The US on Wednesday removed counterterrorism sanctions from Iraq's Fly Baghdad, reversing a previous designation on accusations it had supported Iran's Islamic Revolutionary Guard Corps.
A Treasury Department notice stated that sanctions were also removed from two Iraq-registered aircraft owned by Fly Baghdad, as well as two of its aliases. The airline's chief executive Basheer Abdulkadhim Al Shabbani remains under sanctions, with his listing now linked to the IRGC instead of Fly Baghdad.
A Treasury official said Fly Baghdad was removed after going through the Office of Foreign Asset Control's administration reconsideration process, and that the listing was no longer warranted after the airline demonstrated major changes to its operation.
“This is not indicative of any shift in US policy toward the government of Iran, the Islamic Revolutionary Guard Corps – Qods Force, any designated terrorist organisation, or any person who supports or acts on behalf of any of these,” the official said. "Today's removal was done as part of the normal administrative process upon review of the specifics related to FBA [Fly Baghdad Airlines]."
The airline was placed on the US sanctions list in 2024 over allegations that it had supported the IRGC and its auxiliary groups in Iraq, Syria and Lebanon by transferring hundreds of fighters across the region following the October 7, 2023 attack on Israel. The department had also sanctioned Kataib Hezbollah for allegedly moving and laundering funds for the proxy group, saying it had used Fly Baghdad to transport fighters, weapons and money.
The Iraqi government at the time ordered the cancellation of all Fly Baghdad flights pending an investigation.
Fly Baghdad's removal from the US's 17,000-plus sanctions list is the latest in the Treasury Department's efforts to streamline the programme. Treasury Secretary Scott Bessent in May launched a review of the US sanctions programme to remove outdated designations and ease compliance burdens for financial institutions.
“Sanctions should not linger so long that their intended effects create unintended consequences,” Mr Bessent said during remarks to his G7 counterparts in May.
The US Treasury last week removed an additional 84 companies and people from its sanctions list, including 33 Iraq-related firms that were first placed on the list in 1991 or 1992.
Fly Baghdad did not immediately return The National's request for comment.
