Sanctions 2025

Last Updated August 14, 2025

USA – Washington, DC

Trends and Developments


Authors



Holland & Knight LLP has been advising clients for more than 130 years and has approximately 2,200 lawyers across the US and in five international offices. Holland & Knight services clients globally in a variety of areas, including commercial litigation, regulatory matters, mergers and acquisitions, healthcare, real estate, and government advocacy, just to name a few. The firm provides client-centric services across a wide range of industries, including Energy & Natural Resources, Real Estate and Hospitality, Finance & Financial Services, Healthcare & Life Sciences, Technology & Telecommunications, and Transportation & Infrastructure. Collaboration across practices, offices and industries, along with highly focused matter and case management, enables the firm to deliver dynamic legal services irrespective of location.

US Economic Sanctions: An Introduction

The US government continues to employ economic sanctions aggressively to achieve national security and foreign policy objectives, creating increasingly complex compliance risks for both US and non-US businesses.

The stated purpose of US sanctions is to deter, cut off resources to, and force change among governments, companies, and individuals who engage in activities that threaten US national security or foreign policy, such as development of weapons of mass destruction, terrorism, transnational criminal enterprises, gross violations of human rights, government corruption, destabilising democratic regimes, cybercrime, and sanctions evasion.

US sanctions are primarily administered and enforced by the US Department of the Treasury (Treasury) Office of Foreign Assets Control (OFAC), although the US Departments of State (State) and Justice (DOJ) also play important roles. Sanctions programs may originate in or be expanded by legislation passed by Congress, or they may derive from Executive Orders issued by the President under statutory authorities, including the International Emergency Economic Powers Act. Broadly speaking, US primary sanctions fall into three categories:

  • territorial embargoes, currently targeting  Cuba, Iran, North Korea, Syria, Crimea, and the self-proclaimed Donetsk and Luhansk Peoples’ Republics;
  • list-based sanctions, which range from full blocking sanctions that prevent a Specially Designated National (“SDN”) from accessing the US financial system or participating in nearly any other transaction involving US persons to more limited restrictions such as prohibitions on purchasing equity in the sanctioned party, and which typically extend to parties in which one or more sanctioned parties cumulatively hold 50 percent or more of the equity (the so-called 50 Percent Rule); and
  • sectoral sanctions, which prohibit specified activities involving a target jurisdiction but stop short of a total embargo – for example, sanctions that restrict new investment in Russia, imports of various Russian products, and exports of luxury goods and many types of services.

The restrictions imposed under US sanctions apply to “US persons”, which include entities organised under US law, as well as citizens, lawful permanent residents, and persons located in the United States. In the case of the Cuba and Iran programs, foreign subsidiaries of US entities are also required to comply. Nonetheless, US sanctions have a vast extraterritorial scope, primarily because:

  • US persons are not only prohibited from engaging in restricted activities, but also from facilitating prohibited activities by non-US persons; and
  • non-US persons can face liability for engaging in transactions prohibited by US sanctions if there is any US nexus that could “cause” a US person to violate US sanctions.

Breaches of US sanctions may be enforced through criminal or civil actions. Civil enforcement actions may be pursued even for unintentional violations (strict liability), and, in most cases, are subject to a maximum civil penalty currently set at USD377,700 per violation. In addition, where there is no US nexus, such that the US government cannot claim a breach of sanctions or pursue an enforcement action, so-called “secondary sanctions” authorities authorise the US government to designate non-US persons as SDNs (or impose other sanctions) for engaging in activities such as providing goods and services to specific targets of US sanctions or operating in specified sectors of a target country’s economy (eg, the Russian defence sector).

US Sanctions in 2025

As of June 2025, over 17,000 entities and individuals have been designated as SDNs and are thus subject to US blocking sanctions. These include governments and their instrumentalities, private and state-affiliated businesses, individuals, vessels, and aircraft in countries worldwide. Of these SDNs, 3,125 were added between 2023 and 2024, marking a 25% increase over that period. While geopolitical events can lead to rapid changes in US sanctions policy, there has been little slowdown in 2025 thus far.

The broad extraterritorial reach of US sanctions,  the rising number and complexity of prohibitions, and the expansion of secondary sanctions authorities have significantly increased the risks for companies worldwide, making it more essential than ever to monitor developments, assess the degree to which operations present sanctions risks, and address such risks through appropriate policies and procedures. In cases of apparent violation, OFAC strongly encourages parties to investigate and disclose the issues to OFAC, and offers reductions from the maximum applicable penalty for timely, well-organised and thorough voluntary disclosures with robust remedial measures.

Key Trends and Developments in 2025

Donald Trump’s return to the Presidency in January 2025 and resulting leadership changes at OFAC, State, DOJ, the Department of Commerce (“Commerce”) and other foreign policy positions have led to significant shifts in the US government’s sanctions policy and enforcement priorities. However, in several material respects, the Trump Administration has continued or intensified sanctions approaches that emerged in previous administrations. Thus far, US sanctions policy in 2025 appears to be primarily driven by the following geopolitical issues:

  • the fall of the regime of Bashar Al-Assad in Syria;
  • activities by cartels and drug traffickers in Mexico, Latin America, and the Caribbean;
  • Iran and Iran-affiliated parties’ support for terrorist organisations and destabilising activities, procurement of ballistic weapons and crewless aerial vehicles (UAVs), and pursuit of nuclear weapons;
  • the Russian Federation’s ongoing attack on Ukraine and the efforts to negotiate a ceasefire; and
  • the 7 October 2023 terrorist attacks on Israel by Hamas, and Israel’s military response in Gaza.

A review of sanctions designations, enforcement actions, and guidance issued by the White House, OFAC, the DOJ, and other agencies in 2025 clarifies the key targets, trends, and enforcement priorities that have emerged for the Trump Administration. We discuss these and other relevant developments below.

Syria: A Preliminary Reprieve from the US Embargo

On 23 May 2025, following the fall of the Bashar al-Assad regime in December 2024 and the new Syrian government’s outreach, OFAC, State, and the Financial Crimes Enforcement Network (FinCEN) took actions to provide preliminary relief from the US embargo on Syria. Relief was granted initially through the issuance of General License 25 (“GL 25”), which authorised a broad range of activities involving Syria that would otherwise be prohibited under the Syria Sanctions Regulations (“SSR”).

State also issued a 180-day waiver of the sanctions mandated by Section 7432(b)(1) of the Caesar Syria Civilian Protection Act of 2019 (“Caesar Act”), which accounts for certain blocked Syrian parties and certain investment restrictions, and FinCEN issued an exception under the USA Patriot Act, allowing US financial institutions to open and maintain correspondent accounts for the Commercial Bank of Syria.

On June 30, 2025, President Trump issued an Executive Order terminating the US government's Syria sanctions program and directing other actions to revoke the vast majority of US trade restrictions imposed on Syria by the US government. In announcing the recission, OFAC stated that "[t]he circumstances that gave rise to OFAC's Syria sanctions program, related to the brutal former regime of Bashar al-Assad, have been transformed by developments over the past six months, including the positive actions taken by the new Syrian government under President Ahmed al-Sharaa." Notably, following the recission and in accordance with a review ordered by President Trump, State revoked the FTO designation of Hay’at Tahrir al-Sham (HTS), the group closely associated with the new government of Syria.

Despite these actions, significant restrictions remain in effect as of August 2025, including comprehensive US export controls and prohibitions on transactions involving any individuals and entities associated with the former regime of Bashar al-Assad and other "destabilizing actors in the region" linked to ISIS and al-Qaida affiliates, as well as Iran and its proxies, who remain subject to blocking sanctions. Relief from the (limited) Caesar Act restrictions also cannot be extended beyond 180 days without congressional action.

Designating Mexican, Latin American, and Caribbean Cartels and Other Narcotics Traffickers as Foreign Terrorist Organizations and Specially Designated Global Terrorists

Recent designations of multiple cartels in Mexico, Latin America, and the Caribbean as Specially Designated Global Terrorists (SDGTs) and Foreign Terrorist Organizations (FTOs) create unique and significant risks for businesses operating in affected jurisdictions.

On 20 January 2025, President Trump issued EO 14157, announcing a policy “to ensure the total elimination of these organisations’ presence in the United States and their ability to threaten the territory, safety, and security of the United States through their extraterritorial command-and-control structures.” Following EO 14157, the State has designated the cartels and transnational organisations listed below as SDGTs and FTOs, and OFAC has designated dozens of members of these and other groups allegedly involved in narcotics trafficking.

  • Tren de Aragua (TdA) (described as originating in Venezuela with cells in Colombia, Peru, and Chile, with reports of sporadic presence in Ecuador, Bolivia, and Brazil).
  • Mara Salvatrucha (MS-13) (which reportedly originated in Los Angeles, and “actively recruits, organises, and spreads violence” in El Salvador, Honduras, Guatemala, Mexico, and the United States).
  • Cártel de Sinaloa (based in Sinaloa, Mexico and described as “one of the world’s most powerful drug cartels”).
  • Cártel de Jalisco Nueva Generación (CJNG) (reportedly present in nearly every part of Mexico, with contacts in Australia, China, and Southeast Asia).
  • Cártel del Noreste (CDN) (reportedly present in Northeast Mexico)
  • La Nueva Familia Michoacana (LNFM) (allegedly based in the Pacific coast state of Michoacan, with operations in various other Mexican states).
  • Cártel de Golfo (CDG) (reportedly based in northeast Mexico).
  • Cárteles Unidos (CU) (reportedly “formed from an alliance of multiple cartels and other groups in Michoacán, Mexico”).
  • Viv Ansanm (described as a “coalition of gangs” operating in Port-au-Prince, G-9 and G-Pép, Haiti).
  • Gran Grif (described as “the largest gang in Haiti’s Artibonite department”).

Many of the organisations listed above were already subject to US blocking sanctions. However, the updated designations increase the sanctions risk for businesses operating in regions where these parties are active for several reasons.

First, the SDGT designations create secondary sanctions risks due to provisions in EO 13224, as amended, authorising sanctions on persons that are owned or controlled by, or act for or on behalf of an SDGT, or have assisted in, sponsored, or provided financial, material, or technological support to an SDGT, or are otherwise “associated with” an SDGT.

Second, the FTO designations create liability exposure under amendments to the Anti-Terrorism Act, which permit US nationals injured by international terrorism committed, planned, or authorised by an FTO to file civil lawsuits against persons who “knowingly [p]rovide substantial assistance” to the FTO (see 18 USC. § 2333(d)(2)). Criminal charges may also be brought against persons who provide “material support” or “willfully provide or collect funds” for FTOs (see 18 USC. §2339B). The new head of the DOJ’s Criminal Division has also listed FTO-related investigations and prosecutions as a key priority.

According to OFAC, parties with operations in, or financial or supply chain connections to, the jurisdictions where the subject cartels and organisations are active face increased compliance risks because the designated entities may be involved in large, apparently legitimate businesses, particularly in the energy, hospitality,  mining, and real estate sectors. Companies should therefore give careful consideration to compliance measures necessary to identify and address such counterparty risks.

The “Shadow Fleet”: Maritime Shipping Remains Under Sanctions Spotlight

Entities, individuals, and vessels involved in sanctions evasion within the maritime oil and gas shipping ecosystem have become increasingly common targets of US sanctions, particularly in connection with sanctions programs related to Venezuela, Russia, and Iran. This trend intensified significantly during the Biden Administration, following the G7’s imposition of a “price cap” on Russian-origin oil in 2022, with the United States and the United Kingdom announcing continuous rounds of sanctions designations in response to efforts by vessels and related entities (referred to as the “Shadow Fleet” or “Dark Fleet”) to evade US sanctions and avoid compliance with the price cap.

In 2025, this trend has continued and intensified, but the focus has moved away from Russia to Iran, in line with President Trump’s National Security Presidential Memorandum 2 (NSPM-2), which announced a “max pressure” campaign on Iran and called for, among other things, a “robust and continual” campaign led by State in coordination with Treasury to “drive Iran’s export of oil to zero, including exports of Iranian crude to the People’s Republic of China.” NSPM-2 also called on the DOJ to “pursue all available legal steps to impound illicit Iranian oil cargoes” and disrupt efforts by the Iranian government to evade US sanctions and export controls.

On 10 January 2025, 183 vessels allegedly involved in Russia-related trades were sanctioned, along with several vessel insurers, management and holding companies, and Russian oil traders. Since President Trump took office on 20 January 2025, each round of  “Shadow Fleet”-related designations has been made under sanctions programs targeting Iran and terrorist organisations supported by the Iranian government, including Hezbollah, the Houthis, and the Iranian Revolutionary Guard Corps.

The aggregate result is that, since 2024, the number of vessels registered with the International Maritime Organization and subject to OFAC sanctions increased by over 46% to 1,841 (including individually designated vessels and vessels subject to sanctions due to sanctioned owners/operators). Sanctions authorities in other jurisdictions have also increased designations; according to industry reports, over 1,300 vessels are now directly identified on sanctions lists maintained by the UN Security Council, OFAC, the European Commission, United Kingdom’s HM Treasury, and Switzerland’s State Secretariat for Economic Affairs, representing (as of May 2025) a 30% increase from 2024 and a nearly 130% increase from February 2022 according to S&P Global. More recently, designations have targeted not only oil and gas tankers but also container cargo vessels allegedly connected to sanctions evasion networks.

In addition to vessels, OFAC has issued a steady stream of designations targeting parties within the oil and gas and maritime shipping sectors allegedly involved in “sanctions evasion networks”, including:

  • shipping companies;
  • vessel chartering companies;
  • technical and commercial managers for vessels and related service providers;
  • oil and gas brokers and traders;
  • financial institutions;
  • insurers;
  • port operators and port service providers; and
  • so-called “teapot” refineries (primarily in China).

Many of the designations have thus far targeted parties located in the UAE, Hong Kong, Oman, Singapore, Malaysia, China, and the Marshall Islands, further increasing the sanctions risks associated with those jurisdictions. However, parties located in the EU and UK, jurisdictions not historically targeted by US sanctions authorities, have also been designated. Notably, while China has historically not been a major target of US blocking sanctions despite periods of rising geopolitical tensions with the United States, a growing number of Chinese entities have been sanctioned for their role in purchasing and transporting Iranian oil.

Beyond the rising tide of sanctioned vessels and associated parties, updated guidance issued by OFAC and FinCEN on “red flags” for Iran-related maritime sanctions evasion and due diligence expectations underscore the regulatory scrutiny the maritime industry is receiving. The updated guidance includes the following recommendations:

Red Flags:

  • use of vessels that are uninsured or use sanctioned, new, or untested insurance providers for no apparent business reason;
  • use of vessels that have undergone frequent name changes or reflagging in different third-country jurisdictions or by registries not authorised to provide flagging services for a particular jurisdiction;
  • opaque ownership structures that involve layers of shell companies or special purpose vehicles (“SPVs”);
  • involvement of “exchange houses” registered in Hong Kong or the UAE, or “trading companies” located in close proximity to Iran;
  • falsified cargo, vessel, or transaction documents;
  • automatic identification systems (AIS) on vessels that have been disabled or manipulated;
  • ship-to-ship (“STS”) transfers or irregular voyages;
  • blending oil from third countries and/or relabeling the oil as originating in other jurisdictions (eg, “Malaysia Crude Oil Blend”); and
  • associations with or past use of “Shadow Fleet” vessels or entities affiliated with “Shadow Banking” networks.

Compliance Recommendations:

  • verifying cargo origin, vessel flag registration, and insurance;
  • reviewing cargo and transaction documentation for signs of manipulation or other “red flags”;
  • monitoring vessel location and data manipulation;
  • implementing contractual controls;
  • undertaking thorough KYC on vessels, owners, and managers, including reviewing vessel IMO registrations and associated travel patterns, available STS history, ownership history, insurance, flag history, ties to evasive activities, actors, or regimes, and potential sanctions risks associated with the vessel or its owners, operators, or managers; and
  • Reporting suspicious transactions to the relevant authorities.

In summary, the prevalence of sanctions evasion in the maritime shipping and oil and gas sectors, coupled with increased scrutiny from OFAC and other sanctions enforcement agencies, is creating a more challenging and demanding compliance landscape for maritime industry stakeholders.

DOJ: Prioritising Sanctions Violations for Criminal Enforcement

Recent criminal prosecutions and policy changes announced by the DOJ following President Trump’s inauguration in 2025 indicate that streamlining and pursuing criminal enforcement of US sanctions laws will be a key priority of the Trump Administration. For example, a memorandum issued by Attorney General Pam Bondi on 5 February, 2025, announced the removal of a longstanding requirement that local US Attorney’s offices obtain approval from DOJ’s National Security Division in Washington before filing charges or seeking search warrants in connection with terrorism and sanctions-related investigations that “target members or associates of any cartel or [Transnational Criminal Organization] designated as an [FTO] or SDGT.”

Separately, on 12 May 2025, the head of the DOJ’s Criminal Division published a memorandum titled “Focus, Fairness, and Efficiency in the Fight Against White-Collar Crime” (12 May Memo), which listed, among others, the following “high-impact areas” for the Criminal Division to prioritise investigations and prosecutions:

  • violations by corporations involving material support of terrorism;
  • “conduct that threatens the country’s national security, including sanctions violations or [enabling] transactions by cartels, TCOs, hostile nation-states, and/or foreign terrorist organisations”;
  • material support by corporations to FTOs, including cartels and TCOs; and
  • digital assets cases involving cartels, TCOs, or terrorist groups, or facilitating money laundering or sanctions evasion.

Perhaps most significantly for the average company, the 12 May Memo added “corporate sanctions offenses” (among other things) to the list of corporate offenses for which whistleblowers who provide original and truthful information can recover rewards under the DOJ’s Corporate Whistleblower Awards Pilot Program, increasing the incentive for employees to report on corporate failures to comply with US sanctions regulations.

Although these actions signal an intent by DOJ to increase their focus on sanctions violations, particularly by corporations, it is notable that, on the same day as the 12 May Memo, DOJ’s Criminal Division also published a new Corporate Enforcement and Voluntary Self-Disclosure Policy (CEP) establishing a policy under which it will be generally easier for companies to avoid criminal prosecution if they voluntarily disclose potential sanctions violations, cooperate with DOJ investigations, and mitigate harm.

Other Policy and Enforcement Developments

Other significant policy changes announced thus far in 2025 include the following.

An unannounced and unofficial pause on sanctions designations related to the Russian Federation since President Trump took office. However, comments by President Trump and Trump Administration officials suggest that this policy may be temporary. Members of Congress have also introduced legislation that appears to have significant support and, if passed, could trigger additional sanctions on Russia. Furthermore, despite the absence of new Russia-related designations, OFAC continues to pursue enforcement actions related to Russia. Indeed, four of seven settlements announced by OFAC so far in 2025 involve Russia-related violations, including a USD215 million dollar settlement with a venture capital firm for allegedly managing an investment for a sanctioned Russian oligarch, and two one million dollar settlements for alleged export of industrial equipment to Russian SDNs and allegedly assisting SDNs to evade sanctions by transferring ownership of luxury condominiums to non-sanctioned family members and associated shell companies.

The Trump Administration’s revocation and rescission of the West Bank Sanctions Program, implemented under President Biden, target persons determined to be undermining peace, security, and stability in the West Bank.

The Trump Administration’s implementation of a new sanctions program targeting prosecutors, judges and other persons affiliated with the International Criminal Court (ICC) in response to the ICC’s issuance of arrest warrants and filing of charges against Israeli officials after the Israeli military’s response to Hamas terrorist attacks on 7 October, 2023.

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Trends and Developments

Authors



Holland & Knight LLP has been advising clients for more than 130 years and has approximately 2,200 lawyers across the US and in five international offices. Holland & Knight services clients globally in a variety of areas, including commercial litigation, regulatory matters, mergers and acquisitions, healthcare, real estate, and government advocacy, just to name a few. The firm provides client-centric services across a wide range of industries, including Energy & Natural Resources, Real Estate and Hospitality, Finance & Financial Services, Healthcare & Life Sciences, Technology & Telecommunications, and Transportation & Infrastructure. Collaboration across practices, offices and industries, along with highly focused matter and case management, enables the firm to deliver dynamic legal services irrespective of location.

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