The Russia Sanctions Bill: What You Need to Know

Amir Fadavi · 2026-08-04

Congress is inching toward enacting a Russia (and now Iran) sanctions statute. What began in April 2025 as S. 1241, the Sanctioning Russia Act of 2025, has been renegotiated, renumbered, and—as of the end of July 2026—taken up on the Senate floor with overwhelming bipartisan support. Here is where the bill stands, what it would do, and why compliance teams should be reading it now rather than after enactment.

What is it?

A bill is proposed legislation. It creates no legal obligations unless and until it passes both chambers of Congress in identical form and is signed by the President (or a veto is overridden). Until then it is a forecast.

The original bill. S. 1241 was introduced in the Senate on April 1, 2025 by Senator Lindsey Graham (R-SC), with Senator Richard Blumenthal (D-CT) as his lead Democratic partner.[^1] It attracted an unusually deep bipartisan bench—84 cosponsors, split 42 Democrats, 41 Republicans, and one Independent.[^2] It was referred to the Senate Committee on Banking, Housing, and Urban Affairs, where it sat for more than a year while negotiators worked with the White House over how much discretion the President would retain.[^1] In January 2026, Senator Graham announced that President Trump had "greenlit" the package.[^3]

The current text. Three documents are in play:

  • S. 1241 (April 2025)—the original bill. Superseded.
  • S. 5025, the Lindsey O. Graham Sanctioning Russia Act of 2026—introduced July 16, 2026 by Senator Darline Graham (R-SC), who was appointed to Lindsey Graham's seat after his death, joined by Senator Blumenthal and roughly 60 other cosponsors from both parties. Referred to Senate Banking.[^4]
  • H.R. 5334—the number appearing in floor coverage. This is not a sanctions bill. It is the SEED Act, an unrelated House-passed tax measure amending the educator expense deduction, which was sitting on the Senate calendar as Cal. No. 454.[^5] The Senate is using it as a legislative vehicle: a procedural shell whose text is struck and replaced.

The operative text is the amendment in the nature of a substitute offered by Senators Graham and Blumenthal, dated July 27, 2026, which strikes everything after H.R. 5334's enacting clause and inserts the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026.[^6] Title I of that substitute is materially identical to S. 5025 as introduced; the substitute adds a short Title II carrying the Iran extension, a severability clause, and a sunset.

If you want to read the current version of the bill, it is here: substitute text.

Where it stands. On July 28, 2026, the Senate invoked cloture on the motion to proceed to H.R. 5334 by a vote of 86–12; Senator Rand Paul (R-KY) was the only Republican in opposition.[^7] The Senate agreed to the motion to proceed 84–12 the following evening.[^8] Both were procedural votes, not final passage. The House is not scheduled to take the measure up until after the August recess.[^9]

What does it do?

A structural change worth flagging. First off, the 2025 bill was conditional on certain determinations: the imposition of sanctions hinged on a presidential determination that Russia had refused to negotiate, violated a peace agreement, invaded again, or sought to subvert the Ukrainian government.[^10] The substitute drops that trigger. Under the substitute, obligations run from the date of enactment on fixed clocks (generally 30 days, with recurring 180-day review cycles), and relief runs the other way, through the President's waiver and termination authorities.[^11]

Under Title I of the substitute, the President would be required to:

  • Sanction senior Russian officials and specified categories of persons. Within 30 days, and every 180 days thereafter, review and impose blocking sanctions and visa bans on twenty-four named leadership posts—President, Prime Minister, Defense Minister, Chief of the General Staff, service chiefs, FSB and SVR directors, and the ministers of foreign affairs, transport, finance, industry and trade, energy, and agriculture—plus any other senior official as the President determines. The bill also includes 27 grounds for designation, including foreign persons who knowingly supply the Russian defense industrial base (including CNC tooling, nitrocellulose, advanced sensors, and BIS Common High Priority List items), transact significantly with the Russian armed forces, undermine Ukraine's infrastructure or democratic processes, or qualify as oligarchs who have not demonstrated opposition to the war.[^12]
  • Sanction Russian financial institutions and their foreign counterparties. Within 30 days, impose two or more measures on the Central Bank and the full menu on Sberbank, VTB, Gazprombank, any other state-owned Russian bank, their subsidiaries and successors, and—subject to a Treasury carve-out—any foreign financial institution engaging in significant transactions with them. Measures are IEEPA blocking, CAATSA menu sanctions, and correspondent/payable-through account restrictions. U.S. persons are separately barred from transacting with the listed institutions at day 30.[^13]
  • Sanction other Russian state-owned or state-affiliated entities, on the same 30-day/180-day cycle.[^14]
  • Prohibit fund transfers. Depository institutions and SEC-registered brokers and dealers may not process transfers to or from the Russian government or state-owned entities, or for the benefit of Russian officials, absent a licensed underlying transaction.[^15]
  • Delist Russian issuers. The SEC must bar securities of Russian government-affiliated issuers from trading on national securities exchanges within 30 days.[^16]
  • Ban new U.S. investment in Russia, plus service exports in categories Treasury identifies and facilitation of prohibited foreign transactions.[^17]
  • Ban energy exports to Russia and new U.S. investment in its energy sector, and sanction foreign persons supporting Russian hydrocarbon or uranium production for sanctioned parties.[^18]
  • Ban U.S. purchases of Russian sovereign debt, effective on enactment.[^19]
  • Sanction financial messaging providers knowingly used to circumvent the bank sanctions (the SWIFT-style provision), with an exception for providers already complying with an equivalent foreign sanctions regime or servicing significant U.S. business.[^20]
  • Implement the Russian uranium import ban and sanction Rosatom leadership.[^21]
  • Target the shadow fleet. Blocking of foreign vessels moving Russian-origin oil, uranium, gas, coal, or arms in circumvention of sanctions—with unsafe or non-standard maritime behavior, absence of adequate P&I insurance, or price-cap evasion as listed indicia—and of the owners, operators, managers, insurers and reinsurers, senior crew, and even foreign port operators that service them. Designation by the UK, EU, G7, or a Five Eyes member may be treated as prima facie evidence. Overall, the bill provides roughly a dozen designation grounds related to owning, managing, or servicing such vessels.[^22]
  • Raise duties on Russian goods to up to 500 percent ad valorem, in addition to all other applicable duties.[^23]
  • Impose duties of up to 100 percent on third countries that are among the five largest importers of Russian crude or gas and make new purchases, or among the top five facilitators of Russian oil sanctions evasion. A country is carved out if its Russian gas imports were under 15 percent of Russia's total gas exports and it is meaningfully reducing them. USTR re-evaluates the lists every 180 days and must give Congress ten days' written justification before imposing or adjusting a rate.[^24]

Note the tariff figures: the 500 percent ceiling applies to goods imported from Russia; the third-country ceiling is 100 percent.[^23][^24]

Exceptions and off-ramps. Title I carves out humanitarian and agricultural trade, intelligence and law enforcement activity, international-obligation admissions, civil nuclear cooperation and certain low-enriched uranium and medical isotope imports, official government business, non-Russian oil transiting Russia, vessel and crew safety, and NASA activity. Existing Treasury general licenses are expressly preserved, and Treasury retains authority to extend or issue new ones. There is a 270-day winddown and divestiture window for operations in Russia.[^25] The President may waive any sanction, restriction, or duty upon written certification to Congress that the waiver is in the national interest, with a supporting report.[^26] Termination requires certification that Russia has signed a peace agreement accepted by Ukraine and ceased hostilities, and is subject to a 30-day congressional review period (60 days for reports submitted between July 10 and September 7) with an expedited joint-resolution-of-disapproval mechanism.[^27] Penalties track IEEPA—the same civil and criminal exposure as any other IEEPA-based program.[^28]

Limiting the President's authority to remove certain sanctions. The bill requires sanctions and other measures imposed under the executive orders addressing the Russia national emergency—Executive Orders 14024, 14066, 14039, 14068, 14071, 14114, 14329, and 14384—that are in effect on the day before enactment to remain in effect.[^29] Separately, section 117 allows the President to terminate sanctions imposed pursuant to this bill if certain conditions are met and certified to Congress. Congress has the opportunity to block a proposed termination by passing a joint resolution of disapproval.[^27]

Iran. At the President's request, the substitute adds a one-line Title II provision amending section 13(b) of the Iran Sanctions Act of 1996 to strike "2026" and insert "2031," preventing a lapse in secondary sanctions authority over Iran's energy and weapons sectors.[^30]

A five-year sunset. The substitute terminates the entire Act—everything except the Iran extension—five years after enactment.[^31] This is new relative to S. 5025.

How likely is it to pass?

More likely than at any point in the bill's history, though not yet done.

The 86–12 cloture vote and the 84–12 motion to proceed drew nearly the whole Senate, with only one Republican opposed.[^7][^8] President Trump has publicly backed the package after negotiating its terms and requesting the Iran provisions.[^32] S. 5025 itself carries more than 60 cosponsors.[^4]

Two frictions remain. First, some Democrats object to the breadth of the tariff delegation; Senator Peter Welch (D-VT), who voted against advancing the measure, argued that the definition of a sanctions-evasion "facilitator" lacks specificity and amounts to a broad transfer of congressional tariff authority to the executive.[^33] Amendments narrowing that authority are the most likely source of change to the final text. Second, the House does not return until after the August recess, and House passage (plus reconciliation of any differences) must happen before anything reaches the President.[^9]

Overall, passage in some form looks probable, and the section list above is a reasonable planning baseline. The tariff provisions in sections 112 and 113 are the most likely to move; Title I's financial-sector and shadow-fleet provisions have been stable across every version since April 2025.

How may it impact my business?

First, it is important to note that this bill, if passed as it stands, will not automatically lead to the imposition of the sanctions it prescribes. It requires the President—who will delegate the required tasks to his cabinet, most probably a mix of the Secretaries of State, the Treasury, and Commerce—to impose those sanctions. The executive branch may end up not imposing any of them, for two reasons:

  1. Many of the "required" sanctions leave to the President the determination of whether a person falls within the activity described in a given designation ground; and
  2. Section 115 gives the President authority to waive the application of any sanctions provision with respect to a foreign person, any restriction with respect to a person, or any duty under Title I. Under the current version of the bill, Congress has no power to stop such a waiver.[^26]

This means the executive branch may or may not impose any of these sanctions. The administration could arguably impose all of the prescribed measures even without this bill. That said, if it becomes law, the bill will give the administration additional leverage against Russia and against countries that are major importers of Russian oil or gas.

Second, the bill indicates that many in the U.S. government (government in its wide meaning that includes legislative branch) are keen to impose more sanctions against Russia. Businesses that engage with Russia should factor that in. It suggests that a future administration may take a harsher stance on Russia, and any long-term engagement must account for that possibility.

Third, the risk of engaging with Russia remains high. Some expected the current administration to roll back some of the sanctions against Russia. While we see occasional State Department readouts of calls with the Russian foreign minister, and even the Alaska summit between President Trump and President Putin, sanctions risk has not subsided. Although the Trump administration has not issued large tranches of Russia designations akin to those of the Biden administration, the UK, or the EU, it has shown it is not afraid to act: in October 2025 it designated Rosneft and Lukoil, Russia's two largest oil companies, which the Biden administration had left untouched.[^34]

What can I do to manage the new risk?

  1. Review any Russia-related activity you have against the designation grounds and prohibited activities in this bill, and be prepared to wind them down if necessary.
  2. If you are still conducting business with Russia:
    1. Consider short-term rather than long-term engagements.
    2. Review and strengthen the sanctions clauses in your agreements where possible. The goal should be clauses that allow you to terminate based on the threat of sanctions, not only on actual prohibited activity. Such clauses must also account for Russian countermeasures.
    3. Avoid choosing Russian law as the governing law, or Russia as the place of dispute resolution, where possible.
    4. Pay attention to OFAC's recent guidance on sham transactions to avoid violating sanctions or engaging in sanctionable activity.[^35]
  3. Keep track of the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026.
  4. Contact Sanctrust if you:
    1. Have questions or need tailored sanctions analysis;
    2. Need sanctions training;
    3. Want to review your sanctions clauses; or
    4. Wish to assess the quality of your sanctions compliance program.

Endnotes

[^1]: S. 1241, 119th Cong. (introduced Apr. 1, 2025), sponsor Sen. Lindsey Graham (R-SC), read twice and referred to the Committee on Banking, Housing, and Urban Affairs. U.S. Gov't Publ'g Office, BILLS-119s1241is, https://www.govinfo.gov/app/details/BILLS-119s1241is.

[^2]: GovTrack.us, S. 1241—119th Congress: Sanctioning Russia Act of 2025 (84 cosponsors: 42 Democrats, 41 Republicans, 1 Independent), https://www.govtrack.us/congress/bills/119/s1241.

[^3]: Press Release, Sen. Lindsey Graham, Graham Statement on Russia Sanctions Bill (Jan. 7, 2026), https://www.lgraham.senate.gov/public/index.cfm/2026/1/graham-statement-on-russia-sanctions-bill.

[^4]: S. 5025, 119th Cong. (introduced July 16, 2026), sponsor Sen. Darline Graham (R-SC), with Sens. Blumenthal, Wicker, Shaheen, Grassley, Whitehouse, Risch, Coons, Cotton, Durbin, Britt and others; referred to the Committee on Banking, Housing, and Urban Affairs. U.S. Gov't Publ'g Office, BILLS-119s5025is, https://www.govinfo.gov/content/pkg/BILLS-119s5025is/xhtml/BILLS-119s5025is.html.

[^5]: H.R. 5334, 119th Cong., the Supporting Early-childhood Educators' Deductions Act (SEED Act)—"[t]o amend the Internal Revenue Code of 1986 to allow early childhood educators to take the educator expense deduction"—received in the Senate April 28, 2026 and placed on the Senate calendar (Cal. No. 454) July 14, 2026. GovTrack.us, https://www.govtrack.us/congress/bills/119/hr5334/text.

[^6]: Amendment in the Nature of a Substitute to H.R. 5334, intended to be proposed by Ms. Graham (for herself and Mr. Blumenthal), 119th Cong., 2d Sess. (draft dated July 27, 2026) [hereinafter "Substitute"], § 1(a) (short title: "Lindsey O. Graham Sanctioning Russia and Iran Act of 2026"), https://www.blumenthal.senate.gov/imo/media/doc/2026-07-27_bill_text.pdf.

[^7]: Senate Cloakroom, Motion to invoke cloture on the motion to proceed to Cal. No. 454, H.R. 5334, legislative vehicle for the Lindsey O. Graham Sanctioning Russia Act of 2026, invoked 86–12 (July 28, 2026); see also Stef W. Kight, 86 senators vote to move forward with Graham Russia sanctions bill, Axios (July 29, 2026), https://www.axios.com/2026/07/29/senate-russia-sanctions-lindsey-graham.

[^8]: John M. Donnelly, Senate weighs next steps on Russia-Iran sanctions, Roll Call (July 29, 2026), https://rollcall.com/2026/07/29/senate-weighs-next-steps-on-russia-iran-sanctions/ (Senate agreed 84–12 to the motion to proceed).

[^9]: US Senate Advances Landmark Russia Sanctions Bill After Zelenskyy's Capitol Appeal, RFE/RL (July 29, 2026), https://www.rferl.org/a/zelenskyy-united-states-senate-bill-sanctions-russia/33817262.html (House not scheduled to return until after the August recess).

[^10]: Cong. Research Serv., Summary of S. 1241, 119th Cong., https://www.congress.gov/bill/119th-congress/senate-bill/1241 (sanctions contingent on a presidential determination regarding refusal to negotiate, violation of an agreement, renewed invasion, or subversion of the Ukrainian government).

[^11]: Substitute §§ 102–113 (compliance dates keyed to enactment, generally 30 days, with 180-day review cycles); id. §§ 115, 117 (waiver and termination). Title I of the Substitute is materially identical to Title I of S. 5025 as introduced.

[^12]: Substitute § 102(a)–(b), (e). The count of 27 designation grounds reflects the enumerated bases in § 102(b)(2)(A)–(H), counting each item category in subparagraph (A) separately.

[^13]: Substitute § 103(a)–(d).

[^14]: Substitute § 104.

[^15]: Substitute § 105.

[^16]: Substitute § 106.

[^17]: Substitute § 107.

[^18]: Substitute § 108.

[^19]: Substitute § 109.

[^20]: Substitute § 110.

[^21]: Substitute § 111.

[^22]: Substitute § 102(b)(3)–(6), (c).

[^23]: Substitute § 112.

[^24]: Substitute § 113(a)–(g).

[^25]: Substitute § 114(a)–(k); see especially id. § 114(h) (general licenses preserved), (i) (270-day winddown).

[^26]: Substitute § 115. Unlike § 117, § 115 contains no congressional review or joint-resolution-of-disapproval mechanism.

[^27]: Substitute § 117(a)–(c).

[^28]: Substitute § 116 (incorporating the penalties in section 206(b)–(c) of IEEPA, 50 U.S.C. § 1705).

[^29]: Substitute § 102(d) (preserving measures under any executive order issued to address the national emergency continued by the President on March 24, 2026, 91 Fed. Reg. 15515). That continuation notice identifies the national emergency declared in Executive Order 14024, expanded by Executive Order 14066, and with respect to which additional steps were taken in Executive Orders 14039, 14068, 14071, 14114, 14329, and 14384. Continuation of the National Emergency With Respect to Specified Harmful Foreign Activities of the Government of the Russian Federation, 91 Fed. Reg. 15515 (Mar. 27, 2026), https://www.govinfo.gov/content/pkg/FR-2026-03-27/pdf/2026-06078.pdf.

[^30]: Substitute § 201 (amending section 13(b) of the Iran Sanctions Act of 1996, Pub. L. 104–172, 50 U.S.C. § 1701 note, by striking "2026" and inserting "2031").

[^31]: Substitute § 203 ("This Act (other than section 201) shall terminate on the date that is 5 years after the date of the enactment of this Act.").

[^32]: Anders Hagstrom, Lindsey Graham says Trump backs Russia sanctions bill, Fox News (Jan. 8, 2026); Senate advances broad sanctions on Russia and Iran following Lindsey Graham's death, The Hill (July 29, 2026), https://thehill.com/homenews/senate/5994964-senate-advances-russia-iran-sanctions/.

[^33]: Senate advances broad sanctions on Russia and Iran following Lindsey Graham's death, The Hill (July 29, 2026) (remarks of Sen. Peter Welch on the absence of specificity in the "facilitator" standard).

[^34]: U.S. Dep't of the Treasury, Office of Foreign Assets Control, designations of Open Joint Stock Company Rosneft Oil Company and Lukoil OAO and dozens of subsidiaries pursuant to Executive Order 14024 (Oct. 22, 2025). This was the first Russia-related designation action of the second Trump administration; Rosneft and Lukoil had been left off the SDN List when Gazprom Neft and Surgutneftegas were designated in January 2025.

[^35]: U.S. Dep't of the Treasury, Office of Foreign Assets Control, Sanctions Advisory, Guidance on Sham Transactions and Sanctions Evasion (Mar. 31, 2026), https://ofac.treasury.gov/media/935441/download.