500 Million Won Frozen Due to Russia Sanctions Recovered by Law Firm

Published 01 Oct.2025 16:01(KST)

Explanation Submitted to OFAC
Payment Returned to Shipping Company in Two Months

Due to U.S. economic sanctions against Russia, funds belonging to a domestic shipping company were frozen in the United States but were returned after approximately two months with the assistance of legal counsel. Law firm Samyang successfully recovered more than 500 million won that had been unfairly seized.

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Domestic shipping company A entered into an agency service contract with Russian shipping company B, and was scheduled to pay a repair fee of 380,000 U.S. dollars (approximately 530 million won) on behalf of B to Chinese ship repair company C. However, this payment was suddenly put on hold.

It was later revealed that, under U.S. sanctions against Russia, the Office of Foreign Assets Control (OFAC) under the U.S. Department of the Treasury had decided to seize the funds. Along with the seizure, OFAC also sent an administrative subpoena to company A, requiring it to provide all information it held regarding company C and the related transaction. This seizure and information request was based on the “Ukraine/Russia-Related Sanctions Regulations (Title 31, Part 589 of the Code of Federal Regulations)” and the “Reporting, Procedures and Penalties Regulations (Title 31, Part 501, Section 602 of the Code of Federal Regulations).”

To respond to these actions, company A appointed Samyang, which has specialized expertise in the shipping sector, as its representative the day after the subpoena was issued. Samyang was given a tight deadline of 30 days. Within this period, they quickly gathered and reviewed the relevant information and submitted a 120-page “Formal Response” to the subpoena, prepared in accordance with OFAC’s required format and standards.

In the response, Samyang emphasized several points: that company A acted solely as an agent performing work according to its client’s specific instructions and did not make independent decisions; that an internal investigation found no intentional violation of U.S. sanctions regulations and that no U.S.-origin goods or services were involved in the transaction; and that company A recognizes the importance of U.S. government sanctions and intends to continue complying with the regulations in the future.

A representative from Samyang explained, “Although it was not explicitly stated in the subpoena issued by OFAC, the overall context implied that the service fee paid by company A on behalf of company B to company C would remain seized until the requested information was provided.”

Separately from the formal response, Samyang also submitted an “Application for the Release of Blocked Funds” to OFAC, a document that the party or its legal representative submits to request the lifting of government sanctions. Acting as company A’s representative, Samyang submitted a 49-page application.

Ultimately, approximately two months after submitting the response and the license application, Samyang succeeded in having the 380,000 U.S. dollars that had been frozen at the U.S. intermediary bank returned.

Hwang Guibin (6th Bar Exam), an attorney at Samyang, stated, “Since 2022, U.S. sanctions against Russia have been continuously strengthened, and there have been frequent cases where domestic companies doing business with Russian entities face various restrictions and difficulties. This case demonstrates that, even if damages occur due to connections with sanctioned entities, it is possible to escape unfair situations and minimize losses by responding quickly and logically with the help of an expert who fully understands the policies and procedures of U.S. government agencies.”