(Reuters) – The U.S. Treasury Department on Thursday said claimants against Venezuela could not enforce liens, judgments, arbitral awards or decrees by seizing property to collect on unpaid debts unless they received specific authorization from Washington.

FILE PHOTO: Venezuelan opposition leader Juan Guaido, who many nations have recognised as the country’s rightful interim ruler, waves the Venezuelan flag at a gathering with supporters near Bolivia’s embassy in Caracas, Venezuela, November 16, 2019. REUTERS/Carlos Garcia Rawlins

Allies of Venezuelan opposition leader Juan Guaido said the move gave further protection to U.S. refiner Citgo Petroleum, a subsidiary of Venezuelan state oil company PDVSA that is being targeted by multiple parties seeking to enforce arbitration awards or claim collateral for debt.

But it was not clear if the move would permanently shield Citgo from seizure.

In an amendment to its sanctions on Venezuela, intended to force out socialist President Nicolas Maduro, the Treasury Department said any move to “transfer or otherwise alter or affect property” was prohibited unless authorized by a specific license.

Half the shares of Citgo were pledged as collateral for PDVSA’s 2020 bond, and the other half for a $1.5 billion loan extended by Russia’s energy giant Rosneft to PDVSA. The Treasury Department on Oct. 24 blocked any seizure of Citgo for three months, days before the bond went into default.

Maduro was blocked by sanctions from making the $913 million payment, while Guaido – the head of the opposition-controlled National Assembly who is recognized by the United States and dozens of other countries as Venezuela’s rightful president – does not have the funds.

“This clarification and strengthening of the United States’ measures to protect Citgo is an achievement of Juan Guaido’s interim government to more permanently protect Venezuelan state assets,” Carlos Vecchio, Guaido’s envoy to the United States, said in a statement.

Guaido allies have requested the Trump administration indefinitely block bondholders from seizing Citgo. While Maduro remains firmly in control of the state apparatus within Venezuela, the opposition earlier this year appointed a board of directors to Citgo, which exercises full control of the company.

Another source from Guaido’s team said Citgo may still be vulnerable to seizure should Treasury not renew its October decision to protect it once it expires in late January.

Neither the Treasury Department nor Citgo immediately responded to requests for comment.

Reporting by Luc Cohen and Mayela Armas in Caracas, and by Marianna Parraga in Mexico City; Editing by Marguerita Choy


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