Under Section 4 of the bill, which still needs to be signed by US President Barack Obama, the president would be authorized to impose sanctions on foreign entities dealing in prohibited or restricted activities in Russia.
«If you are an Asian company and you want to step into the shoes of what a US company used to be doing in a Russian crude oil project, and the US company cannot be doing that now because of sanctions…the [US] president can zap you with a menu of possible sanctions,» Rothberg explained.
Similar to US sanctions against Iran, Section 5 of the sanctions bill would target foreign financial institutions investing in proscribed activities in Russia, including funding of non-US entities engaged in prohibited activities in Russia. The sanctions could cut off a foreign bank from doing business in the US and international financial markets, Rothberg said.
«If you are legitimate foreign bank and you get restricted on how you can access the US banking system your ability to work as a true international bank is really adversely affected,» Rothberg said, stressing that the restrictions «could induce foreign banks to think very hard about certain transactions with foreign persons where those foreign persons are undertaking certain activities in Russia that are sanctionable».