On June 12, the Department of the Treasury’s Office of Foreign Assets Control (OFAC) published a new Statement of Licensing Policy that allows US companies to request authorization to engage in transactions or other activities involving the telecommunication and agricultural sectors of Syria. This favorable licensing policy also allows US companies to request authorization to engage in transactions related to petroleum or petroleum products of Syrian origin for the benefit of the National Coalition of Syrian Revolutionary and Opposition Forces or its supporters.

The Statement of Licensing policy can be found on OFAC’s Web site here.1

Statement of Licensing Policy

The Statement of Licensing Policy provides for a favorable licensing policy for certain transactions and investments in Syria. Under Section 2 of Executive Order 13582 of August 17, 2011, US companies are prohibited from investing in new endeavors in Syria; exporting, re-exporting, selling, or supplying (directly or indirectly) any services to Syria; and engaging in any transaction related to petroleum or petroleum products of Syrian origin, among other things. Under the favorable licensing policy, however, US companies can apply to OFAC for specific licenses to engage in transactions or activities involving three sectors of the Syrian economy:

  • Telecommunications: Specific licenses may be issued on a case-by-case basis to authorize US persons to engage in transactions involving Syria’s telecommunications sector that are otherwise prohibited by Section 2 of Executive Order 13582, and that are not otherwise authorized by General License 5 under Executive Order 13582. The purpose of this policy is to enable private persons in Syria to better and more securely access the Internet.
  • Agriculture: Specific licenses may be issued on a case-by-case basis to authorize US persons to engage in transactions involving Syria’s agricultural sector that are otherwise prohibited by Section 2 of Executive Order 13582. The purpose of this policy is to enable projects to benefit and support the people of Syria by enhancing and strengthening the agricultural sector in a food insecure country.
  • Petroleum and petroleum products of Syrian origin: Specific licenses may be issued on a case-by-case basis to authorize US persons to engage in any transaction otherwise prohibited by Section 2 of Executive Order 13582, including but not limited to new investment, involving the purchase, trade, export, import, or production of petroleum or petroleum products of Syrian origin for the benefit of the National Coalition of Syrian Revolutionary and Opposition forces or its supporters.

Some important restrictions remain, however. The Statement of Licensing Policy provides that no licenses will be issued to authorize any transaction or activity, directly or indirectly, with:

  • The Government of Syria, including its agencies, instrumentalities, and controlled entities.
  • Specially Designated Nationals (SDNs) identified in prior Executive Orders (E.O. 13338, E.O. 13399, E.O. 13460, E.O. 13572, E.O. 13573, E.O. 13582, E.O. 13606, or E.O. 13608), sections 542.101 and 542.502 of the Syrian Sanctions Regulations (31 C.F.R. Part 542), and by any part of 31 C.F.R. Chapter V.

Conclusion

The Statement of Licensing Policy allows for the issuance of specific licenses for certain specific purposes, and is noteworthy for two reasons. First, it runs counter to the established trend of tightening financial and trade restrictions on Syria. Second, it explicitly names the National Coalition of Syrian Revolutionary and Opposition Forces and its supporters as the beneficiaries of the favorable licensing policy regarding petroleum or petroleum products of Syrian origin. The Statement of Licensing Policy likely represents the efforts of the US Government to support the opponents of the Assad regime, as well as bolster the Syrian economy and encourage new investment in Syria as the civil war continues to affect the everyday lives of Syrians and many others in the Middle East.