OFAC publishes Burma Directive 1 in Federal Register: prohibits US persons from providing financial services to or for benefit of Myanma Oil and Gas Enterprise (MOGE)

Mechanism

Directive 1 is a sectoral, entity-specific financial-services prohibition issued under sections 1(a)(iv), 1(b) and 8 of Executive Order 14014 ("Blocking Property With Respect to the Situation in Burma," 10 February 2021). The operative determination has two layers:

1. Section 1(a)(iv) determination — MOGE as a GoB instrumentality. OFAC determined that the Myanma Oil and Gas Enterprise (MOGE) is "a political subdivision, agency, or instrumentality of the Government of Burma." This is the predicate finding that pulls MOGE inside EO 14014's blocking perimeter without requiring an SDN-list designation of MOGE itself.

2. Section 1(b)/8 implementing directive. Pursuant to that determination, U.S. persons are prohibited from providing, exporting, or reexporting, directly or indirectly, financial services to or for the benefit of MOGE, or to or for the benefit of MOGE's property and interests in property. The prohibition reaches financial intermediaries facing MOGE: USD-clearing banks, payment-services providers, insurance carriers, and financial counterparties to MOGE's joint-venture partners on the financial-services leg.

The Directive is not a full asset-blocking action against MOGE (MOGE is not added to the SDN List). It is a financial-services-only sectoral prohibition — narrower than SDN blocking but broader than a single-transaction licensing requirement. The structure parallels the Russia-program "Directive" architecture under EO 14024 (which uses similar sectoral financial-services prohibitions instead of full blocking).

Sequence of dates:

• 2023-10-31 — Directive issued by OFAC and published on the OFAC website.
• 2023-12-15 — Directive's effective date (45-day wind-down window built into the

determination to allow counterparties to exit existing financial-services exposures).

• 2024-04-18 — Publication of the Directive in the Federal Register (FR Doc

2024-08366; 89 FR 27286). The Federal Register notice is procedural codification — the underlying prohibition has been operative for ~4 months at the point of FR publication.

The Federal Register publication itself does not create new perimeter; it formalises notice for record-keeping and judicial-review purposes (consistent with OFAC's standard practice of issuing directives via the OFAC website and publishing them in the FR thereafter, sometimes months later).

Downstream implications

• MOGE financial isolation. MOGE is the single largest source of foreign-currency

revenue for the State Administration Council (SAC) junta. The financial-services prohibition is designed to deny MOGE access to U.S. financial intermediation — USD-clearing, trade-finance, project-finance, insurance — without imposing the collateral damage of a full SDN blocking on MOGE's joint-venture partners (TotalEnergies, Chevron exited prior; PTTEP, POSCO International, ONGC Videsh remain operationally).

• Knock-on for JV partners. Foreign partners in Yadana, Yetagun, Zawtika and Shwe

gas projects retain operational freedom but lose access to U.S.-touched financial services on MOGE-facing transactions — pushing settlements toward non-USD rails (RMB, THB, KRW), which compresses MOGE's effective USD price and is the operative pressure channel.

• Civil-society advocacy benchmark. Advocacy groups (Justice For Myanmar, EarthRights

International) had pressed for full MOGE SDN designation since 2021; Directive 1 represents a partial half-measure designed by Treasury to avoid LNG-supply disruption to Thailand (PTT) while still pressuring junta foreign-exchange earnings. The FR publication formalises this calibrated approach.

• Banking-sector compliance lift. U.S. correspondent banks must now screen MOGE

references in counterparty transactions even where MOGE is not a direct party — a compliance burden parallel to the EO 14024 Russia directives' "for the benefit of" language.

Open questions

• Whether OFAC will expand the Directive 1 perimeter to other GoB instrumentalities

(Myanmar Foreign Trade Bank, Myanma Investment and Commercial Bank — already SDN-listed since 2022) or to ancillary natural-gas/minerals SOEs (No. 1 Mining Enterprise, Myanmar Pearl Enterprise).

• Whether the EU and UK will mirror the Directive's structure — both jurisdictions have

declined full MOGE asset-freeze designations to date but face mirror civil-society pressure.

• Whether the 2024-08-21 Burma humanitarian general license (31 CFR 525.512) and Directive

1 together signal a longer-term Burma-program rebuild — i.e., perimeter expansion paired with humanitarian carve-outs on the standing post-2022 OFAC template.