President Signs Lindsey O. Graham Sanctioning Russia and Iran Act of 2026

On September 18, 2026, President Trump signed the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026 (the Act) into law, which passed both houses of Congress with bipartisan support. The Act codifies and expands existing US sanctions against Russia, establishes new tariffs of up to 500% on Russian imports and up to 100% on goods imported from certain countries that purchase significant amounts of Russian crude oil or natural gas or facilitated Russian oil sanctions evasion, and extends the Iran Sanctions Act of 1996 for an additional five years.

Although many provisions of the Act build on existing sanctions authorities, the Act alters the US sanctions framework with respect to Russia by codifying certain existing sanctions requirements and making the imposition of many sanctions mandatory. For most provisions, the US president must conduct an initial review and, within 30 days of enactment (i.e., on or before October 18, 2026), impose sanctions on persons determined to satisfy the applicable statutory criteria. By placing these requirements into statute, the Act limits the extent to which the underlying sanctions framework can be modified or eliminated through changes to executive orders.

Notwithstanding these changes, the Act preserves general licenses “issued by the Department of the Treasury before the date of enactment of this Act.” Specifically, §114(h) provides that Title I (Sanctions With Respect to the Russian Federation) “shall not apply with respect to a United States person that is operating under the terms of a general license....” It further provides that nothing in Title I “shall be construed to affect the terms of a general license” or “the authority of United States persons to continue to operate under such a license.”

The Act also preserves significant presidential discretion in its implementation. Although sanctions are mandatory once the applicable statutory criteria are satisfied, the president retains responsibility for making many of the determinations that trigger those sanctions. This discretion may be particularly significant where relevant statutory terms are undefined. The president also retains broad authority to waive sanctions, restrictions, and duties under the Act upon certifying to Congress that the waiver is in the national interests of the United States and submitting a report explaining the basis for that certification.

The imposition of sanctions on certain persons under the Act, particularly on foreign financial institutions, can also be waived where the US secretary of the treasury determines that doing so will be inconsistent with the economic or foreign policy interests of the United States. As such, persons who may be impacted by the Act should closely monitor the status of implementing actions to understand how these changes may take effect.

NEW SANCTIONS ON RUSSIA

Much of the Act codifies or expands existing sanctions. The Act, however, also establishes several materially new sanctions measures under the US sanctions framework for Russia. These new measures target Russian government-owned and affiliated entities, certain transactions involving the Russian government, securities of Russian government-affiliated issuers, and Russia’s “shadow fleet” and related maritime networks. The following are among the most relevant new measures:

Mandatory sanctions on Russian government-owned or affiliated entities: The Act requires the president to review and impose blocking sanctions on entities in which the Russian government may have a controlling or majority ownership interest, or that may otherwise be affiliated with the Russian government. See Act § 104. Existing authorities authorize sanctions on government-owned or controlled entities upon a determination, whereas the Act creates a new, mandatory sanctions provision that reaches entities “affiliated” with the Russian government.
Mandatory sanctions targeting certain Russian “oligarchs”: The Act requires sanctions on “oligarchs” in Russia who have not demonstrated opposition to Russia’s war in Ukraine or who continue to benefit from an association with the Russian government. See Act § 102.
Mandatory sanctions targeting transferees of sanctioned persons’ assets: The Act requires sanctions on any foreign person to whom a person sanctioned under § 102 has transferred property or an interest in property after or shortly before sanctions were imposed on the latter. See Act § 102.
Mandatory sanctions targeting foreign persons who provide Russian persons with vessels for transporting certain energy commodities: The Act requires sanctions on any foreign person that knowingly transfers to Russia, or provides for the use by a Russian person, any vessel designed for transportation of crude oil, uranium, natural gas, liquefied natural gas, petroleum, petroleum products, petrochemical products, coal, or coal products. See Act § 102.
Mandatory sanctions targeting Russia’s “shadow fleet” and related maritime networks: The Act establishes a mandatory sanctions regime targeting foreign vessels used by the Russian government or Russian persons to move Russian-origin energy commodities and other goods for the purpose of circumventing sanctions imposed by the United States and its allies, including vessels involved in unsafe or nonstandard maritime practices, inadequate maritime insurance, or evasion of applicable oil price caps. Persons that own, operate, manage, insure, or provide services to such vessels, as well as foreign port owners or operators that permit sanctioned vessels supporting Russia to port or receive services, are also the targets under this provision. See Act § 102.
Restrictions on transfers involving the Russian government or government-owned entities: The Act prohibits US depository institutions and Securities and Exchange Commission–registered brokers and dealers from processing transfers of funds to or from the Russian government or Russian government-owned entities, or for the direct or indirect benefit of Russian government officials, unless the transfer relates to an underlying transaction authorized by a general or specific license issued by the US Department of the Treasury’s Office of Foreign Assets Control (OFAC). See Act § 105.
Prohibition on trading of securities of Russian government-affiliated issuers on US exchanges: The Act requires the US Securities and Exchange Commission to prohibit securities of any issuer that is a Russian government-owned, controlled, or otherwise affiliated entity from being traded on US national securities exchanges. See Act § 106.
Mandatory sanctions on SWIFT-type facilitators that are knowingly being used to circumvent sanctions imposed under § 103 or other provisions of the title: The Act requires sanctions on entities that (1) operate predominantly to provide global financial messaging services and (2) are determined by the secretary of the treasury, in consultation with the Secretary of the State, to be knowingly used to circumvent sanctions. See Act § 110.

EXPANDED & CODIFIED SANCTIONS

In addition to the new measures described above, the Act codifies existing sanctions and expands those frameworks in a variety of ways, while making the imposition of sanctions mandatory in most instances. Among the most relevant provisions are the following:

Expanded reach of Russian military-industrial base sanctions: The Act implicitly expands the reach of Executive Order (EO) 14024 (as amended by EO 14114) to any foreign persons, rather than only to foreign financial institutions, by requiring sanctions on foreign persons that knowingly sell, lease, or provide goods or services relating to Russia’s defense industrial base. See Act § 102.
Expanded and mandatory sanctions targeting the Russian financial sector: The Act codifies and expands existing sanctions targeting Russia’s financial sector and makes many of those sanctions mandatory. Among other measures, the Act codifies existing sanctions imposed under EO 14024 and requires sanctions on (1) the Central Bank of Russia; (2) Sberbank, VTB Bank, and Gazprombank; (3) other financial institutions organized under Russian law and owned in whole or in part by the Russian government; (4) subsidiaries and successor entities of such financial institutions. In addition, the Act requires sanctions on foreign financial institutions that engage in significant transactions with aforesaid financial institutions. See Act § 103.
Codification of restrictions on US investment and services in Russia: The Act codifies existing restrictions on new investment in Russia by US persons and on the provision of certain categories of services to persons located in Russia, including, for example, accounting, trust and corporate formation, management consulting, architecture and engineering, and certain information technology and software services. It also codifies restrictions on US persons approving, financing, facilitating, or guaranteeing transactions by foreign persons that would be prohibited if undertaken by a US person. See Act § 107.
Codification and expansion of energy-sector restrictions: The Act codifies the existing prohibition on new investment by US persons in Russia’s energy sector and prohibits the export, reexport, or in-country transfer to or in Russia of any energy or energy product produced in the United States. The Act also requires sanctions on foreign persons that knowingly provide goods, services, technology, or other support facilitating the maintenance or expansion of energy production for use by any person sanctioned under specified provisions of the Act. See Act § 108.
Codifies existing restrictions on Russian uranium imports and imposes sanctions on Rosatom leadership: With the Act now enacted, the president is required to take all necessary steps to implement the prohibition set forth in § 3112A(d) of the USEC Privatization Act on imports of Russian-produced low-enriched uranium, including uranium obtained through exchanges, swaps, or other arrangements designed to circumvent the prohibition. The Act also requires sanctions on Rosatom State Atomic Energy Corporation’s leadership, subsidiaries, and successor entities beginning on the date specified in § 3112A(d)(2)(C) of the USEC Privatization Act. See Act § 111
Codification and expansion of restrictions on Russian sovereign debt: The Act immediately prohibits any US person, including a US financial institution, from purchasing sovereign debt of the Russian government. The provision places existing restrictions on Russian sovereign debt into statute, expands the scope of covered sovereign debt to debt issued by the government of the Russian Federation more broadly, and makes the statutory prohibition applicable to US persons generally, rather than only to US financial institutions (though of course, the existing prohibition on new investment would also cover purchases of Russian debt). See Act § 109.

NEW TARIFF AUTHORITIES

In addition to sanctions, the Act establishes significant new tariff authorities targeting both Russia and certain third countries that continue to purchase Russian energy. The tariffs are additional to any other duties, taxes, fees, or charges otherwise applicable to the imported goods, including duties imposed under other executive tariff authorities.

Tariffs on Russian imports: The Act requires the President to increase tariffs on all goods imported from Russia to a rate of up to 500% ad valorem. This authority applies broadly to Russian-origin goods and is not limited to energy products. See Act § 112.
Tariffs on goods from certain countries purchasing Russian energy: The Act requires the imposition of tariffs of greater than 0% and up to 100% ad valorem on goods imported into the United States from certain countries that continue to purchase Russian-origin crude oil or natural gas. The provision applies to countries identified as among the five largest importers by volume of Russian-origin crude oil or natural gas and that knowingly purchase such products after the applicable statutory period. Importantly, the tariff applies to goods imported from the targeted country generally—not merely to Russian energy purchased by that country. See Act § 113. The tariff increase does not apply to a country whose Russian natural gas imports are under 15% of Russia’s total annual gas exports and that has taken significant steps to reduce those imports.
Tariffs on countries facilitating sanctions evasion: The Act also requires the imposition of tariffs of greater than 0% and up to 100% ad valorem on goods imported from certain countries identified as among the five largest facilitators of evasion of sanctions relating to Russian-origin oil. See Act § 113.

Although the Act mandates the imposition of these tariffs, it provides the executive branch significant discretion in determining the applicable tariff rate within the statutory ranges. See Act §§ 112–113.

BROAD PRESIDENTIAL WAIVER AUTHORITY

Although the Act makes many sanctions and tariffs mandatory, it preserves substantial presidential discretion through a broad waiver provision. Section 115 authorizes the president to waive the application of any sanctions provision with respect to a foreign person, any restriction with respect to a person, or any duty imposed under Title I of the Act. Accordingly, even where the Act requires sanctions or tariffs to be imposed once the applicable statutory criteria are satisfied, the president retains authority to waive their application.

To exercise this authority, the president must submit to Congress a written certification that the waiver is in the national interests of the United States, together with a report explaining the basis for that certification. The waiver authority is not conditioned on a determination that the sanctioned person has ceased the underlying conduct or otherwise satisfied specified remedial conditions. See Act § 115.

FUTURE REGULATORY DEVELOPMENTS

Certain provisions of the Act are likely to be implemented through amendments to OFAC’s existing sanctions regulations, including the Russian Harmful Foreign Activities Sanctions Regulations (31 CFR Part 587), rather than through a standalone regulatory regime.

OFAC has taken this approach with prior sanctions legislation, including the Countering America's Adversaries Through Sanctions Act of 2017, the Ukraine Freedom Support Act of 2014, and the Support for the Sovereignty, Integrity, Democracy, and Economic Stability of Ukraine Act, all of which implemented statutory requirements through amendments to existing sanctions regulations. The precise regulatory treatment will depend on the particular provision, and some provisions may instead be implemented through executive orders, determinations, directives, or other agency action.

Consistent with its approach to prior regulatory changes, upon implementation, OFAC will likely issue FAQs to provide concerned parties with additional guidance on the updated regulations.

CONSIDERATIONS

The Act places significant elements of the Russia sanctions framework on a statutory footing. By codifying, expanding, and making mandatory many sanctions and restrictions that previously existed under executive or other authorities, the Act limits the extent to which those measures can be modified or eliminated solely through changes to executive orders.

Businesses should reassess Russia-related sanctions exposure, including indirect exposure. The Act expands the categories of persons and entities potentially subject to sanctions and introduces new measures involving, inter alia, Russian government-owned and affiliated entities, financial transactions, securities, and Russia’s “shadow fleet” and related maritime networks. Companies should consider whether existing sanctions-screening and due diligence procedures adequately capture these expanded risks, including exposure involving counterparties, financial institutions, vessels, insurers, ports, and other intermediaries. Non-US financial institutions and other non-US persons that have exposure to Russia should consider reassessing sanctions risks.

Additionally, the Act creates potentially significant tariff exposure extending beyond Russia itself. In addition to requiring tariffs of up to 500% on goods imported from Russia, the Act provides for tariffs of up to 100% on goods imported from certain countries that purchase significant amounts of Russian-origin crude oil or natural gas or facilitate Russian oil sanctions evasion. Businesses should therefore evaluate potential exposure not only in transactions directly involving Russia, but also across supply chains and sourcing arrangements involving third countries known to trade with Russia.

Implementation will remain important despite the Act’s mandatory requirements. Many provisions require the president or other agencies to make determinations identifying the persons, countries, transactions, or activities subject to sanctions or tariffs. The president also retains broad authority to waive sanctions and duties under the Act upon making the required national-interest certification to Congress. Businesses should therefore closely monitor implementing actions, including new designations, tariff determinations, regulations, guidance, general licenses, and waivers.

Businesses relying on OFAC licenses should confirm that the applicable authorization covers all relevant sanctions authorities. As existing designated parties may become subject to new sanctions pursuant to the Act, companies should not assume that an existing general or specific license continues to authorize all transactions involving that person. Businesses relying on OFAC licenses should review the scope of the applicable authorization against each sanctions authority under which the relevant person is designated to confirm that the contemplated activity remains authorized.

Legal practice assistant Anna Pope contributed to this LawFlash.