A group of U.S. lawmakers has urged the Department of Commerce to ease export restrictions on Syria and remove the country from the “E:1” category. In their view, keeping the restrictions in place “prevents American companies from entering the Syrian market.” Senator Joe Wilson warned that further delays in shipments of U.S. technology could push Damascus closer to China, and stressed that speeding up the issuance of permits to U.S. exporters was necessary to give Syria more opportunities.
Senator Jeanne Shaheen, in turn, said that “easing sanctions alone will not be enough to spur the investment Syria so urgently needs.” She pledged to continue working to remove barriers to investment and added that Syrians deserve a chance to build a safe and prosperous future.
The “E:1” category in the U.S. Export Administration Regulations (EAR) groups countries Washington considers sponsors of terrorism; the list is overseen by the Department of Commerce’s Bureau of Industry and Security. It currently includes Syria, Iran, and North Korea. The designation restricts shipments of a range of U.S. goods, technologies, and software, including dual-use items, as well as goods made outside the United States if the share of controlled U.S. components in them exceeds 10%. Although the department eased restrictions on many civilian shipments last year, Syria has not been removed from the category, meaning companies still need licenses.
Washington has already dismantled most of the sanctions framework: on August 24, Syria’s designation as a state sponsor of terrorism was officially rescinded; Executive Order No. 14312 of July 1, 2025, terminated the national emergency; the “Syrian Sanctions Regulations” disappeared from the Federal Register in August 2025; and Congress repealed the Caesar Act in December. By August 2026, the United States no longer had either a comprehensive sanctions program administered by OFAC or a country-wide economic embargo against Syria—but the “E:1” label remained.
Experts say the licensing process, which often takes months, deters investors who are already concerned about the Syrian market’s long-term prospects. Syria’s place on the same list as North Korea and Iran, they say, sends a signal that normalization is incomplete and gives investors a reason to wait. Mohammed Alaa Ghanem, an adviser to the Syrian American Council, noted that the restrictions also apply to foreign goods and services containing more than 10% controlled U.S. components. He called it “illogical” that the state sponsor of terrorism designation had been lifted while the associated regulatory barriers remained in place.
In Damascus, economic adviser Ziyad Arbash is urging officials to resolve the legal and administrative issue by securing an official amendment from the Bureau of Industry and Security removing Syria from “E:1,” as well as an update to the State Department’s International Traffic in Arms lists. He said this is the last regulatory decision remaining in the export and technology file, and that it would logically complete the country’s removal from sanctions lists. He also pointed to the banking track: leaving the Financial Action Task Force (FATF) “gray list” requires genuine, verifiable reform of banking supervision, transparent governance, clear separation from sanctioned entities, and the actual ability to combat money laundering and terrorist financing.
At a FATF plenary meeting in Paris last Saturday, Safwat Raslan, governor of the Central Bank of Syria and head of the national anti-money-laundering commission, reaffirmed the country’s commitment to “building a stronger, more transparent, and more resilient financial system” and complying with international standards. He said the goal was not simply to meet the requirements for leaving the “gray list,” but to create an effective, sustainable national system capable of understanding and managing risks and applying global standards. Experts directly link the completion of financial and banking reforms to restoring international confidence and bringing investment back to Syria.
News commentary
What is the Caesar Act, and why is its repeal considered an important step toward normalizing economic relations between Syria and the United States? — The Caesar Syria Civilian Protection Act is a U.S. law passed in 2019 and taking effect in 2020. It is named after the pseudonym of a Syrian military photographer who provided images of torture victims. The law imposes sanctions on the Syrian government, as well as on foreign individuals and companies involved in Syria’s reconstruction, energy sector, financial transactions, and related sectors. Its repeal or substantial easing is considered an important step because it removes a distinct layer of U.S. sanctions law, reduces legal and reputational risks for foreign investors and banks, and signals normalization. However, repealing the Caesar Act does not, by itself, eliminate all U.S. restrictions.
How are the responsibilities of the Bureau of Industry and Security (BIS) and OFAC divided, and why does lifting OFAC sanctions not by itself remove Syria from the “E:1” category? — BIS, part of the U.S. Department of Commerce, administers export controls under the Export Administration Regulations (EAR), including country groups such as “E:1.” OFAC, part of the U.S. Department of the Treasury, administers sanctions programs, the SDN list, and financial restrictions. The “E:1” category is part of BIS export controls, not an OFAC sanctions list; it brings broad licensing requirements and a presumption-of-denial policy for many goods and technologies. Therefore, even if OFAC lifts or eases its sanctions, the export, reexport, or transfer of items subject to the EAR to Syria may still require BIS authorization.
What is the FATF “gray list,” what practical restrictions does it create for Syrian banks, and why does it make foreign investment difficult to attract? — The FATF “gray list” is a list of jurisdictions under increased monitoring because of strategic shortcomings in combating money laundering and terrorist financing. It is not a blanket ban, but it requires enhanced scrutiny of customers and transactions. For Syrian banks, this means stricter compliance requirements, increased scrutiny from foreign correspondent banks, the risk of losing correspondent banking relationships, delays and higher payment costs, and limited access to trade finance and dollar payments. Without leaving the list, foreign investors and banks face increased regulatory and reputational risks, making investment more difficult.
How does the 10% de minimis rule work in U.S. export controls for goods made outside the United States, and why does it complicate matters for foreign companies doing business with Syria? — Under the EAR’s de minimis rule, a foreign-made item is subject to U.S. export controls if it contains more than a specified share of controlled U.S.-origin content. For destinations such as Syria (in the “E:1” category), the threshold is generally 10%, compared with 25% for most other countries. If that threshold is exceeded, exporting or reexporting the foreign-made item to Syria may require a BIS license. This complicates matters for foreign companies because they must track component origins, classify U.S.-origin content, determine whether the EAR applies, and obtain authorization when necessary; even a small U.S. component can trigger controls.
Full version: Calls to remove a U.S. designation restricting exports to Syria—what is it?