These actions represent the culmination of a coordinated, multi-agency effort since May 2025 to dismantle the comprehensive framework of U.S. sanctions, trade controls, and financing restrictions that had applied to Syria—some since the United States designated Syria as an SST in 1979. However, targeted sanctions remain in place for specific individuals and entities associated with former President Bashar al-Assad, human rights abusers, drug trafficking, weapons proliferation, Iran proxies, and other destabilizing activity under the current Syria-related sanctions program known as thePromoting Accountability for Assad and Regional Stabilization Sanctions” (“PAARSSR”), 31 C.F.R. Part 569. Against this backdrop, this client alert reviews the measures that terminated the former comprehensive trade restrictions framework, explains the restrictions that remain, identifies areas of potential commercial opportunity, and outlines the diligence and compliance considerations companies should address when evaluating Syria-related activity.

Background: U.S. Comprehensive Sanctions on Syria

Syria was historically subject to one of the most comprehensive U.S. sanctions regimes that broadly prohibited U.S. persons from engaging in most transactions involving Syria, including the Government of Syria and Syrian financial institutions. The Syria sanctions program was based on multiple statutes and authorities, including:

• Primary sanctions. Through Executive Order (“E.O.”) 13338 of May 11, 2004, the United States declared a national emergency with respect to the Government of Syria, and imposed sanctions and sweeping export controls. This E.O., and successive executive orders, formed the foundation of the Syria sanctions program.
• Secondary sanctions. The United States also imposed an extensive secondary sanctions framework on entities and individuals doing business with Syria and in Syria. Specifically, the Caesar Syria Civilian Protection Act of 2019 (“Caesar Act”) required sanctions, upon a presidential determination, against foreign persons that supported the Government of Syria or engaged in specified transactions involving Syrian industry, including the infrastructure and energy sectors.
• Export controls.  The Syria Accountability and Lebanese Sovereignty Restoration Act of 2003 required the U.S. Department of Commerce to prohibit the export of all items on the Commerce Control List (“CCL”) to Syria, along with other restrictions (the “Syria Accountability Act”). Syria was also subject to export control restrictions under the Chemical and Biological Weapons Control and Warfare Elimination Act of 1991 (“CBW Act”) following the State Department’s determination that the Assad regime had used chemical weapons in 2013.

In addition, Syria and certain former and current members of the Syrian government were subject to U.S. terrorism-related sanctions and restrictions under separate sanctions authorities:

• Syria was originally designated as an SST in 1979, which triggered various statutory restrictions including on U.S. foreign assistance, defense exports and sales, exports of dual-use items, and financial transactions.
• HTS, previously known as Al-Nusrah Front, was designated as both a Foreign Terrorist Organization (“FTO”) and an SDGT under U.S. counterterrorism authorities in May 2014. Current Syrian President, Ahmed al-Sharaa, was also individually designated as an SDGT.

Gradual Removal of Comprehensive Sanctions on Syria and Easing of Export Controls

Following the fall of the Assad regime in December 2024, President Trump announced on May 13, 2025, that the United States would lift sanctions on Syria to encourage investment and promote a stable and peaceful future for the country. Pursuant to this announcement, U.S. agencies issued general licenses and waivers to provide sanctions relief to Syria:

• OFAC issued General License (“GL”) 25, which authorized transactions (1) prohibited by the Syrian Sanctions Regulations (“SySR”), 31 C.F.R. Part 542, subject to certain exceptions, (2) with the new Government of Syria as in existence on or after May 13, 2025, and (3) with 28 blocked persons and entities listed in the Annex of the GL, including President Ahmed al-Sharaa.
• The State Department issued a 180-day waiver of mandatory sanctions on foreign persons under the Caesar Act.
• The U.S. Treasury’s Financial Crimes Enforcement Network (“FinCEN”) provided exceptive relief to permit U.S. financial institutions to maintain correspondent accounts for the Commercial Bank of Syria.

Sanctions

On June 30, 2025, President Trump signed E.O. 14312, “Providing for the Revocation of Syria Sanctions,” terminating many sanctions on Syria, effective July 1, 2025. As a result of the termination of the national emergency and changes to U.S. policy toward Syria, OFAC removed the SySR in August 2025.

• As part of the implementation of E.O. 14312, OFAC removed 518 individuals and entities from OFAC’s SDN List. Notably, pending or future OFAC investigations or enforcement related to violations of the former SySR that occurred prior to July 1, 2025, may still proceed.
• Although comprehensive sanctions imposed against Syria were lifted, OFAC amended its regulations to implement PAARSSR, which targets specified individuals and entities—including persons associated with Bashar al-Assad, human rights abuses, drug trafficking, weapons proliferation, “Iran proxies,” and other destabilizing regional actors.
• Pursuant to E.O. 14312, the State Department revoked the FTO designation for HTS on July 8, 2025. Despite this, HTS and President al-Sharaa remained designated SDGTs, which prevented U.S. persons from engaging in any transactions or dealings with HTS and President al-Sharaa unless authorized by OFAC. Nonetheless, under OFAC GL 25, U.S. persons could engage in transactions with President al-Sharaa and certain transactions with the Government of Syria, which was defined as including “Syrian President Ahmed al-Sharaa and his government.” However, GL 25 did not include HTS within the definition of the “Government of Syria” or identify HTS in the Annex of the GL. Therefore, HTS remained a blocked person and was not covered by the authorizations under GL 25. In November 2025, the United States delisted current Syrian President Ahmed al-Sharaa, listed under the name Muhammad al-Jawlani, and Syrian Interior Minister Anas Hasan Khattab as SDGTs.

Furthermore, in December 2025, President Trump signed legislation repealing the Caesar Act, which removed the threat of mandatory secondary sanctions for non-U.S. persons providing support to the Government of Syria and engaging in certain transactions involving Syrian industry.

Export Controls

Consistent with the gradual easing of U.S. restrictions on business with Syria, in September 2025, the U.S. Department of Commerce’s Bureau of Industry and Security (“BIS”) amended the applicable export controls:

• A new license exception. BIS added a new license exception for Syria called License Exception Syria Peace and Prosperity (“SPP”), which authorizes exports and reexports to Syria of all items designated “EAR99.” However, such exports and reexports remain subject to end-use and end-user controls. BIS also made additional paragraphs of existing license exceptions available for exports and reexports to Syria.
• Broader license exceptions. BIS also expanded several existing license exceptions. Notably, BIS extended the Consumer Communications Devices (“CCD”) exception to Syria. License Exception CCD now allows for the export to Syria of common consumer technologies. Other changes to export control restrictions on Syria include expanded eligibility for replacement parts – though aircraft parts and items controlled for national security reasons remain excluded because Syria remains in Country Group E:1. Exporters must also seek a General Prohibition 10 waiver to deal with an item if that original item was initially exported unlawfully. The Aircraft, Vessels, and Spacecraft license exception now allows temporary sojourn of U.S.-registered civil aircraft and vessels in Syria and authorizes the export or reexport of spare parts classified as EAR99 or controlled for Anti-Terrorism reasons.
• New Licensing Policy. BIS revised its licensing policy with respect to Syria to align with U.S. national security and foreign policy interests and E.O. 14312’s objectives. Applications for exports for commercial or civil end uses that support Syria’s reconstruction and civilian economy – such as telecommunications, sanitation, water supply, power generation, and aviation – will now be reviewed under a presumption of approval. Other license applications will be assessed on a case-by-case basis.

Removal of Terrorism-Related Sanctions

On August 24, 2026, the State Department and Treasury Department took further action to remove terrorism-related restrictions on Syria. The Secretary of State rescinded Syria’s SST designation and delisted HTS and other Syrian government officials as SDGTs. Concurrently, OFAC removed HTS from the SDN List.

The rescission of Syria’s SST designation carries significant legal consequences. It removes the statutory prohibition on U.S. foreign assistance to Syria under the Foreign Assistance Act, lifts the ban on defense exports and sales under the Arms Export Control Act, eliminates the enhanced export licensing requirements triggered by the Export Control Reform Act of 2018, and removes restrictions on U.S. government credit and financial assistance. The rescission has since led to implementation action by OFAC and the State Department, including amendments to the Terrorism List Governments Sanctions Regulations and the International Traffic in Arms Regulations (“ITAR”).

As a result of the State Department and OFAC action, HTS is no longer blocked pursuant to the Global Terrorism Sanctions Regulations, 31 C.F.R. Part 594, nor executive orders authorizing sanctions on individuals associated with terrorist activities. Consequently, U.S. persons do not require authorization from OFAC to engage in transactions or activities with HTS, provided such activities do not involve blocked persons or otherwise prohibited activities. In line with these changes, OFAC revoked Syria GL 25, which is no longer necessary.

In addition, on September 25, 2026, OFAC amended the Terrorism List Governments Sanctions Regulations, 31 C.F.R. Part 596, to implement the rescission of Syria’s SST designation. OFAC also removed the Syria-specific general license in § 596.505 because the Government of Syria is no longer a Terrorism List Government for purposes of those regulations and the authorization is no longer necessary.

On August 24, 2026, the Secretary of State also waived the Syria Accountability Act’s prohibition on export to Syria of items on the U.S. Munitions List (“USML”), and waived remaining CBW Act restrictions including on U.S. sales to Syria under the Arms Export Control Act and on Syrian-owned or -controlled air transportation to or from the United States. The waiver became effective 20 days after the State Department’s announcement. Moreover, on October 1, 2026, the State Department amended the ITAR § 126.1 to remove Syria from the list of proscribed countries subject to an arms embargo and policy of denial. Instead, the State Department will now review license applications involving Syria on a case-by-case basis.

The State Department’s removal of Syria from the arms-embargo list in ITAR § 126.1 directly affects Syria’s treatment under Country Group D:5 in Supplement No. 1 to Part 740 of the EAR. The note to Country Group D:5 explains that the countries subject to U.S. arms embargoes are identified in ITAR § 126.1 and in State Department notices published in the Federal Register. Accordingly, if the EAR’s D:5 table differs from the State Department’s identification of countries subject to a U.S. arms embargo, the State Department’s determination controls. As of the date of this alert, BIS had not yet formally removed Syria from Country Group D:5, although an amendment is expected in the near term.

Key Considerations

The dismantling of the U.S. comprehensive sanctions regime and removal of terrorism-related restrictions on Syria represent one of the most significant recent shifts in U.S. sanctions and export control policy. These actions materially expand the opportunity for commercial engagement with Syria. However, companies seeking Syria-related opportunities should continue to engage in enhanced due diligence to assess sanctions, export control, and anti-money laundering risks. Key considerations include:

• Commercial opportunities have expanded significantly. The termination of comprehensive sanctions, repeal of the Caesar Act, removal of Syria’s SST designation, and easing of export controls have removed many of the principal U.S. legal barriers to trade and investment in Syria. These changes may support opportunities in infrastructure, energy, telecommunications, transportation, aviation, healthcare, financial services, construction, and other sectors important to Syria’s reconstruction and civilian economy.
• Targeted sanctions remain and require transaction-specific diligence. Syria is no longer comprehensively sanctioned, but OFAC continues to impose sanctions on specified individuals and entities, including persons associated with Bashar al-Assad, human rights abuses, Captagon trafficking, weapons proliferation, Iran and its proxies, and other destabilizing activities. Companies should screen counterparties, beneficial owners, banks, intermediaries, logistics providers, and end users against applicable restricted-party lists and assess whether any entity is treated as blocked under OFAC’s “50 Percent Rule,” which imposes sanctions on entities owned 50 percent or greater, directly or indirectly, in the aggregate by one or more sanctioned persons. Particular caution is warranted where a transaction has direct or indirect links to Iran, Iranian financial institutions, the Islamic Revolutionary Guard Corps, sanctioned regional actors, or historically sanctioned Syrian networks, especially given the United States Government’s recent actions escalating sanctions on Iran and targeting countries, persons, and entities that enable Iran to continue generating revenue. Our recent Client Alert provides additional information on developments in U.S. sanctions policy toward Iran.
• Export controls continue to apply independently of sanctions relief. BIS’s new licensing framework, including License Exception SPP, creates pathways for many commercial exports to Syria. However, items on the CCL may still require a license, and end-user, end-use, diversion, and restricted-party controls continue to apply. Companies should classify goods, software, and technology; evaluate all parties and destinations; confirm the ultimate end use; and determine whether a license, license exception, or other authorization is required before proceeding.
• Anti-money laundering concerns remain. Although FinCEN’s relief facilitates correspondent banking activity involving the Commercial Bank of Syria, U.S. financial institutions remain subject to the due diligence requirements under Section 312 of the USA PATRIOT Act and must continue to file suspicious activity reports where required. Companies should expect financial institutions to conduct enhanced diligence on Syria-related payments and should confirm in advance whether their banking partners will process the contemplated transactions. Banks may remain cautious because of money-laundering, sanctions, reputational, and operational risks, even where the underlying activity is legally permissible.
• The regulatory framework continues to evolve. Although several changes, as described above, have occurred, including the State Department’s recent amendment to the ITAR, companies should continue to monitor regulatory changes, including ITAR, EAR, OFAC, or FinCEN developments. Companies considering engagement in Syria should also account for the possibility that sanctions could be reimposed depending on the state of relations between the United States and Syria and Syria’s domestic political environment. Companies should monitor agency guidance and regulatory changes and consider contractual protections, wind-down rights, and contingency planning to address the possibility of future policy changes or the imposition of new targeted measures.

K&S’s International Trade team will continue to monitor Syria-related sanctions developments closely. Please contact any member of our team with questions or to discuss next steps.