OFAC, the US Treasury's Office of Foreign Assets Control, let General Licence V expire at 12:01am Eastern on Sunday 24 May without publishing any extension, replacement, or guidance1. The licence, signed on 24 April under Executive Order 13902, had authorised firms to wind down dealings with Hengli Petrochemical's sanctioned Dalian refinery. From Monday's Asia open, any non-US bank clearing dollars for Hengli faces a secondary-sanctions designation of its own.
The silence matters because of a structural question nobody answered. On 21 May, Hengli's Singapore arm transferred 95% of the Dalian refinery to Dalian Changxing, a Chinese state-linked trading house. OFAC's 50% rule treats any entity owned 50% or more by a blocked person as itself blocked. The transfer therefore clears sanctions only if Dalian Changxing is genuinely independent of the Hengli structure; if it is a front, the asset stays blocked and so does every bank that touches its dollars. No bank and no regulator answered that question before the deadline.
The expiry was mechanical, set on 24 April and immovable. The deal Trump declared the same weekend was verbal and contingent. Treasury enforcement and presidential diplomacy ran on the same Sunday without referencing each other, because one answers to a calendar and the other to a Truth Social post. OFAC's refusal to rule before the deadline is itself the enforcement posture: compliance desks must assume exposure and price it in.
Beijing had already moved. China's National Financial Regulatory Administration ordered banks on 1 May to stop new lending to five US-sanctioned refineries, while telling them not to demand repayment of existing credit2. That order, alongside MOFCOM's Announcement No. 21 blocking statute, shields the same five refiners OFAC has pointedly declined to designate. Asia opens Monday with the legal status of every Hengli dollar trade unresolved, the enforcement clock running, and the promised waivers conditional on a text that does not yet exist.
