aims to cut off financial routes and physical access, hence deterring individuals from engaging in activities undermining fundamental global democratic principles. The order signals a strong stance by the U.S. to leverage its economic and political influence to support human rights worldwide.

Global Context

This order recognizes the transnational nature of the targeted issues, categorizing them as threats to U.S. national security, foreign policy, and the economy. It emphasizes America’s commitment to its democratic values globally, aiming to bolster international political and economic systems’ stability. Consequently, the executive order is likely to impact diplomatic relations, signaling U.S. intentions to hold foreign officials and other actors accountable for international misconduct.

Legal and Policy Implications

Statutory Foundations

Executive Order 13818 derives its authority from multiple statutory sources, including the International Emergency Economic Powers Act (IEEPA), the National Emergencies Act (NEA), and the Global Magnitsky Human Rights Accountability Act. These laws provide the president with wide-ranging powers to regulate commerce after declaring a national emergency, justify severe economic sanctions, and extend further executive action when substantial threats are identified.

Enhanced Presidential Powers

With this executive order, the president declared national emergencies to justify broad economic measures against individuals involved in severe human rights abuses or corruption. This declaration grants the executive branch expanded powers to enforce asset freezes and travel bans without needing congressional approval. The order underscores the executive branch’s extensive powers in sanctioning actions implicating foreign nationals.

Regulatory Changes

The order necessitated new regulations and coordination between the Departments of the Treasury, State, and Justice. These government agencies must draft, implement, and enforce rules under the order’s provision. The Treasury, being the principal actor, is tasked with identifying and designating individuals subject to sanctions, thereby emphasizing the cross-departmental collaboration crucial for the order’s success.

Policy Shift

As a continuation of the Global Magnitsky Act political philosophy, the order’s approach signals a pivot from traditional diplomatic dialogs to more punitive measures targeting individuals. This shift aims to hold foreign individuals accountable individually rather than imposing sweeping sanctions that might affect entire nations or populations, aligning with targeted sanctions strategies.

Judicial Interpretation

Because of its reliance on several legal enactments, the order could undergo judicial scrutiny. Courts could be tasked with interpreting its application when challenged, particularly when dealing with constitutionality arguments centered on due process rights, thus presenting potential challenges in broader judicial processes.

Who Benefits

Victims of Human Rights Abuses

The primary beneficiaries of this executive order are primarily the victims of human rights abuses, as the order expressly aims to hold offenders accountable and cut off resources for future violations. This symbolic stance provides hope and potential legal recourse for those affected by such abuses, empowering victims' voices around the globe.

Global Institutions

Organizations focused on promoting global human rights and fighting corruption benefit significantly. The executive order provides a supplementary enforcement tool supporting the work of international institutions tasked with addressing these global issues, enhancing their efforts through additional U.S. sanctions.

U.S. National Security Interests

Protection against global corruption and abuse aligns with U.S. national security interests. By reducing the avenues for such individuals to access U.S. financial and economic systems, the order indirectly protects the U.S. from the impact these abuses might have on its own markets and political stability.

Reputation Management

The U.S. itself stands to benefit reputationally, as this order underscores its commitment to standing against human rights abuses and corruption. It reinforces American ideological exports on democracy and economic systems’ integrity, potentially improving diplomatic and strategic alliances.

Legal Industry

Law firms and entities specializing in international law might also benefit from the order, which can lead to increased demand for services related to compliance, advisory, and litigation involving sanctions and foreign policy measures.

Who Suffers

Perpetrators of Human Rights Abuses and Corruption

The individuals and entities directly implicated by this order are the most adversely affected, facing asset freezes and travel bans. These measures directly interrupt personal finances and movement freedoms, significantly impacting activities that rely on international access and financial transactions.

Political Entities Involved

Government officials or politicians involved in or abetting corruption and human rights abuses specifically suffer, as their association with and participation in such activities could lead to international reputational damage affecting their standing and relationships globally.

Countries with Weak Governance

Countries where governance is weak and such abuses or corruption are rampant might face difficulties in diplomatic and international trade engagements, particularly if the order exacerbates tensions with U.S. policies and operations, potentially complicating economic relationships.

Intermediary Financial Institutions

Financial institutions implicated in enabling these actors—whether knowingly or unknowingly—face reputational and regulatory risks. Compliance becomes increasingly stringent, and institutions may incur significant costs to avoid inadvertently violating the executive order.

Legal and Trade Implications

There can be wider industry disruptions, as companies considering international expansion may find new legal and trade barriers, particularly if partners or markets are associated with blacklisted individuals or activities.

Historical Context

Precedent and Legislation

Executive Order 13818 is grounded in historical precedent, particularly the Global Magnitsky Act passed in 2016. The order extends past domestic sanctions aimed at holding foreign officials accountable for human rights abuses. This legal framework underscores a continued U.S. emphasis on enforcing global human rights through punitive economic measures.

Continuation of Global Policy Trends

The order aligns with broader international trends toward individual accountability for human rights violations and corruption. Post-Cold War developments have increasingly focused on economic sanctions targeting individuals rather than nation-states, emphasizing personal liability in global governance.

Trump Administration Ideology

President Trump’s administration leaned toward a foreign policy that prioritized America’s broader geopolitical influence while holding individuals accountable using economic tools. Though often criticized for its isolationist tendencies, measures like this order highlighted selective engagement based on economic and moral grounds.

Shift in Economic Diplomacy

This order reflects a shift from traditional diplomatic engagement to more coercive economic diplomacy. By directly targeting individuals, the U.S. uses its influential economic position to act against behaviors seen as violating fundamental global norms, demonstrating a pragmatic and morally justified approach internationally.

Previous Administrative Sanctions

Past U.S. administrations have similarly employed executive orders to enforce human rights standards and combat corruption, but Executive Order 13818 is notable for broadening criteria based on the Global Magnitsky Act. This alignment with historical political stances testifies to bipartisan support for human rights and corruption accountability.

Potential Controversies or Challenges

International Pushback

Executive orders of this nature often provoke international backlash, particularly from countries or entities targeted or criticized, potentially leading to diplomatic disputes or retaliatory measures. This raises concerns of escalation in international tensions and political standoffs involving U.S. criticism.

Judicial and Constitutional Challenges

Although the order is heavily rooted in congressional acts and precedents, it may still face judicial challenges. Questions surrounding individuals' rights under U.S. law could manifest, especially concerning due process rights or potentially extraterritorial applications.

Enforcement Concerns

Enforcing the order’s provisions across a complex web of global financial systems, overlapping jurisdictions, and sectors makes comprehensive implementation challenging. Ensuring compliance across various institutions without overstepping jurisdictional boundaries presents potential legal and operational hurdles.

Economic Concerns for Institutions

Financial institutions face economic implications regarding compliance efforts, including increased regulatory scrutiny to ensure that they are not inadvertently engaged in prohibited transactions. This scrutiny can be costly and lead to unintended consequences for legitimate transactions and economic activities.

Legislative Perspective

Congressional pushback, while limited due to bi-partisan support for anti-corruption measures, could still arise concerning the balance of powers. Legislators concerned with executive overreach might scrutinize the scope of authorities exercised under the claim of national emergencies and consider legislative measures to refine or constrain such powers.