Description:

This paper analyzes the potential impact U.S. economic sanctions may have on the ability of international JOA members to both comply with sanctions and protect their interests under the JOA.1 The current AIPN Model Form International JOA (“Model Form”) does not address circumstances and issues arising from economic sanctions. As a result, a party to the JOA may face a Compliance Dilemma, where it is unable to both comply with applicable sanctions and perform its obligations under the JOA. While there may be no optimal provision with respect to protecting each party’s interest under these circumstances, this paper seeks to offer a number of pragmatic solutions.

In addition to providing an overview of economic sanctions in general, Part II of this paper describes the framework of U.S. economic sanctions. Part III discusses the Model Form and its relevant provisions. Part IV focuses on the Compliance Dilemma and demonstrates how the Model Form currently does not protect each party’s interest from the issues arising from economic sanctions.2 Part V provides an overview of how the Model Form could adapt to protect the parties’ interests from the issues arising from economic sanctions.