OFAC General License 52 Not a new licence… is a new framework for the U.S.–Venezuela Energy Relationship

I. No Boundaries

Since January 2026, OFAC has issued a series of general licenses progressively expanding the scope of permitted activity in Venezuela's energy sector. Each was bounded in a specific way: GL 46 addressed oil trading; GL 47, the sale of diluents; GL 48, the supply of goods and services for exploration and production; GL 49, contingent investment contracts; and GL 50/50A, broad operational authorization, but only for six named entities and their subsidiaries.

General License No. 52, issued March 18, 2026, removes many of such constraints subject to its terms and conditions. It authorizes all transactions originally prohibited by Executive Orders 13884 and 13850 involving PdVSA and any entity in which PdVSA holds, directly or indirectly, a 50% or greater interest, available to any established U.S. entity, defined as any entity organized under U.S. law on or before January 29, 2025.

No named companies. No transaction-type limitations. No sector boundaries, except as provided therein.

In a single instrument, in practical terms, OFAC seeks to extend to the entire U.S. private sector what GL 50A had reserved for a handful of named majors. The actual scope is significant: CVP (the state partner in every upstream joint venture operating under Venezuela's Hydrocarbons Law) is a wholly owned PdVSA subsidiary. Every JV (Empresa Mixta) in which CVP holds 50% or more falls within the definition of PdVSA Entity. The authorization therefore reaches the entirety of Venezuela's upstream operating structure.

II. The Governing Law Condition - The most consquential provision

GL 52 is not an unconditional opening. Paragraph (a)(1) conditions every authorized transaction on a requirement that any contract with PdVSA or a PdVSA Entity specify U.S. governing law and U.S. dispute resolution as a precondition for OFAC authorization.

This provision warrants careful attention. Venezuela's upstream sector has historically operated under contracts governed by Venezuelan law and subject to Venezuelan courts, a framework embedded in the Hydrocarbons Law itself and in the model joint venture instruments derived from it. GL 52 makes U.S. governing law and U.S. forum a compliance requirement for any established U.S. entity wishing to transact with PdVSA or its affiliates.

The implications for contract negotiation and restructuring are direct. Companies entering new agreements with PdVSA or its affiliates must now insist on these terms as a matter of U.S. regulatory compliance. Companies with existing arrangements will need to assess whether and how their current contractual frameworks interact with this condition. The intersection between GL 52's requirements and Venezuela's domestic legal framework (including the January 2026 Hydrocarbons Law reform, which itself introduced express arbitration provisions) will require careful navigation under both U.S. and Venezuelan law.

III. The Financial Architecture - Foreign Government Deposit Funds and Reporting Obligations

An OFAC license is a formal written authorization that permits activity which would otherwise be prohibited by U.S. sanctions regulations. Think of it as an exception granted by the U.S. government that allows specifically identified parties to engage in designated transactions under defined conditions.

Paragraph (a)(2) of GL 52 requires that monetary payments to blocked persons (excluding local taxes, permits and fees) be directed to Foreign Government Deposit Funds established under Executive Order 14373 of January 9, 2026, or to such other accounts as instructed by the U.S. Department of the Treasury, rather than made directly to Venezuelan government entities.

This mechanism means that royalties, production payments and other material financial flows associated with Venezuelan upstream operations pass through U.S.-designated accounts. Companies structuring transactions under GL 52 must ensure that their payment arrangements comply with this requirement from the outset.

Additionally, paragraph (d) imposes mandatory quarterly reporting obligations to the U.S. Department of State and Department of Energy for any established U.S. entity exporting Venezuelan-origin oil or petrochemical products under the license. Reports must identify the parties involved, products, quantities, values, dates, countries of ultimate destination, and all payments made to the Government of Venezuela. The first report is due ten days after the first such transaction.

IV. Exclusions - What GL 52 does not authorize

GL 52 contains several important exclusions that must be assessed in the context of any proposed transaction. It does not authorize transactions otherwise prohibited by E.O. 13808 (bonds and certain debt of the Government of Venezuela or PdVSA) or E.O. 13835 (transactions related to the sale, transfer or pledging of equity interests in PdVSA Entities by the Government of Venezuela). It does not permit the enforcement of liens, judgments, arbitral awards or other orders purporting to transfer or affect the property of blocked persons.

The license expressly excludes transactions involving entities linked to Russia, Iran, North Korea, Cuba, or Chinese-controlled entities, a deliberate structural feature reflecting the broader competitive and geopolitical objectives underlying the license.

V. Practical implications for companies with venezuelan exposure

1. For established U.S. entities currently outside Venezuela's energy sector, GL 52 removes the primary OFAC barrier to engagement across the full range of upstream commercial activity (financing, equity participation, services, insurance, offtake, and logistics). Subject to GL 52's terms and conditions, the question is no longer whether authorization exists, but whether the commercial, operational and legal conditions for engagement are met.

2. For companies already operating in Venezuela, GL 52 expands the authorized perimeter of their activities and may affect the terms on which existing arrangements are structured or renegotiated, particularly in light of the governing law and dispute resolution requirements.

3. For financial institutions and investors with financing exposure or contemplated equity positions in Venezuelan upstream assets, GL 52 provides a materially clearer authorization framework than has existed at any point in the sanctions period.

In all cases, GL 52 operates alongside Venezuela's domestic regulatory framework. Activities authorized under the license must also comply with Venezuelan law, including the January 2026 Hydrocarbons Law reform, applicable Ministerial authorizations, and the contractual and registration requirements governing joint venture operations. The interaction between the two frameworks requires concurrent analysis under U.S. sanctions law and Venezuelan energy law.

VI. Conclusion

GL 52 represents the most comprehensive authorization of U.S. commercial engagement with PdVSA and its affiliates issued to date within the existing sanctions framework. It is best understood not as a further incremental step in the sequence of licenses issued since January, but as a qualitative change in the regulatory framework, one that potentially opens Venezuela's upstream sector to the full breadth of the U.S. private sector on terms that embed U.S. legal standards and U.S. institutional oversight as conditions of participation.

A full client analysis addressing the implications of GL 52 in the context of the January 2026 Hydrocarbons Law reform, and the interaction between the OFAC licensing framework and Venezuelan domestic law, will be published by LEC Abogados shortly.

Disclaimer

This report is prepared for informational purposes only and does not constitute a legal advice. The interpretation and application of OFAC sanctions regulations are a complex area of U.S. law. Companies are strongly encouraged to consult qualified U.S. sanctions counsel before taking any action in reliance on GL 52. LEC Abogados is a Venezuelan law firm and does not practice U.S. law or provide advice on OFAC regulations. Information is current as of the date of publication.