On September 18, 2026, President Trump signed H.R. 5334, the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026 (the “Act”),[1] into law. The House agreed to the Senate amendments on September 16 by a vote of 262–159, after the Senate passed H.R. 5334, as amended, on August 7 by a vote of 86–11.
This alert focuses on Division A of the Act, which codifies and builds on U.S. sanctions, prohibitions and tariff authorities relating to Russia and extends the Iran Sanctions Act of 1996 through 2031.[2]
I. Overview of the Act
Unlike an earlier proposal for the Act, the signed Act does not condition most measures on a presidential finding concerning Russia’s peace negotiations or conduct.[3]
At the same time, the President may terminate sanctions, restrictions or duties with respect to Russia or a Russian person after certifying that the Russian Federation has signed a peace agreement accepted by the free and independent Government of Ukraine and has ceased military hostilities against, and activities to overthrow, dismantle or subvert, the Government of Ukraine.
Other than Section 201 extending the Iran Sanctions Act of 1996, the Act focuses solely on Russia. All other provisions expire five years after enactment, or on September 18, 2031.[4]
Many sanctions, prohibitions and tariff measures of the Act take effect or must be implemented within 30 days after enactment, by October 18, 2026. In contrast, the Act’s prohibition on U.S. persons purchasing Russian sovereign debt took effect upon enactment and builds on the current U.S. sanctions prohibition under Directive 1A under Executive Order 14024, “Blocking Property With Respect To Specified Harmful Foreign Activities of the Government of the Russian Federation” (“E.O. 14024”), which, as of February 2022, prohibits only “U.S. financial institution[s]” from lending ruble and non-ruble funds to certain Russian sovereigns as well as participation in the primary and secondary markets for bonds issued by specified Russian sovereigns.[5]
The Act also directs the President to review specified persons and vessels and impose sanctions from a menu of options (i.e., blocking sanctions, or visa, admission or parole restrictions on individuals) on those determined to fall within the statutory criteria set forth under Section 102(b).[6] Those criteria encompass, among others, being a senior Russian government or military official, foreign person supporting Russia’s defense industrial base, a person undermining Ukraine’s sovereignty or critical infrastructure, leaders and controlling shareholders of Russian defense, energy, and transportation sector entities, Russian oligarchs, vessels used to circumvent U.S. or other-country sanctions, along with their owners, operators, insurers, and senior crew, and foreign port operators servicing sanctioned vessels.
The Act also clarifies that it will not have an impact on OFAC’s authority to issue specific licenses or authorize transactions conducted under OFAC general licenses.[7] As of the date of this alert, however, OFAC has not issued guidance on how any expansion by the Act of U.S. sanctions prohibitions, such as the expanded U.S. person prohibition on Russian debt purchasing, will interact with OFAC regulations.
Additionally, the Act also contains exceptions for specified humanitarian transactions; authorized U.S. intelligence and law-enforcement activities; admission or parole necessary to comply with certain international obligations; activities under the U.S.-Russia civilian nuclear cooperation agreement; certain low-enriched uranium and medical-isotope imports; official U.S. government and United Nations business; non-Russian oil transiting Russia; pre-enactment Treasury general licenses; qualifying wind-down and divestiture activity during the 270-day period beginning on enactment; vessel and crew safety; and specified NASA-related activities. Pre-enactment general licenses remain effective according to their terms, and Treasury retains authority to extend them or issue new general licenses.[8]
The Act also states that the civil and criminal penalties in section 206(b) and (c) of the International Emergency Economic Powers Act also apply to persons that violate, attempt to violate, conspire to violate or cause a violation of prohibitions of the Act (specifically sections 102 through 111 which generally cover the Act’s substantive sanctions and prohibitions relating to Russia-affiliated persons, entities, financial institutions, investments, energy, sovereign debt, financial messaging, and uranium imports), or an order or regulation prescribed under those specified sections.[9]
II. Financial Sector Sanctions
As noted, much of the Russia-related financial sanctions regime is not new but builds on existing U.S. Russia-related sanctions and restrictions.
The Act requires that, within 30 days of the Act’s enactment, the President impose two or more of a menu of sanctions described in section 103(d) of the Act on the Central Bank of Russia and any subsidiary or successor, which include blocking of property, sanctions options under section 235 of the 2017 Countering America’s Adversaries Through Sanctions Act (“CAATSA”), and restrictions on correspondent and payable-through accounts.[10] With respect to Sberbank, VTB Bank, Gazprombank, “any other financial institution organized under the laws of the Russian Federation and owned in whole or in part by the Government of the Russian Federation,” and “any subsidiary of, or successor entity to” those institutions, the Act requires that the President impose all of the sanctions described in section 103(d).[11] Although many of the mentioned banks are already heavily sanctioned, the Act allows for the possibility that, should the application of other sanctions authorities on these banks change, the CAATSA-related sanctions would still restrict the ability of these banks to open accounts or receive U.S. investment or financing, and executives or majority shareholders of those banks could also face blocking sanctions and visa restrictions. The Act also makes removal of those CAATSA-related sanctions more difficult because such removal would not depend solely on the President repealing or amending an executive order but would also require satisfying the Act’s independent termination conditions (including a certified peace agreement and cessation of hostilities) and surviving the mandatory congressional review period, during which Congress could block removal by joint resolution of disapproval.[12]
In addition, the Act requires the President to sanction “any foreign financial institution that engages in significant transactions with” the covered Russian financial institutions described above, including Sberbank, VTB Bank, Gazprombank, and other Russian government-affiliated financial institutions and their subsidiaries or successors (excluding the Central Bank of Russia, which is sanctioned separately), subject to an exception where Treasury “determines that imposing such sanctions is not consistent with the economic or foreign policy interests of the United States.”[13] The Act also requires sanctions on any entity that “operates with the intent to predominantly engage in the business of providing global financial messaging services” and is “knowingly being used to circumvent any sanctions imposed under section 103 or any other provision of” Title I, as well as on any “leader, official, senior executive officer, or member of the board of directors of, or principal shareholder with a controlling or majority interest in” such entity.[14]
III. Energy Sector Restrictions
The Act’s energy-sector and related restrictions (the new-investment prohibition, energy export and reexport bans, the sovereign debt purchase ban, the ban on national securities exchange trading of Russian-linked securities, and the uranium/Rosatom provisions) are significant not for their novelty but because they largely codify measures the executive branch has already imposed by executive order since 2022.[15] Since these measures are now statutory rather than resting on executive action, like the financial sector restrictions, unwinding them requires presidential certification and congressional review, making them more difficult for a future administration to reverse unilaterally.
IV. Duties on Russian Goods and Purchaser Countries
Section 112 of the Act requires the President, within 30 days after enactment, to increase duties on all goods imported from Russia to a rate of up to 500% ad valorem, in addition to otherwise applicable duties. Commentators have described the tariff authorities in Sections 112 and 113 as imposing “primary” and “secondary” tariffs, respectively, with Section 112 targeting Russian-origin goods directly, and Section 113 targeting third countries for their own energy purchases from, or sanctions-evasion activity on behalf of, Russia, rather than penalizing Russia directly, regardless of whether the tariffed goods have any connection to Russian energy.[16] Section 113 requires duties of up to 100% on goods imported from a country that meets the statutory criteria. For the initial determination, those criteria cover (i) a country that knowingly makes new purchases of Russian-origin crude oil or natural gas on or after 30 days after enactment and was among the five largest importers of such products during the preceding 12 months or (ii) a country that was among the top five countries facilitating Russian oil sanctions evasion during that period. A limited natural-gas exception applies where the statutory 15% threshold and reduction condition are met.[17]
Section 113 covers all goods from a designated country, not just goods tied to Russian energy. Accordingly, a designation could have broad commercial consequences, including higher import costs, for companies with significant exports to, or supply chains running through, any covered country.
Section 113 also affords the President flexibility, through two separate authorities. First, the U.S. Trade Representative may adjust a covered country’s rate anywhere between 0% and 100% upon a written determination that the country has taken “significant steps” to increase or decrease its Russian-origin energy purchases, accompanied by a written justification and methodology submitted to the relevant congressional committees at least 10 days beforehand.[18] Second, Section 115 authorizes the President to waive application of the Act’s sanctions, restrictions, or duties altogether, including the Section 112 and 113 tariffs, provided the President first submits to Congress “a certification in writing that the issuance of the waiver is in the national interests of the United States” and “a report explaining the basis for the certification.”[19] Together, these two authorities give the Administration wide latitude to calibrate, or decline to impose, the new tariffs on a country-by-country basis.
V. Key Takeaways
The principal new authorities are the tariff provisions in sections 112 and 113 of the Act, which authorize duties of up to 500% on Russian-origin goods and up to 100% on goods from countries meeting the statutory criteria for Russian energy purchases or sanctions evasion. It remains to be seen how the Administration will use these tariff authorities, and the Act’s periodic review and designation requirements (generally every 180 days), to exert additional economic pressure on Russia beyond the sanctions regimes already in place.
In terms of the sanctions related provisions, though little is new it will be interesting to track how the Administration uses these new authorities, including challenges the Administration might face if and when there is a future decision to remove these sanctions which now involves congressional review. The Act also raises implementation questions that OFAC and other agencies will need to address. For example, the Act’s prohibition on U.S. persons purchasing Russian sovereign debt took effect upon enactment. This prohibition is broader than the current OFAC prohibition under Directive 1A under E.O. 14024, which applies only to “U.S. financial institution[s]” and covers only lending and primary and secondary market participation with respect to specified Russian sovereigns. OFAC has not yet issued guidance on how the Act’s expanded prohibition will interact with existing OFAC regulations and licenses. Affected parties should continue to monitor OFAC guidance, designations, tariff determinations, and any new or amended general licenses through the initial 30-day implementation period ending October 18, 2026 and beyond.
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[1] Lindsey O. Graham Sanctioning Russia and Iran Act of 2026, Pub. L. No. 119–111 (Sept. 18, 2026); H.R. 5334, 119th Cong. (2026), bill status and actions, available here.
[2] Lindsey O. Graham Sanctioning Russia and Iran Act of 2026, H.R. 5334, 119th Cong. (2026) (enrolled bill), available here; see also Iran Sanctions Act of 1996, Pub. L. No. 104–172, § 13(b), 50 U.S.C. § 1701 note.
[3] See S. 1241, Sanctioning Russia Act of 2025, 119th Cong., sec. 4 (as introduced, Apr. 1, 2025) (conditioning imposition of sanctions under secs. 5–17 on a presidential “covered determination” as to whether the Russian Federation has refused to negotiate a peace agreement with Ukraine, violated such an agreement, or reinvaded), available here.
[4] H.R. 5334, secs. 201 and 203 (Iran Sanctions Act extension and sunset), available here.
[5] Prohibitions Related to Certain Sovereign Debt of the Russian Federation, Directive 1A Under E.O. 14024, 87 Fed. Reg. 32303 (May 31, 2022).
[6] Section 102(b) enumerates categories of covered persons and vessels, including senior Russian government and military officials; foreign persons supporting Russia's defense industrial base; persons undermining Ukraine’s sovereignty or critical infrastructure; leaders and controlling shareholders of Russian defense, energy, and transportation sector entities; Russian oligarchs; vessels used to circumvent U.S. or other-country sanctions; their owners, operators, insurers, and senior crew; and foreign port operators servicing sanctioned vessels. H.R. 5334, sec. 102(b), available here.
[7] H.R. 5334, sec. 114(h) (transactions under general licenses issued before the Act’s enactment remain unaffected, and Treasury retains authority to extend or issue new general licenses); sec. 105(b) (recognizing transactions “authorized by a specific or general license” as excepted from the funds-transfer prohibition); sec. 116(a) (incorporating the President’s authority under sections 203 and 205 of the International Emergency Economic Powers Act, 50 U.S.C. §§ 1702, 1704 — the statutory source of OFAC’s authority to issue both general and specific licenses), available here.
[8] H.R. 5334, sec. 114 (exceptions), available here.
[9] H.R. 5334, sec. 116(b), available here; see also International Emergency Economic Powers Act, § 206(b)–(c), 50 U.S.C. § 1705(b)–(c).
[10] H.R. 5334, sec. 103(a)(1)(A) (requiring imposition of “2 or more of the sanctions described in subsection (d)” against the Central Bank of the Russian Federation), and sec. 103(d) (describing the three-item sanctions menu: blocking of property, CAATSA sanctions, and restrictions on correspondent and payable-through accounts), available here.
[11] H.R. 5334, sec. 103(a)(1). The sanctions described in section 103(d) include blocking, two or more sanctions under section 235 of CAATSA not already imposed, and restrictions on correspondent and payable-through accounts, available here.
[12] H.R. 5334, sec. 117(a)(1)(A) (termination requires presidential certification that Russia has signed a peace agreement accepted by Ukraine and ceased military hostilities), sec. 117(b) (30-day congressional review period; 60 days for reports submitted July 10–September 7), sec. 117(c) (joint resolution of disapproval), available here.
[13] H.R. 5334, sec. 103(a)(1)(A) (imposing two or more of the sanctions described in subsection (d) with respect to the Central Bank of Russia and any subsidiary or successor); sec. 103(a)(1)(B)(vi) (“any foreign financial institution that engages in significant transactions with” covered institutions); sec. 103(c) (exception where the Secretary of the Treasury “determines that imposing such sanctions is not consistent with the economic or foreign policy interests of the United States”), available here.
[14] H.R. 5334, sec. 110(b)(1) (sanctions on any entity that “operates with the intent to predominantly engage in the business of providing global financial messaging services” and is “knowingly being used to circumvent any sanctions imposed under section 103 or any other provision of” Title I); sec. 110(b)(2) (sanctions on any “leader, official, senior executive officer, or member of the board of directors of, or principal shareholder with a controlling or majority interest in” such entity), available here.
[15] H.R. 5334, secs. 106–109 (securities trading, investment, energy exports and investment, and sovereign debt), and sec. 111 (Russian uranium import implementation and Rosatom-related sanctions), available here; see also USEC Privatization Act, § 3112A(d), 42 U.S.C. § 2297h–10a(d).
[16] See, e.g., Cong. Research Serv., Tariff Authorities in the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026, LSB11474 (Sept. 3, 2026) (referring to tariffs on imports from countries other than Russia under Section 113 as “secondary” tariffs, as distinguished from “primary” tariffs on Russian-origin goods under Section 112), available here; see also H. Comm. on Rules, Summary of Amendment to Senate Amendments to H.R. 5334 (Rep. Meeks, amend. #2) (Sept. 14, 2026 hearing) (describing the amendment as one that “[s]trikes the section of the legislation authorizing broad secondary tariffs”), available here
[17] H.R. 5334, sec. 113(d), available here.
[18] H.R. 5334, sec. 113(b); sec. 113(g)(1).
[19] H.R. 5334, sec. 115(b)(1); sec. 115(b)(4) (“The President is not required to submit a report under paragraph (1) for a modification or adjustment of a rate of duty pursuant to section 113(b),” and providing that this “does not modify or negate the requirement to submit a written determination required by section 113(b) or a report required by section 113(g)(1)”).
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