So Long Syria Sanctions? Not So Fast!

The Department of the Treasury noted in a press release concerning GL 25 that it is “intended to help rebuild Syria’s economy, financial sector, and infrastructure, in line with US foreign policy interests.”

GL 25 can be found here; related Frequently Asked Questions (FAQs) can be found here; a related Fact Sheet can be found here; and the press release can be found here.

In tandem, the US Department of State issued a 180-day waiver under the Caesar Syria Civilian Protection Act of 2019 (Caesar Act), which otherwise authorizes sanctions on foreign persons that engage in certain transactions involving Syria, to facilitate investments and advance Syria’s recovery and reconstruction efforts. To further enable this, OFAC’s GL 25 FAQ 5 clarifies that non-US persons will not risk exposure to US sanctions for engaging in the types of activities that are authorized for US persons under GL 25.

The Financial Crimes Enforcement Network (FinCEN) also provided relief under the USA Patriot Act to allow US financial institutions to open and maintain correspondent accounts for the Commercial Bank of Syria.

However, US export controls under the Export Administration Regulations (EAR) continue to require a license or other authorization for the export and reexport of all items subject to the EAR except food and medicine, and Syria continues to be a proscribed country under the International Traffic in Arms Regulations (ITAR). Moreover, publicly traded companies still have US Securities and Exchange Commission (SEC) reporting obligations for transactions conducted with persons blocked pursuant to Executive Order 13224 (corresponding to the Global Terrorism Sanctions Regulations and program tag SDGT) or Executive Order 13382 (corresponding to the Weapons of Mass Destruction Proliferators Sanctions Regulations and program tag NPWMD. In short, US trade with Syria is still subject to substantial restrictions.

GL 25 Overview

GL 25 does not outright revoke OFAC sanctions directed at Syria but instead provides authorization to participate in transactions that would otherwise be prohibited under the Syria Sanctions Regulations (31 C.F.R. part 542), including the following, with certain important exceptions listed further below:

• The provision of services to people and companies in Syria.
• New investment in Syria.
• The import of or dealing in petroleum and petroleum products from Syria.
• Transactions with the current government of Syria.
• Transactions involving certain blocked persons listed in the Annex to GL 25 or any entities directly or indirectly owned 50% or more by those persons.

Examples of authorized transactions under GL 25 include, but are not limited to:

• Telecommunications-related services.
• Power grid infrastructure rehabilitation and other energy-related services.
• Health care-related services.
• Education-related services.
• Agricultural-related services.
• Civil-aviation and other transportation services.
• Construction-related services.
• Water and waste management-related services.
• Financial and investment services.

The broad authorization contained in GL 25 also allows US banks to process transactions for any activities authorized by GL 25 and US persons and members of the Syrian diaspora community to provide support to the new government of Syria.

Due to the fact that Syria’s current government and several of the persons on the Annex of GL 25 (and their 50% or more owned entities) are also blocked pursuant to OFAC’s Weapons of Mass Destruction Proliferators Sanctions Regulations (31 C.F.R. part 544), Global Terrorism Sanctions Regulations (31 C.F.R. part 594), Foreign Terrorist Organizations Sanctions Regulations (31 C.F.R. part 597), and/or Iranian Financial Sanctions Regulations (31 C.F.R. part 561), GL 25 also provides authorization under the aforementioned sanctions programs.

Like all OFAC general licenses, GL 25 is self-executing, which means individuals who conclude that their activities are permitted under a GL can proceed without needing additional confirmation from OFAC.

Exceptions to GL 25

GL 25’s authorizations exclude the following, which remain prohibited:

• Any transaction involving any person (individual or entity) on OFAC’s SDN List or any entity directly or indirectly owned 50% or more by one or more persons on OFAC’s SDN List, unless that person is listed in the Annex to the GL or is directly or indirectly owned 50% or more by one or more persons on that Annex.
• The unblocking of any blocked property or interests in property blocked (meaning that the property was in the United States or in the possession or control of a US person) as of May 22, 2025.
• Any transaction for or on behalf of the governments of Russia, Iran, or North Korea or related to the transfer or provision of goods, services, or technology, software, funds, or financing to or from Russia, Iran, or North Korea.

Continued US Export Control Restrictions to Syria

GL 25 does not affect the export control provisions under the EAR or ITAR on exports or reexports of US-regulated items to Syria.

Extensive restrictions remain on exports to Syria from the United States. Except for food and medicine classified as EAR99, as described in 15 C.F.R. § 746.9, all items that are subject to the EAR require a license for export or re-export to Syria. This means that items exported from the United States, items of US-origin (wherever or located), and foreign-made items containing more than de minimis (10%) controlled US content all require a license to Syria.

Additionally, Syria continues to be treated as a proscribed country by the US Department of State’s Directorate of Defense Trade Controls (DDTC), and is subject to a policy of denial under the ITAR (22 C.F.R. § 126.1(d)(1)). Even proposals and presentations to sell, export, transfer, reexport, or retransfer, any defense articles or defense service to Syria require a DDTC license or other approval (22 C.F.R. § 126.1(e)(1)), and if any person has reason to know of a proposed, final, or actual sale, export, transfer, reexport, or retransfer of articles, services, or data subject to the ITAR to Syria, that person must immediately notify DDTC (22 C.F.R. § 126.1(e)(2)).

Reporting Implications

In addition to ensuring compliance with the terms of GL 25, any companies that file annual or quarterly reports with the SEC must also ensure that they have considered the reporting requirements under Section 219 of the Iran Threat Reduction and Syria Human Rights Act (ITRSHRA) that may require disclosure of their activities or the activities of their affiliates.

While most of the Section 219 reporting requirements target dealings involving or related to Iran, Section 219 also requires disclosure of any transactions or dealings that issuers or their affiliates knowingly conducted with persons blocked pursuant to Executive Order 13224 (corresponding to the Global Terrorism Sanctions Regulations and program tag SDGT) or Executive Order 13382 (corresponding to the Weapons of Mass Destruction Proliferators Sanctions Regulations and program tag NPWMD). Several of the persons and entities listed in the Annex to GL 25 were designated pursuant to Executive Orders 13224 or 13382. There is no exception to the reporting requirement for licensed transactions involving persons designated under those Executive Orders, so companies will need to ensure they are positioned to identify and make any required disclosures in connection with activities conducted with such persons pursuant to GL 25. 

Writing and reporting by Gamin Kim.