OFAC lifts certain sanctions on Syria, broad export controls remain in place

OFAC sanctions GL

General License (GL) 25 authorizes transactions previously prohibited by various regulations. Specifically, Section (a) broadly authorizes activities previously prohibited under the Office of Foreign Asset Control (OFAC)’s Syrian Sanctions Regulations (31 C.F.R. Part 542), except for dealings with Specially Designated Nationals (SDNs) or entities owned by SDNs at a 50% level or greater. 

Section (b) authorizes dealings with the current Government of Syria, entities owned or controlled by the Government of Syria, SDNs identified in the GL 25 Annex, and entities owned by the SDNs identified in the GL 25 Annex at a 50% level or greater. These dealings were previously prohibited, in addition to the Syrian Sanctions Regulations, by the Weapons of Mass Destruction Proliferators Sanctions Regulations (WMDPSR) (31 C.F.R. Part 544), the Iranian Financial Sanctions Regulations (IFSR) (31 C.F.R. Part 561), the Global Terrorism Sanctions Regulations (GTSR) (31 C.F.R. Part 594), the Foreign Terrorist Organizations Sanctions Regulations (FTOSR) (31 C.F.R. Part 597), and Executive Order 13574. 

According to the GL 25 Fact Sheet issued by OFAC on May 28, 2025, the license authorizes the provision of services to people and companies in Syria, new investments in Syria, the import of or dealing in petroleum and/or petroleum products from Syria, transactions with the new Government of Syria, and transactions involving SDNs listed in the GL 25 Annex. Examples of such authorized transactions 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, and financial and investment services (U.S. financial institutions are now authorized to process transactions with the Central Bank of Syria).

Non-U.S. persons do not face exposure under U.S. sanctions for engaging in activities or facilitating transactions or payments for activities authorized by GL 25. Furthermore, GL 25 does not remove any existing authorizations for humanitarian aid, such as the GTSR (31 C.F.R. Part 594) and FTOSR (31 C.F.R. Part 597) authorizations to conduct transactions in support of certain nongovernmental organizations’ activities, official business of the U.S. Government, and official business of certain international organizations.

However, GL 25 does not authorize:

• dealings with other SDNs in Syria that are not listed in the GL 25 Annex, or any entity owned by these non-listed SDNs at a 50% level or greater; 
• transactions on behalf of the Russian, Iranian, and the Democratic People’s Republic of Korea (DPRK) governments that involve the provision of goods, services, funds, and finances to and from Iran, Russia, or DPRK that involve Syria; and 
• dealing in assets or property that were previously blocked under Syria sanctions as of May 22, 2025, including property of the Central Bank of Syria. 

Like all OFAC GLs, GL 25 is self-executing and persons who determine that their activities are authorized under GL 25 may proceed with a transaction without further assurance from OFAC. It is important that companies keep records of any such transactions under the regulations as they are relying on an authorization issued by OFAC (because Syria sanctions have not been removed from the books; instead, a broad authorization was issued by OFAC to engage in activities noted above). 

OFAC has stated that it will continue to enforce sanctions on Assad, human rights abusers, Captagon drug traffickers, and persons involved in terrorist and proliferation activity. 

FinCEN exception to prohibitions on Commercial Bank of Syria

On May 23, 2025, the Financial Crimes Enforcement Network (FinCEN) issued a notice to provide relief under 31 U.S.C. § 5318(a)(7) and 31 C.F.R. §1010.970 pursuant to requirements under FinCEN’s rule imposing special measures against the Commercial Bank of Syria (31 C.F.R. § 1010.653).¹

Covered financial institutions are now permitted to open and maintain correspondent accounts for the Commercial Bank of Syria under certain conditions. Specifically, paragraphs (b)(1) and (2) of 31 C.F.R. § 1010.653 shall not apply to a correspondent account that is established, maintained, administered, or managed in the United States by a covered financial institution (as defined in 31 C.F.R. § 1010.653(a)(3)) for, or on behalf of, the Commercial Bank of Syria. This exceptive relief does not waive or alter due diligence obligations for covered financial institutions imposed by Section 312 of the USA PATRIOT Act and 31 C.F.R. § 1010.610.

State Department notice on Syria related to anti-terrorism

During the State Department press briefing held on May 27, 2025, Department spokesperson Tammy Bruce underscored the President’s vision for a “stable Syria,” including the recent steps taken by the Department and OFAC to lift sanctions on Syria. She also stated that the Department is engaging with regional and global partners to open investment in Syria.

While the State Department has noted certain policy changes, others barriers to full relations remain. On May 30, 2025, the U.S. Department of State published Public Notice 12735, a of Determination and Certification of Countries Not Cooperating Fully with Antiterrorism Efforts (90 Fed. Reg. 23,097). This Public Notice, dated May 7, 2025, identifies Syria as non-cooperative with U.S. antiterrorism efforts. 

To support the issuance of GL 25, and to address possible secondary sanctions risks related to dealings with the Syrian government that were imposed under U.S. legislation, the State Department issued a Caesar Syria Civilian Protection Act (Caesar Act) Waiver Certification on May 23, 2025, in conjunction with OFAC’s GL 25, waiving the application of certain sanctions to foreign persons for 180 days. Specifically, the State Department waived the application of sanctions under Section 7412 of the Caesar Act to: 1) transactions previously prohibited by the Syrian Sanctions Regulations (31 C.F.R. Part 542), and 2) transactions involving the Government of Syria, SDNs identified in the GL 25 Annex, and entities owned by the SDNs identified in the GL 25 Annex at a 50% level or greater previously prohibited by the WMDPSR (31 C.F.R. Part 544), IFSR (31 C.F.R. Part 561), GTSR (31 C.F.R. Part 594), FTOSR (31 C.F.R. Part 597), and Executive Order 13574. 

The waiver does not apply to other SDNs not listed in the GL 25 Annex or any entity owned by these non-listed SDNs at a 50% level or greater. It also does not waive transactions for or on behalf of the governments of Russia, Iran, the DPRK, or related to the transfer or provision of goods, technology, software, funds, financing, or services to or from Iran, Russia, or the DPRK.

BIS export licensing requirements

Comprehensive export control restrictions remain in place on Syria under the Export Administration Regulations (EAR) as the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) has not yet issued a parallel measure to GL 25. Syria still remains a “terrorist” designated country under section 6(j) of the Export Administration Act and pursuant to Section 1754(c) of the National Defense Authorization Act, Section 40 of the Arms Export Control Act, and Section 620A of the Foreign Assistance Act of 1961.

BIS has administered an export ban under the EAR against Syria for decades, with limited exceptions including for food and medicine classified as EAR99. EAR §746.9: Syria. BIS maintains detailed guidance regarding restrictions on Syria. A specific license is required to export or reexport to Syria all items subject to the EAR other than food or medicine designated as EAR99. Specific license requests for exports and reexports to Syria historically have been reviewed under a general policy of denial. In its guidance BIS states that it may review several categories of items on a case-by-case basis, including:

• Medicine on the Commerce Control List (CCL) and medical devices; 
• Telecommunications equipment and associated computers, software, and technology; and 
• Parts and components intended to ensure the safety of civil aviation and the safe operation of commercial passenger aircraft. 

Compliance and licensing considerations

In addition to the points raised above, many companies have made representations to financial institutions and third parties about not doing business in Syria. Any such contractual representations would need to be reassessed to determine if such business could be undertaken even if lawful. Transactions related to corporate due diligence will also continue. 

We note that dealings with certain sanctioned parties, even if authorized by GL 25, may trigger mandatory disclosure obligation in filings with the U.S. Securities and Exchange Commission. It is important to assess these disclosure obligations at the same time companies consider the compliance and licensing requirements.  

Authored by Beth Peters, Ajay Kuntamukkala, and Aleksandar Dukic. 

Summer Associate Emma Donahue contributed to this report.