Captagon Act: Can the United States Strangle the Assad Regime Financially?

As happened in previous years, the United States is still far from exerting more efforts to impose a political solution in Syria, in light of its position rolling from the illegitimacy of the Assad regime and the need to overthrow it, to change and improve its behavior.

After the Russian invasion of Ukraine, it seemed that the United States intended to get more involved in the Syrian file and declared March 2022 a month to hold the Assad regime accountable while it continued its main stability under the auspices of the Syrian Democratic Forces (SDF), and it excluded the east of the Euphrates and some areas of northern Syria from Caesar’s sanctions.

However, the United States, at the end of 2022, issuing the law to dismantle the Captagon networks linked to the Assad regime appears to be a significant development and a positive indication of activating its role in the Syrian issue, according to analysts, despite what this means in terms of questions about the purpose of the law, and is it to put pressure on the Assad regime to submit to US projects in Syria, or to put pressure on Vladimir Putin through his ally Bashar al-Assad, in addition to what will the Syrians benefit from it?

 

Assad’s Captagon Trade

The White House recently announced that US President Joe Biden signed the 2023 National Defense Authorization Act (NDAA) introduced by Congress, which includes a project aimed at curbing the Syrian regime’s expansion into the drug trade, in a move that would tighten the screws on the sources of funding for the Bashar al-Assad regime, and impose more political isolation on it.

According to the statement issued on December 23, 2022, the drug trade linked to the Assad regime is considered a transient security threat, which requires US agencies to develop a written strategy, within a maximum period of 180 days, to disrupt and dismantle the drug production and trade network linked to the Assad regime in Syria and neighboring countries.

The law also includes a financial grant of $400 million to the customs and border protection authorities in the countries allied to the United States in the region, including Jordan, Lebanon, Egypt, and Tunisia, which are countries that Assad’s Captagon reaches, whether for consumption or transit to other countries.

The new US legislation in 2023 grants military aid to the Iraqi government, as well as support and training for Washington’s allies in Syria (the SDF) in the face of ISIS, according to a US Department of Defense statement.

Last July, a number of US lawmakers from the Republican and Democratic parties, from the House of Representatives and the Senate, demanded that the Biden administration include Syria on the list of countries that produce or facilitate the passage of drugs, according to the Foreign Assistance Act of 1961.

Republican French Hill and Democrat Brendan Boyle are among the most prominent responsible figures in the United States who have pushed, during the recent period, for the passage of the Captagon Law, as well as the American Coalition for Syria (ACS).

In turn, French Hill said in a press statement posted on his personal website: “I am proud of this accomplishment and will continue to work tirelessly to prevent the Assad regime from furthering their influence and the international prevalence of Captagon.”

The representative warned that Assad’s Captagon had reached Europe and that it was only a matter of time before it reached the United States.

“In addition to regularly committing war crimes against his own people, the Assad regime is now becoming a narco-state,” he added.

Rep. Hill revealed that the anti-narcotics law of the Assad regime had been ratified by Congress in December 2021, but the negotiations of the conference committee led to its deletion later.

On its part, the ACS welcomed the new law and said in a statement: “The Captagon trade gives the Assad regime more money than all of its other exports combined.”

“By using elite members of the Syrian army led by Maher al-Assad to oversee the systematic production and distribution of Captagon, Bashar al-Assad managed to spread the drug to Europe, Asia, and Africa,” it added.

 

New US Strategy

Since US President Joe Biden signed the Captagon Act linked to the Syrian regime, questions about the extent of the impact of this law have not ceased.

In turn, Dr. Radwan Ziadeh, senior fellow at the Arab Center Washington DC (ACW), explained in a statement to Al-Estiklal that “the new American law focuses on curbing the financial revenues that the Assad regime obtains from the Captagon trade.”

“The law is also likely to include imposing sanctions on those who use this destructive illegal trade, and to put pressure on countries that have normalized relations with the Assad regime, such as Jordan and the UAE, and force them to beware of being a passage for drugs,” he added.

Meanwhile, the Syrian writer and dissident Ayman Abdel Nour said that the strategy developed by the competent American authorities aims to strike drug networks, starting from the stage of importing the necessary raw materials, which mostly come from China, through the stage of industrialization inside Syria, up to the stage of drug smuggling through the Syrian land and sea ports.

The new American strategy is to contribute to reducing the quantities of drugs sold by the Assad regime and thus reduce the financial revenues the Syrian regime reaps, which will naturally deepen its economic crisis, Abdel Nour said.

He also explained that the Syrian regime had established fake pharmaceutical factories so that it could import the raw materials needed for the drug industry legally and under the guise of the pharmaceutical industry.

On his part, Mr. Saad al-Sharae, researcher at the Al-Sharq Center for Studies, indicated in a statement to Al-Estiklal that he does not expect the new US law to eliminate the drug trade practiced by the Assad regime because it has turned Syria into the most important production and export center in the world over the past years, which cannot be undermined in the short term, adding that “Iran and its militias are also part of the Captagon trade manufactured in Syria.”

In another context, the researcher explained that “the United States over the past years was not in its strategy to overthrow the Assad regime, but was seeking to change its behavior and cooperate with it to reduce Iran’s influence in the Middle East.”

“In my opinion, this American belief is wrong, because Iran is the one who operates and implements in Syria without any regard for the regime,” Mr. al-Sharae said.

According to observers, it is still too early to ascertain the direction that the Biden administration will take in dealing with the law and whether it will benefit from it to further engage in the Syrian file by developing a hard-line strategy or will it evade its political goals that the lawmakers wanted.

 

Narco-State

In December 2021, a report by The New York Times newspaper revealed that the activities of the Syrian regime in drug manufacturing and trafficking have contributed to doubling the number of drugs seized globally dozens of times.

The newspaper said at the time that more than 250 million Captagon pills had been seized worldwide so far, more than 18 times the amount seized just four years ago.

Last June, an investigation by the German magazine Der Spiegel revealed the involvement of military units and close associates of the head of the Syrian regime in manufacturing and smuggling drugs to several countries, noting that drug revenues for the Assad regime amounted to $5.7 billion in 2021 alone.

According to international reports, law enforcement authorities around the world seized at least $3.5 billion in Captagon manufactured in Syria in 2020.

In an investigation published by the French newspaper Le Figaro last September, it was stated that Syria had become the largest producer of Captagon in the world and that Saudi Arabia is its first consumer, and Jordan and Lebanon are its corridors.

In December 2022, Agence France-Presse (AFP) said that Captagon pills had become Syria’s most prominent export, and its value exceeded all the country’s legal exports during the past two years.

It indicated that the Captagon trade represents a major source of income for the regime, which is facing a free economic fall in light of the collapse of its financial stock and the scarcity of fuel and basic commodities.

It quoted some of those involved in the trade as saying that it is one network, Syrian, Saudi, Lebanese, Iraqi, and Jordanian, pointing to the existence of commercial and clan relations and interests between the lines of smuggling and trade of Captagon between the regions and the country.

 

During the past few years, many countries of the world, especially in the Gulf region, have thwarted hundreds of drug shipments coming from areas controlled by the Assad regime.

On December 25, 2022, Jordan announced the seizure of 6 million Captagon pills on the border crossing that separates it from Syria, which is the largest number of those famous pills that have been announced as part of the ongoing Jordanian campaign for the second year in a row.

During the past months, Saudi Arabia had thwarted several attempts to smuggle drugs into its territory under the supervision of Syrians, and the Saudi Customs Authority had seized, during the year 2021, approximately 119 million Captagon pills.

The UAE, Iraq, and Kuwait were not far from these operations, as well as Lebanon, which is considered a market and a corridor at the same time.

 

Tough Sanctions

In a step to fill the legal loopholes that are being manipulated by the Assad regime and its officials subject to US sanctions, the Office of Foreign Assets Control (OFAC) of the US Treasury announced the amendment of some laws related to the shareholding in companies that are on the sanctions list.

According to the decision issued by the office on December 21, 2022, any company or person who shares in a company that has previously been sanctioned will be placed on the sanctions list, regardless of the shareholding percentage.

Previously, the law permitted any investor or shareholder in a penalized company to enter the company, provided that his share was less than 50%.

The former Syrian diplomat, Bassam Barabandi, described the new amendments as “a loophole that has been closed to tighten sanctions.”

“The new amendment no longer allows the foreign investor to participate, because the legal language has been amended and includes the indirect share, which is one of Asma and Maher al-Assad’s favorite ways,” he added.

Barabandi also indicated that the new amendment affects the project to deliver energy from Egypt and Jordan to Lebanon via Syria, as well as the Emirati, Kuwaiti, or other contributions to the Syrian companies that are subject to sanctions or their owners.

It is noteworthy that the Assad regime had worked with its allies to circumvent US and European sanctions in devious ways and methods, refusing to respond to international pressure because of their crimes.

Last March, leaked documents showed that close to the Assad regime licensed new companies inside Syria, with the main goal of complicating the process of tracing the ownership of companies linked to the regime’s supporters, according to the Guardian.

In September 2020, FinCEN files published by the American Buzzfeed News revealed the involvement of Maltese companies in facilitating transactions for the Assad regime to evade sanctions imposed by the United States of America on it.

In July 2020, a report by Global Witness also revealed the use of a Syrian-Russian network of unidentified companies in the European Union and British Overseas Territories to evade sanctions.