Barnes & Thornburg | Russia Sanctions and Tariffs: What Businesses Need to Know About the Graham Act

• New tariffs create immediate supply chain exposure. The Lindsey O. Graham Sanctioning Russia and Iran Act of 2026 (the Graham Act) authorizes duties of up to 100% on all goods from countries that are top-five purchasers of Russian energy or top-five facilitators of oil sanctions evasion. It also requires duties of up to 500% on Russian-origin goods, stacked on top of existing duties. The president’s first country determinations are due within 30 days of enactment, or about Oct. 18.
• Financial sector and banking exposure increases. New restrictions reach financial messaging providers, U.S. banks and broker-dealers, and mandatory secondary sanctions apply to foreign financial institutions that transact significantly with designated Russian banks. Companies should map their supply chains against the tariff provisions and review their non-U.S. banking partners.
• Executive order sanctions are now statute. Much of the existing Russia sanctions regime is codified, and lifting it requires a signed peace agreement accepted by Ukraine, certification to Congress, and a 30-day congressional review. Businesses should plan for durable restrictions, though the sanctions provisions sunset after five years unless renewed.

On Sept. 18, President Donald Trump signed into law the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026 (the Graham Act), which puts forward a comprehensive package of statutory sanctions and trade restrictions directed against Russia and persons engaged in activity with Russia. The Graham Act also extends the Iran Sanctions Act of 1996 through 2031.

The Graham Act notably creates significant new restrictions on business activity connected to the Russian Federation, including through the application of new tariffs, and codifies a substantial portion of the executive order-based Russia sanctions regime into statute. For businesses, the new sanctions and tariff measures may present the most immediate impact. However, the codification into law of many sanctions measures that previously existed only under executive orders raises a critical distinction for businesses. Executive order-based sanctions can be lifted by any sitting president with a stroke of the pen, but statutory sanctions require an act of Congress to be removed.

Under the Graham Act, termination of sanctions requires a signed peace agreement accepted by Ukraine, certification to Congress, and clearing a 30-day congressional review period. This means that businesses should plan on these restrictions being durable, long-term features of the commercial landscape, not temporary measures that may be reversed in the near term.

The Graham Act’s sanctions provisions sunset five years after enactment unless renewed, except for the Iran Sanctions Act extension, which runs through 2031.

Below we highlight the sanctions measures taken in the Graham Act that will have practical implications for businesses. Part 1 addresses measures that are new. Part 2 covers measures that codify existing executive order-based sanctions, making them significantly more durable.

Part 1: What’s New: Tariffs and Financial Sector Restrictions

The following provisions create authorities or obligations that go beyond what existed under the pre-enactment executive order-based sanctions and present new compliance challenges for businesses.

1. Up to 100% Tariffs on Countries Buying Russian Energy (§ 113)

The Graham Act authorizes duties of up to 100% on all goods imported into the United States from any country that is among the five largest purchasers of Russian crude oil or natural gas, or among the top five countries facilitating Russian oil sanctions evasion. These duties are imposed on a countrywide basis, meaning all goods from a designated country are affected, not just energy-related imports. The president must make initial determinations within 30 days of enactment and update them every 180 days.

Companies with supply chains running through India, China, Turkey, or other major purchasers of Russian energy face potential tariff exposure on all imports from those countries, regardless of whether the specific goods have any connection to Russia. Procurement, sourcing, and pricing strategies may need to account for duty rates that could change every six months.

2. Up to 500% Tariffs on Russian-Origin Goods (§ 112)

The Graham Act requires duties of up to 500% on all goods imported from Russia, including oil, natural gas, petroleum products, coal, and coal products. These duties are additive — they stack on top of any other applicable duties, including antidumping, countervailing, Section 232, and Section 301 duties.

Any residual trade in Russian-origin goods entering the United States is effectively eliminated at these tariff levels. Businesses importing commodities should confirm they have no Russian-origin inputs in their supply chain.

3. New Restrictions on Banks, Broker-Dealers and Financial Messaging (§§ 103(e), 105, 106, 110)

The Graham Act imposes several new restrictions on the financial sector. These include:

• Sanctioning any entity providing global financial messaging services that is knowingly used to circumvent U.S. sanctions on Russian financial institutions;
• Prohibiting U.S. depository institutions and broker-dealers from processing fund transfers to or from the Russian government, or for the direct or indirect benefit of Russian government officials;
• SEC prohibiting securities of Russian government-affiliated issuers from trading on U.S. national securities exchanges.
• Not requiring financial institutions holding immobilized Russian sovereign assets to return interest earned on those assets to Russia.

Together, these measures require heightened vigilance by financial institutions and investment managers in order to remain compliant with these new statutory sanctions.

Part 2: What’s Codified: Executive Order Sanctions Now in Statute

The following provisions largely replicate measures that already existed under executive authority but convert them to statutory mandates. While the substantive obligations for businesses may not change immediately, the codification makes these sanctions significantly more durable and difficult to unwind.

1. Blocking Sanctions on Russian Officials (§ 102(a)–(b)(1))

The Graham Act mandates blocking of the property and visa ineligibility of over two dozen named categories of Russian officials. Most of these individuals were already designated on the Office of Foreign Assets Control’s (OFAC)  Specially Designated National (SDN) List under executive orders.

2. Sanctions on Russian Defense Suppliers and Oligarchs (§ 102(b))

The Graham Act codifies and expands prior sanctions on foreign persons who provide specific defense-industrial goods to Russia. It also mandates sanctions against Russian oligarchs who have “not demonstrated opposition” to the war in Ukraine.

3. Shadow Fleet Vessel Designations (§ 102(b)(3)–(5))

OFAC had been designating shadow fleet vessels under existing authority. The Graham Act creates a statutory framework with enumerated criteria and allows the use of U.K./E.U. designations as prima facie evidence.

4. Blocking Sanctions on Russian Financial Institutions and Related Secondary Sanctions (§ 103)

The Graham Act codifies the blocking sanctions on the Central Bank of Russia, Sberbank, VTB Bank, Gazprombank, and all Russian government-owned financial institutions and adds CAATSA-menu sanctions and account restrictions. Secondary sanctions must be imposed on foreign financial institutions that engage in significant transactions with designated Russian banks.

5. Blocking of Russian Government-Owned Entities (§ 104)

Executive orders already authorized blocking of Russian government-affiliated entities. The Graham Act codifies this with a mandatory 180-day review cycle.

6. Ban on U.S. Person Investment in Russia (§ 107)

Executive Order 14071 prohibited new investment in the Russian Federation. The Graham Act codifies and expands this to include facilitation of foreign-person investment.

7. Russian Energy Sector Restrictions (§ 108)

The Graham Act’s energy sector investment prohibition and import-side restrictions largely track earlier executive orders and OFAC determinations. But notably, the Graham Act imposes new secondary sanctions on foreign persons who facilitate Russian energy production.

8. Ban on Purchase of Russian Sovereign Debt (§ 109)

Prior executive orders restricted U.S. person purchases of Russian sovereign debt. The Graham Act converts this to a statutory mandate.

Key Takeaways: Compliance Priorities Under the Graham Act

Businesses should treat the Graham Act’s restrictions as durable, long-term features of the commercial landscape. As an immediate priority, companies should map their supply chains against the tariff provisions (§ 113), which create tariff risk on all imports from countries that may be major purchasers of Russian energy, regardless of whether the specific goods have any connection to Russia. U.S. companies should also assess whether their non-U.S. banking partners have exposure to designated Russian banks, given the mandatory secondary sanctions on foreign financial institutions under § 103.

In the longer term, the codification of previous executive order-based sanctions, combined with termination provisions requiring a Ukraine peace agreement and congressional review, means these measures cannot be unwound through executive action alone and may be more durable.