State Sponsor of Terrorism Tag

April 18, 2022

President Volodymyr Zelenskyy of Ukraine has asked the President of the United States Joe Biden to designate Russia with a “state sponsor of terrorism” tag. Doing so will activate the harshest suite of sanctions available with the US government against Russia.

About the Tag

Any country can be designated as a “State Sponsor of Terrorism” by the US Secretary of State. Any country that has repeatedly provided support for acts related to international terrorism can be given this tag. The United States can place four sanction categories on the countries that are placed on this list that are a ban on defence-related sales and exports; restrictions on US foreign assistance; miscellaneous financial and other restrictions; and certain controls over exports of dual-use items. Also, sanctions can be implemented on individuals or countries that engage in certain trade with the “State Sponsor of Terrorism” designated countries.

Countries that are currently on this list

As of now, four countries have been tagged with the “State Sponsor of Terrorism” tag and they are Syria, Iran, North Korea, and Cuba.

The statutes authorizing this designation

At present, there are three statutes that authorize the Secretary of State to designate a foreign government with this tag and they are:

Section 620A of the Foreign Assistance Act of 1961 under which the transfer of most aid is prohibited;
Section 40 of the Arms Export Control Act (AECA) under which credits, exports, other financial assistance, guarantees, and export licensing overseen by the State Department are prohibited;
Section 1754(c) of the Export Controls Act of 2018.

Impact of this designation

This tag once designated to a country can hurt its financial system. The United States can freeze the country’s assets that are present in the United States. The US can also veto efforts made by that country to secure loans from the World Bank or the International Monetary Fund. Dual-use exports can be prohibited and the US can take any economic action against any countries that continue to trade with the designated country.

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