What the Graham Act Changed

The Graham Act changes three key elements of the sanctions regime, and each of them matters to anyone affected by US sanctions.

– Existing Russia sanctions now have a statutory basis. A large part of the sanctions imposed by executive orders under the Russia program, above all under Executive Order 14024, now rests on a statute and not only on acts of the executive branch. In the past, a new President could in principle revoke such an order with a single signature. Now much of this regime has a legislative foundation.

– Relief for Russian persons is tied to the end of the war. To lift the statutory sanctions on a Russian citizen or a Russian company, the President must certify to Congress that Russia has concluded a peace agreement accepted by Ukraine and has ended hostilities. Congress then has 30 days to review the decision, or 60 days if the notice arrives between July 10 and September 7. Non-Russian persons are subject to a different mechanism: the President must certify to Congress that they have ended the conduct that led to the sanctions and have given reliable assurances that it will not resume.

– The President must regularly consider sanctions against a wider range of persons and vessels. Every 180 days, the President must reassess the persons and vessels that meet the statutory criteria and impose sanctions on those that do. The categories named in the Act include Russian oligarchs who have “not demonstrated opposition” to the war; executives and major shareholders of companies in the military-industrial complex, energy and transportation companies that support the Russian armed forces; and the owners, operators, masters and insurers of “shadow fleet” vessels.

The core Russia provisions of the Act remain in force for five years, until September 2031. The Act also gives the President a waiver: the President may decline to apply the sanctions, restrictions or tariffs it requires by certifying in writing to Congress that doing so serves the US national interest and explaining the reasons for that decision. Sanctions imposed under other programs, such as the 2014 Ukraine-related executive orders, are not locked in by the Graham Act. Many of those measures, however, had already been codified by the Countering America’s Adversaries Through Sanctions Act of 2017 (CAATSA) and are subject to separate congressional review mechanisms.

The Act does not take away existing legal remedies. What it mainly changes is the conditions for lifting certain sanctions. For some Russian persons already on the SDN List, delisting has become considerably harder. The picture is different for those who are not under blocking sanctions themselves, but whose assets were blocked because of the sanctions status of another party to the transaction. The Act leaves OFAC’s specific licensing in place, including licenses to release blocked assets, and the procedure works as before.

OFAC Licenses: How to Recover Blocked Funds

An OFAC license is the route for those who were never sanctioned themselves, but whose money is blocked because of sanctions on other people or companies. Such cases are now the majority, and the Graham Act will add to them: every new round of designations complicates or freezes payments of companies that did business with the newly listed.

A typical case looks like this. A payment went out through a bank that is not sanctioned, but a sanctioned party turned up somewhere in the payment chain, or the beneficiary was designated before the wire was completed. The bank blocks the transfer and reports it to OFAC within the required deadline. The funds are moved into a separate blocked account, and they cannot leave it without authorization. What is needed at this point is an OFAC specific license.

We first check whether any OFAC general license covers the situation. If none does, or if the bank still insists on a specific OFAC license to release the funds even though a general license applies, we prepare and file a specific license application. OFAC looks at the substance: whose money it is, where it came from, and whether a sanctioned person would gain any benefit from its release. The answers must be backed by documents, not merely by the applicant’s assurances.

If the owner of the property is on the sanctions list, the situation is more complicated. A specific license may authorize a particular transaction involving blocked property, but it does not usually mean the property is freely released to the sanctioned person. To regain full control of the assets, the key question becomes removal from the sanctions list. Other routes depend not on the owner but on decisions at the level of the entire program: an OFAC general license, revocation of the executive order, or sanctions relief granted by the President.

The Graham Act has not dismantled OFAC licensing. The U.S. Department of the Treasury still issues and extends general licenses, and the specific license process remains in place.

OFAC releases money not to whoever asks most persistently, but to whoever proves most convincingly that the money is theirs and has nothing to do with a sanctioned person.

Unblocking Assets Through the Courts

Licenses are not granted quickly, and not always. OFAC may leave a specific license application unanswered for a long time, deny it, or treat the funds as a sanctioned person’s property even though the applicant disagrees. In those cases, we can turn to the courts.

Suit is filed in federal district court. In cases against OFAC, that court is often the U.S. District Court for the District of Columbia (D.D.C.). The claim usually rests on the Administrative Procedure Act (APA). As a rule, the court does not substitute its own judgment for OFAC’s on the merits. It reviews whether the agency acted lawfully: whether it relied on the administrative record, explained its position, and avoided unreasonable delay. If OFAC drags out its review without justification, an unreasonable delay claim is available.

Sometimes filing suit alone prompts OFAC to take a harder look at the case, and the agency decides before the court reaches the decision. The Graham Act did not do away with judicial review: if OFAC made a legal error or acted arbitrarily, the court can set the decision aside or order the agency to reconsider the matter in accordance with the law.

OFAC SDN List Removal

It all starts with a petition for reconsideration of sanctions status and removal from the OFAC SDN List. Since late June 2026, OFAC has accepted these petitions through its dedicated Reconsideration Portal. When the factual and legal circumstances support it, we show that the sanctions were imposed in error or that the reasons for keeping them in place have fallen away, for example, because OFAC relied on incorrect facts, or because circumstances have changed: the petitioner sold the stake, left the position, or ended the relevant activity.

A petition must be prepared with great care. OFAC may send follow-up questions, and the answers and documents submitted become part of the administrative record. If the dispute reaches court, that record is exactly what the court will review. An inaccuracy or loose wording at an early stage can weaken the position later on.

After the Graham Act, much depends on who the petitioner is and on the basis for the sanctions. For a non-Russian person, such as a company from the UAE, Turkey or India designated over Russia-related business, the Act provides a separate route to relief: the President must send Congress the certification the Act requires, confirming that the conduct has ended and that reliable assurances against its resumption have been obtained. If Congress does not then enact a joint resolution of disapproval, the termination takes effect.

For a Russian citizen or a Russian company designated under Executive Order 14024 and covered by the new statutory restrictions, the path to relief has narrowed. Until a peace agreement is reached, one of the key routes, in our assessment, remains a presidential waiver in the individual case on national-interest grounds. That is why in these cases it is especially important first to pin down the exact legal basis for the sanctions and to understand which review mechanisms are available. How OFAC and other US agencies will apply the new rules in practice will become clear only with the first decisions.

Representation of Clients Before OFAC

We represent clients before OFAC and respond to inquiries from OFAC, other US government agencies and US banks. A great deal depends on the first submission: it is read as a statement of your position, and changing factual assertions or legal theory later can be much harder.

Not every service may be provided to a sanctioned person, and not every payment may be accepted. Under the Russian Harmful Foreign Activities Sanctions Regulations (RuHSR), 31 C.F.R. § 587.506, certain legal services to or on behalf of blocked persons are generally authorized, while other legal services require a specific license. Payment for authorized legal services is governed separately by § 587.507 and other applicable OFAC authorizations. An intermediary who accepts a sanctioned person’s money for “help with OFAC” without first determining whether both the services and the payment are authorized risks violating U.S. sanctions and creating additional problems for the client.

Sometimes what you need is not a proceeding but a precise answer to a specific question. Can this payment go through? Can the account be opened? Can a stake be sold if a sanctioned person is among the shareholders? What restrictions apply to a US company that keeps its business in Russia once the new Graham Act requirements take effect? We analyze your specific situation and give you an answer you can rely on with your bank or counterparty, and put it in a written opinion when needed. Write to us and we will tell you what options are available in your case.

How to Stay Off the OFAC Sanctions List

Can sanctions be avoided? In most cases, yes. After the Graham Act, this work has become particularly relevant.

OFAC and the State Department rely on open-source information, including press coverage, corporate registries and investigative journalism. The Graham Act adds criteria that can reach a wide range of people:

• an oligarch who has “not demonstrated opposition” to the war or still benefits from ties to the Russian government,
• an executive, board member or controlling shareholder of a defense, energy or transportation company that works for the military,
• an owner, operator, master or insurer of a vessel carrying Russian oil, gas or coal in evasion of sanctions,
• a foreign bank that conducts significant transactions with sanctioned Russian banks.

We assess your situation and help you develop an action plan to reduce the risk of being added to the sanctions list if your name already appears in the press next to sanctioned companies.

The first mandatory review of persons and vessels for designation on the SDN List is due around October 18, 2026. In preventive work, timing is critical: facts and documents are best gathered before the agency has formed its initial view. Contact us, and we will help you analyze your situation.