Published in its current form in August 2014, the rule states that property of an entity is blocked if blocked persons own it fifty per cent or more in aggregate. The ownership can be indirect and can be held through several parties: two designated persons holding twenty- five per cent each produce a blocked entity.
Two things about the rule drive behaviour. It is a bright line, so a structure that moves aggregate designated ownership to forty-nine per cent falls outside the automatic rule, and OFAC has said repeatedly that entities in which blocked persons hold a significant but non- controlling interest should still be treated with caution. And it says nothing about control: an entity can be run entirely by a designated person and still fall outside the rule on ownership arithmetic alone. The EU and UK regimes close that gap differently, by catching entities that are owned or controlled.