Understanding U.S. Counter-Terrorism Sanctions
- Arne Mielken
- Jan 30, 2025
- 5 min read
Explore the key U.S. counter-terrorism sanctions, from EO 13224 to Hizballah regulations, and their impact on global security.
The United States employs a robust counter-terrorism sanctions regime enforced by multiple legal authorities. These measures are designed to block financial support for terrorist organizations and restrict transactions that could facilitate terrorist activities. Below, we explore the key executive orders and regulations underpinning these sanctions.
Key Executive Orders Shaping Counter-Terrorism Sanctions
EO 12947 (1995) and EO 13099 (1998)
Executive Orders (EO) 12947 and 13099 were among the earliest U.S. counter-terrorism sanctions. These orders specifically prohibit transactions with terrorists who pose a threat to the Middle East peace process. They laid the groundwork for targeted financial sanctions, restricting the ability of listed entities and individuals to access the U.S. financial system.
EO 13224 (2001) – The Response to 9/11
In the wake of the September 11, 2001, terrorist attacks, President George W. Bush enacted EO 13224. This order significantly expanded U.S. counter-terrorism measures by blocking property and prohibiting transactions with individuals and entities that commit, threaten to commit, or support terrorism. EO 13224 became a cornerstone of U.S. counter-terrorism sanctions, allowing authorities to designate individuals and organizations suspected of terrorist ties.
EO 13372 (2005) – Clarifying Terrorism Sanctions
Issued in 2005, EO 13372 aimed to refine and clarify the provisions of EO 13224. It provided additional definitions and procedural enhancements to ensure more precise enforcement of counter-terrorism sanctions.
EO 13886 (2019) – Modernizing Counter-Terrorism Sanctions
Recognizing evolving threats, EO 13886 was introduced in 2019 to modernize and strengthen U.S. sanctions against terrorism. This order expanded the scope of EO 13224, allowing authorities to target individuals and entities more efficiently, including secondary sanctions against those providing material support to designated terrorists.
Regulatory Framework for Counter-Terrorism Sanctions
The enforcement of U.S. counter-terrorism sanctions is codified in several key regulations under Title 31 of the Code of Federal Regulations (CFR). These include:
31 CFR Part 566 – Hizballah Financial Sanctions Regulations: Targets financial institutions that engage with Hizballah or its affiliates.
31 CFR Part 594 – Global Terrorism Sanctions Regulations: Covers individuals and organizations involved in global terrorism.
31 CFR Part 596 – Terrorism List Governments Sanctions Regulations: Imposes restrictions on governments designated as state sponsors of terrorism.
31 CFR Part 597 – Foreign Terrorist Organizations Sanctions Regulations: Prohibits transactions with groups designated as Foreign Terrorist Organizations (FTOs).
U.S. State Sponsors of Terrorism List
The U.S. government designates certain countries as State Sponsors of Terrorism (SST) based on their support for terrorist groups. As of now, four countries remain on this list:
Cuba
Democratic People's Republic of Korea (DPRK)
Iran
Syria
This designation imposes severe restrictions, including:
Limitations on U.S. foreign assistance
A ban on defence exports and sales
Tightened export controls on dual-use items
Financial restrictions impacting international transactions
Implications for Businesses and Financial Institutions
Businesses and financial institutions must comply with these sanctions by:
Conducting due diligence to avoid transactions with designated individuals or entities.
Implementing compliance programs to adhere to the Office of Foreign Assets Control (OFAC) regulations.
Staying updated on changes to the sanctions list, as designations are regularly updated.
Conclusion
The U.S. counter-terrorism sanctions framework is a critical tool in combating global terrorism. By imposing strict financial and economic restrictions on terrorist organizations and state sponsors, these measures aim to disrupt the funding networks that support terrorism. As threats evolve, so do U.S. sanctions, ensuring continued vigilance against terrorist financing.
EO 13886 Modernizing Sanctions to Combat Terrorism (September 10, 2019)
EO 13372 Clarification of Certain Executive Orders Blocking Property and Prohibiting Certain Transactions (February 16, 2005)
EO 13268 Termination of Emergency With Respect to the Taliban and Amendment of Executive Order 13224 of September 23, 2001 (July 2, 2002)
EO 13224 Blocking Property and Prohibiting Transactions With Persons Who Commit, Threaten To Commit, or Support Terrorism (Effective Date – September 24, 2001)
EO 13099 Prohibiting Transactions With Terrorists Who Threaten To Disrupt the Middle East Peace Process (Effective Date – August 21, 1998)
EO 12947 Prohibiting Transactions With Terrorists Who Threaten To Disrupt the Middle East Peace Process (January 23, 1995)
31 CFR Part 566 – Hizballah Financial Sanctions Regulations
31 CFR Part 594 – Global Terrorism Sanctions Regulations
31 CFR Part 596 – Terrorism List Governments Sanctions Regulations
31 CFR Part 597 – Foreign Terrorist Organizations Sanctions Regulations
FTO (foreign terrorist organisations) and SDGT (specially designated global terrorists) programmes on the OFAC SDN List
General License 2 – Travel, employment, residence and maintenance transactions with the Palestinian Authority (April 12, 2006)
General License 3 – Payment of taxes and incidental fees to the Palestinian Authority (April 12, 2006)
General License 4 – Transactions with entities under the control of the Palestinian President and certain other entities (April 12, 2006)
General License 5 – Concluding activities with the Palestinian Authority (April 12, 2006)
General License 6 – In-kind donations of medicine, medical devices, and medical services (July 6, 2006)
General License 7 – Broad authorization for U.S. persons to engage in all transactions otherwise prohibited by the terrorism sanctions programs with the Palestinian Authority (June 20, 2007)
General License 7a – Transactions with the Palestinian Authority authorized (May 14, 2013)
General License 8a – Authorizing Certain Humanitarian Trade Transactions Involving the Central Bank of Iran or the National Iranian Oil Company (October 26, 2020)
General License 14 – Authorizing Humanitarian Activities in Afghanistan (September 24, 2021)
General License 15 – Transactions Related to the Exportation or Reexportation of Agricultural Commodities, Medicine, Medical Devices, Replacement Parts and Components, or Software Updates in Afghanistan (September 24, 2021)
General License 16 – Authorizing Noncommercial, Personal Remittances to Afghanistan (December 10, 2021)
General License 17 – Authorizing Official Business of the United States Government (December 22, 2021)
General License 18 – Authorizing Official Activities of Certain International Organizations and Other International Entities (December 22, 2021)
General License 19 – Authorizing Certain Transactions in Support of Nongovernmental Organizations’ Activities in Afghanistan (December 22, 2021)
General License – To authorize payments from funds originating outside the United States for certain legal services to or on behalf of blocked persons, as well as the formation of legal defense funds to gather donations and dispense funds in connection with payments for such legal services (December 7, 2010)
General License 20 – Authorizing Transactions Involving Afghanistan or Governing Institutions in Afghanistan (February 25, 2022)
General License 21B – Authorizing Limited Safety and Environmental Transactions Involving Certain Vessels (January 12, 2023)
Iran General License A – Certain transactions otherwise authorized under general or specific licenses set forth in or issued pursuant to 31 C.F.R. chapter V authorized.
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