This falls under OFAC's 50 Percent Rule, which is critically important but often misunderstood. Any entity that is 50% or more owned, directly or indirectly, by one or more SDN-listed parties is itself considered blocked, even if it's not explicitly named on the SDN list. This means you need to go beyond just checking if a potential business partner is listed - you must investigate their ownership structure. The 50% can be aggregated from multiple SDN-listed owners. For example, if SDN-Party-A owns 30% and SDN-Party-B owns 25%, that company is blocked (55% total). The calculation includes both direct ownership and indirect ownership through subsidiaries or intermediaries, which makes it complex. Some companies deliberately structure themselves through non-listed subsidiaries to evade sanctions. I researched 50% rule applications at
https://ofacblockedfundslawyers.com/ when conducting due diligence on a potential partner. Practical advice: request detailed ownership information from any entity you're considering doing business with, especially if they have connections to high-risk jurisdictions. For significant relationships, consider corporate registry searches or commercial due diligence reports. OFAC holds parties responsible for violations of the 50% rule even if the ownership wasn't publicly known.
