Sanctions on Syria lifted after nearly five decades - Trade Treasury Payments

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Sanctions on Syria lifted after nearly five decades

In a reversal of longstanding US foreign policy, the Treasury Department’s Office of Foreign Assets Control (OFAC) issued General License 25 (GL 25) on 23 May 2025, lifting key sanctions on Syria and authorising economic activity previously prohibited under the Syrian Sanctions Regulations.

The announcement follows President Trump’s 13 May statement in Riyadh, where he declared the administration’s intent to unwind sanctions on Damascus mirroring similar decisions taken earlier in the month by the EU and UK and removing Syria from the US government’s list of comprehensively sanctioned jurisdictions. That list now includes Cuba, Iran, North Korea, Venezuela, and the occupied regions of Ukraine.

While GL 25 permits broad commercial engagement, the structure of the license and annexed authorisations make clear that Syria’s energy sector is the immediate priority. US persons are now authorised to engage in transactions with a range of state-owned petroleum and maritime entities, including Sytrol, the Syrian Petroleum Company, and both the Banias and Homs refineries.

This deviates from the previous administration’s policy architecture. Under General License 24, issued in January 2025, transactions were limited to the supply of foreign energy products to Syria. GL 25 builds on and replaces that framework, opening the door for direct investment in Syria’s domestic energy production and distribution infrastructure.

Shipping and port logistics have also been liberalised, with authorisations granted to the Tartous and Lattakia Port authorities and the Syrian Company for Oil Transport. In parallel, seven Syrian banks (including the Central Bank) have been licensed for transaction, beginning the process of bringing the country’s financial infrastructure into the global system.

In tandem with GL 25, the State Department issued a 180-day waiver under the Caesar Syria Civilian Protection Act. The waiver suspends secondary sanctions on foreign entities transacting with the Syrian government, enabling non-US investment without triggering penalties under US law.

That said, the waiver is temporary. While it may be renewed every 180 days at the discretion of the President (so long as it serves the “national security interests of the United States”), Congressional action would be required for any permanent repeal of the Caesar Act itself.

Compliance risk remains: sanctions not fully withdrawn

Despite the headline policy shift, GL 25 is not a blanket repeal. It provides a specific exception to otherwise applicable sanctions, limited to the entities listed in the license annexe. Key individuals and organisations remain subject to US restrictions, including former Syrian president Bashar al-Assad and Hayat Tahrir al-Sham (HTS), which remains a designated Foreign Terrorist Organisation and Specially Designated National (SDN).

US and non-US firms engaging in Syria must therefore ensure that transactions do not touch any blocked parties outside the scope of GL 25. Failure to do so could result in violations under US sanctions law or federal counterterrorism statutes.

GL 25 also does not affect US export controls under the Export Administration Regulations (EAR) or the International Traffic in Arms Regulations (ITAR). US exports to Syria remain tightly controlled. All dual-use items, defence articles, and technologies require authorisation, with very limited exceptions and the export of defence-related items remains prohibited under a policy of denial.

Strategic outlook

The lifting of sanctions on Syria, particularly in the energy sector, creates opportunities for early-mover investors to capitalise on a broader re-evaluation of US engagement in the region. Yet the framework remains highly conditional and easily reversible. GL 25 can be revoked at any time, and the Caesar waiver expires by default every six months.

For firms exploring opportunities in post-sanctions Syria, the commercial landscape is no longer off-limits, but it is far from risk-free.