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  March 8th, 2016 | Written by

CGG Services Settles Civil Liability for Alleged Violations of the Cuba Embargo

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  • U.S. relations with Cuba may have been relaxed but the embargo regulations remain in place.
  • CGG settled with OFAC for $614,250 in a case where the maximum penalty was $2,340,000.
  • OFAC found CGG acted with reckless disregard for U.S. Cuba sanctions requirements.

CGG Services S.A. has agreed to pay $614,250 to settle potential civil liability for alleged violations of the Cuban Assets Control Regulations.

The company and its affiliates provide services, spare parts, and equipment for oil and gas exploration and seismic surveys.

United States relations, including economic ties, with Cuba may have been relaxed of late, but the case illustrates that the embargo regulations remain in place.

On December 14, 2010, CGG may to have violated the regulations when it exported spare parts and other equipment from the United States to M/V Amadeus while the vessel operated in Cuba’s territorial waters. The same activity occurred in March 2011, with the respect to the vessel M/V Veritas Vantage.

From February 2011 to July 2011, CGG exported U.S.-origin goods to the vessel M/V Veritas Vantage

on 13 occasions while the vessel operated in Cuba’s territorial waters.

Between September 2010 and February 2011, a CGG subsidiary allegedly violated regulations when it processed data from seismic surveys conducted in Cuba’s Exclusive Economic Zone benefiting a Cuban company.

The Office of Foreign Assets Control (OFAC) of the U.S. Department of the Treasury determined that CGG did not voluntarily self-disclose the alleged violations to OFAC, and that the alleged violations constitute a non-egregious case. The statutory maximum civil monetary penalty amount for the alleged violations was $2,340,000 and the base penalty amount was $975,000.

The settlement amount reflects OFAC’s consideration of facts and circumstances, such as: CGG and its subsidiary acted with reckless disregard for U.S. sanctions requirements; CGG’s U.S. affiliate informed the parent company that its exports could be a violation of U.S. sanctions; CGG was aware of the location of the vessels and the origin of the goods; CGG had not been the subject of a penalty or violation notice in the five years preceding the incidents; CGG has adjusted its supply procedures to minimize the risk of future sanctions violations; and CGG cooperated with the investigation.