Sanctions Relief and Regulatory Developments on Syria (2025)

Private Clients

In early 2025, the United States, European Union (EU), and United Kingdom (UK) introduced coordinated changes to their respective sanctions regimes targeting Syria. These developments reflect a shift in the legal and policy approach towards the Syrian government and are designed to facilitate humanitarian assistance, reconstruction, and limited commercial activity, while preserving mechanisms for accountability.

These amendments are legally significant in the context of international sanctions law, executive authority, and the compliance obligations of companies seeking to engage in Syrian-related activities. Businesses operating internationally — particularly in the banking, energy, logistics, and infrastructure sectors — should carefully assess their exposure to these new rules.

What changes have been made?

The recent developments vary by jurisdiction but are thematically aligned. The key regulatory changes include:

United States: General License No. 25 – Easing within Constraints

On 23 May 2025, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) issued General License No. 25 under the Syrian Sanctions Regulations (31 CFR Part 542).

Scope of GL 25

GL 25 authorizes U.S. persons to engage in certain transactions that would otherwise be prohibited, including:

• Export and financing of agricultural and medical goods;
• Reconstruction-related transactions tied to civilian infrastructure (e.g., water, power, sanitation);
• Limited financial services, including certain dealings with the Central Bank of Syria and state-owned enterprises not listed on the Specially Designated Nationals (SDN) List.

However, the license excludes any dealings with entities or individuals on the SDN List, and expressly prohibits transactions involving Russia, Iran, or North Korea.

The license does not override:

Executive Orders 13573, 13582, or 13606, nor The Caesar Syria Civilian Protection Act, which remains fully in force, particularly targeting sectors and actors implicated in human rights abuses.

OFAC has emphasized that the general license is a temporary and conditional measure, subject to review. Businesses must conduct enhanced due diligence to avoid secondary sanctions risk and ensure compliance with U.S. extraterritorial restrictions.

European Union

On 24 February 2025, the Council of the European Union adopted Decision 2025/406, amending Decision 2013/255/CFSP. This amendment introduced a suspension (not repeal) of selected restrictive measures, including:

• Limited re-engagement with Syrian state institutions in sectors relating to energy, transport, and financial transactions associated with such sectors and those needed for humanitarian and reconstruction purposes;
• Removal of certain entities from the list of those subject to the freezing of funds and economic resources, including the Industrial Bank, Popular Credit Bank, Saving Bank, Agricultural Cooperative Bank, and Syrian Arab Airlines;
• Introduction of exemptions to the prohibition of establishing banking relations between Syrian banks and financial institutions within the territories of the member states, to allow transactions associated with the energy and transport sectors, as well as transactions needed for humanitarian and reconstruction purposes.

On 28 May 2025, the Council further adopted legal acts to lift economic sanctions previously imposed on Syria, marking a significant shift in EU policy towards Syria. However, sanctions designations under the EU regime remain active, and transactions involving listed persons or entities continue to be prohibited without prior authorization.

United Kingdom

In the first half of 2025, the United Kingdom introduced significant amendments to its sanctions regime concerning Syria, reflecting a nuanced approach aimed at facilitating humanitarian assistance and supporting reconstruction efforts while maintaining pressure on the Syrian government.

Key Legislative Developments

Statutory Instrument 2025 No. 88

Effective from March 2025, this instrument amended the Syria (Sanctions) (EU Exit) Regulations 2019, introducing a general licence under Regulation 64. This licence authorises:

• Transactions related to the repair and maintenance of civilian infrastructure, particularly in the health and sanitation sectors.
• Engagements with certain Syrian ministries no longer designated under the amended regime.
• Relaxation of asset freeze provisions for specific state-owned entities operating in humanitarian sectors.
• Mandatory reporting requirements for UK entities engaging in permitted transactions, to be filed with the Office of Financial Sanctions Implementation (OFSI).

Despite these adjustments, the UK retains the authority to reimpose sanctions in response to any regression and continues to enforce broad restrictions on military goods and surveillance technology exports, aligning fully with UN Security Council measures.

OFSI General Licence INT/2025/5810196

Issued on 12 February 2025, this licence permits payments related to humanitarian assistance activities under the Syria (Sanctions) (EU Exit) Regulations 2019. It aims to facilitate the delivery of essential aid to the Syrian population.

Coming into force on 25 April 2025, these amendments removed certain UK restrictions to support Syria’s energy infrastructure and economic recovery. Key changes include:

• Lifting prohibitions on the export, supply, delivery, and transfer of aviation fuel and additives.
• Removing restrictions on goods and technology related to crude oil and natural gas, including ancillary services.
• Revoking prohibitions on the provision of banknotes and coinage to the Central Bank of Syria.

These changes aim to facilitate essential investment in Syria’s energy sector, supporting reconstruction efforts.

Compliance and Enforcement

Businesses operating under the amended sanctions regimes of the UK, EU, and US must undertake enhanced due diligence to ensure full compliance with the remaining restrictions. Although all three jurisdictions have introduced targeted relaxations to facilitate humanitarian aid and essential reconstruction in Syria, core prohibitions—particularly those relating to designated persons, military goods, and dual-use technologies—remain firmly in place.

In the United Kingdom, the Office of Financial Sanctions Implementation (OFSI) and the recently established Office of Trade Sanctions Implementation (OTSI) (October 2024) jointly oversee the administration and enforcement of financial and trade-related sanctions. UK companies must ensure reporting obligations are met and that any transactions under general licences are duly recorded and justified.

The European Union, while easing selected sectoral restrictions through Council Decision (CFSP) 2025/114, continues to prohibit engagements involving listed individuals and entities. Authorisations for humanitarian financial transfers and export licences require end-use verification and are subject to close scrutiny by competent authorities in each Member State.

In the United States, the Office of Foreign Assets Control (OFAC) maintains oversight of transactions involving Syria, even under General License 25C. While this licence authorises certain dealings in agricultural, medical, and civil infrastructure sectors, it does not suspend the applicability of the Caesar Syria Civilian Protection Act, nor does it affect sanctions targeting specific Syrian officials and institutions. Entities benefitting from U.S. authorisations must ensure strict compliance with record-keeping and reporting requirements.

Collectively, these regulatory adjustments reflect a shared approach among Western jurisdictions: a cautious but deliberate effort to ease economic pressure in humanitarian areas while preserving the integrity of sanctions frameworks designed to promote accountability, regional stability, and respect for international law.

Why Are These Changes Significant?

The 2025 changes represent a material evolution in the use of international sanctions law as a tool of foreign policy. From a legal perspective, their significance lies in the following key areas:

Transition from Blanket Sanctions to Targeted Relief

The measures indicate a shift from comprehensive sanctions towards targeted, conditional relief. Under international law, this reflects a preference for more proportionate, rights-compliant sanctions regimes. By allowing humanitarian and infrastructure-related trade, the sanctions frameworks align more closely with the principles of proportionality and necessity under customary international law.

Precedent for Conditional Licensing and Reversible Relief

These developments serve as a legal precedent for issuing general licenses and temporary suspensions that do not repeal the underlying legal framework. In the U.S., this operates under the authority of the International Emergency Economic Powers Act (IEEPA). In the EU and UK, similar legal mechanisms are employed to issue general or specific licences and suspend rather than revoke measures.

Such approaches preserve the coercive utility of sanctions while responding to evolving humanitarian or geopolitical needs.

Use of Sanctions as a Behavioural Incentive

The 2025 amendments are structured to serve as policy levers rather than permanent entitlements. Relief is contingent upon Syria’s cooperation with international bodies, credible political reform, and access for humanitarian agencies. This approach reflects the concept of conditional sovereignty in international relations, whereby compliance with international norms can trigger the lifting of economic restrictions.

Compliance Considerations

Businesses seeking to engage with Syrian entities or assets should:

• Review the applicable general licences or regulatory guidance in each relevant jurisdiction;
• Maintain documentation of the legal basis for each transaction;
• Consult legal counsel when engaging with dual-use goods, state-owned enterprises, or previously designated persons;
• Report transactions as required (especially under UK law and EU authorisation regimes).

Conclusion

The 2025 recalibration of Syria sanctions marks a notable shift in international regulatory posture. While the underlying legal regimes remain in force, the use of targeted relief mechanisms introduces new opportunities for engagement — and new compliance challenges. Entities seeking to transact in or with Syria must ensure careful legal assessment of their operations in light of the updated frameworks.

Further Questions

New Balkans Law Office advises international businesses and financial institutions on all aspects of sanctions compliance, including transactional due diligence, licensing applications, and risk assessments. For further assistance, please contact: [email protected].