---
kind: "section"
citation: "31 C.F.R. § 850.303"
title: "31"
number: "850.303"
heading: "Knowingly directing an otherwise prohibited transaction."
url: "https://uscodex.org/cfr/31/850.303"
---

# §850.303. Knowingly directing an otherwise prohibited transaction.

- (a) A U.S. person is prohibited from knowingly directing a transaction by a non-U.S. person that the U.S. person knows at the time of the transaction would be a prohibited transaction if engaged in by a U.S. person. For purposes of this section, a U.S. person “knowingly directs” a transaction when the U.S. person has authority, individually or as part of a group, to make or substantially participate in decisions on behalf of a non-U.S. person, and exercises that authority to direct, order, decide upon, or approve a transaction. Such authority exists when a U.S. person is an officer, director, or otherwise possesses executive responsibilities at a non-U.S. person.
- (b) A U.S. person that has the authority described in [paragraph (a)](#a) of this section and recuses themself from each of the following activities will not be considered to have exercised their authority to direct, order, decide upon, or approve a transaction:
  - (1) Participating in formal approval and decision-making processes related to the transaction, including making a recommendation;
  - (2) Reviewing, editing, commenting on, approving, and signing relevant transaction documents; and
  - (3) Engaging in negotiations with the investment target (or, as applicable, the relevant transaction counterparty, such as a joint venture partner).

## Notes

### Authority

Authority: 50 U.S.C. 1701 et seq.; E.O. 14105, 88 FR 54867, 31 U.S.C. 321.

### Source

Source: 89 FR 90462, Nov. 15, 2024, unless otherwise noted.