License 35 Released

On September 11, 2026, the Department of the Treasury’s Office of Foreign Assets Control (OFAC) issued a new general license, designated GL 35, in the Federal Register [1]. The license is issued pursuant to the Global Terrorism Sanctions Regulations and the Illicit Drug Trade Sanctions Regulations [1]. GL 35 authorizes a set of activities that would otherwise be prohibited under those sanctions regimes [1]. The rule notes that the license had previously been posted on OFAC’s website [1].

General licenses are a statutory tool that allows broad categories of transactions without the need for individual licensing [1]. By invoking both the Global Terrorism Sanctions Regulations and the Illicit Drug Trade Sanctions Regulations, OFAC signals that the activities covered by GL 35 intersect both counter‑terrorism and anti‑narcotics policy objectives [1]. The publication in the Federal Register formalizes the license’s legal status and makes it part of the public record [1]. This procedural step follows OFAC’s established practice of issuing and updating general licenses to reflect evolving policy priorities [1].

Strategic Logic

The issuance of GL 35 reflects Treasury’s intention to calibrate the impact of sanctions while preserving underlying policy goals. By providing a blanket waiver, OFAC can reduce administrative burdens for entities that meet the license’s criteria, thereby encouraging compliance with U.S. policy. The dual regulatory basis suggests that the authorized activities are deemed low‑risk for facilitating terrorism financing or illicit drug trafficking. This approach balances enforcement rigor with pragmatic trade considerations.

Publishing the license in the Federal Register also enhances transparency, allowing businesses, NGOs, and foreign governments to assess the scope of permissible conduct. The prior availability of the license on OFAC’s website indicates an incremental rollout that culminated in formal rulemaking. Such a sequence underscores Treasury’s preference for incremental policy adjustments rather than sweeping regulatory changes. The move signals to the international community that the United States remains engaged in fine‑tuning its sanctions architecture.

Policy Implications

For firms operating in sectors touched by the Global Terrorism or Illicit Drug Trade sanctions, GL 35 may open new channels for legitimate commerce and humanitarian assistance. The license could reduce the risk of inadvertent violations, thereby lowering compliance costs and encouraging participation in U.S. markets. By clarifying permissible activities, OFAC may also deter illicit actors who rely on ambiguity to exploit sanctions loopholes. The broader effect is a modest easing of trade friction where security concerns are deemed manageable.

Beyond immediate commercial effects, GL 35 may influence U.S. diplomatic leverage in regions where terrorism financing and drug trafficking intersect with trade. A more permissive licensing posture can be used as a bargaining chip in bilateral negotiations, offering targeted relief in exchange for cooperation on security objectives. Conversely, the license sets a precedent for future general licenses that could reshape the balance between sanction enforcement and economic engagement. Monitoring the implementation of GL 35 will be essential to gauge its impact on both security outcomes and trade flows.

Unresolved Questions

The Federal Register notice does not enumerate the specific categories of transactions covered by GL 35, leaving stakeholders to seek guidance from OFAC’s website or future clarifications [1]. Without detailed criteria, firms must interpret the license’s scope, which could generate uncertainty in compliance practices.

Future amendments or supplemental licenses could alter the balance struck by GL 35; a shift toward tighter controls would signal a reassessment of security risks, while additional waivers would indicate a continued trend toward trade facilitation.