PROS AND CONS OF LISTING RUSSIA AS A STATE SPONSOR OF TERRORISM

A chorus of voices is pressing the Biden administration to place Russia on the U.S. State Department’s list of state sponsors of terrorism. Members of the U.S. Congress are lobbying Secretary of State Antony Blinken to make the listing, and both the Senate and the House of Representatives the higher and lower congressional houses  have introduced resolutions calling on him to do so, with Speaker of the House Nancy Pelosi describing the designation as “long overdue”. Should the U.S. make this designation, Russia would join a very small group of countries on a list that the U.S. government has traditionally reserved for those nations it considers pariahs  a designation that by all appearances is often based at least as much on overall enmity as on a country’s specific relationship to terrorism. The list presently includes Cuba, Iran, Syria and North Korea

Proponents of the state sponsor of terrorism designation hope it will further stigmatize and isolate Russia for launching a brutal war on its neighbor. But the concrete implications of a designation could be highly counterproductive – narrowing space for diplomacy if and when the moment for peace talks arrives, driving up already dangerously high tensions and impeding multilateral efforts to address conflict situations and humanitarian crises around the world.

Designation requires the Secretary of State to make a determination that a state has “repeatedly provided support for acts of international terrorism”. The three statutes that provide authority to make these designations do not comprehensively define “international terrorism”, although other legislation provides some idea of the parameters that apply. There is no requirement that the secretary of state designate every country that meets the relevant criteria or even that the states on the list be the most significant sponsors of international terrorism at a given time. Given the flexibility created by this statutory framework, policy and domestic political considerations, seemingly including some unrelated to counter-terrorism, appear to weigh heavily in the designation decision.

State sponsor designations are highly consequential, both legally and politically, and for this reason Washington typically avoids listing states with which it has multifaceted relations. A state sponsor of terrorism designation implicates two areas of law, sanctions and sovereign immunity. It triggers export controls for dual-use items - materials with both civilian and military uses; disallows U.S. arms sales and foreign assistance; and restricts access to debt relief and international financing. It also prompts other restrictions, which are unspecified in the statutes but which in other cases have coincided with increasingly severe sanctions that wind up applying to the entire economy and population of the listed country. The designation can trigger application of other miscellaneous sanctions laws that penalize entities and individuals engaging in certain types of trade with the sanctioned state.

A state sponsor of terrorism designation also limits a designated state’s entitlement to immunity under U.S. law. While the Foreign Sovereign Immunities Act generally shields foreign states from suits in U.S. courts, it provides that U.S. nationals (as well as U.S. government employees, contractors and service members) may sue designated countries for certain listed offenses, including torture, extrajudicial killing and hostage-taking. If they prevail, they can claim their award from the designated state’s blocked assets.  

In addition to the above penalties, the designation can result in a range of other nebulous, but consequential, effects. In part because it has so long been applied to countries that the U.S. in effect deems outcasts, the listing carries a greater stigma than other sanctions. U.S.-based businesses and non-governmental organizations may assume that any engagement with or in a designated state is off limits, even for activities that are technically allowed. Non-U.S. firms may also be concerned that engagement will expose them to legal action in the U.S., especially if they have U.S.-based operations or personnel. Often, firms find it difficult to obtain sufficient clarity on the legality of engagement to feel confident investing. Legal implications aside, the reputational risks of being tied to a country formally designated by the U.S. as supporting terrorism are so high that many businesses steer clear of states with this label without investigating the technicalities.

Designations tend to stick, partly because rescinding a country’s designation as a state sponsor of terrorism can be a politically fraught process with rigorous requirements. It requires the U.S. president to submit a report to congressional leaders affirming that the concerned state has either 1) undergone a fundamental change in leadership and policy, ceased supporting acts of international terrorism and provided assurances that it will not abet such acts in the future or 2) refrained from supporting international terrorism during the preceding six-month period and provided assurances that it will not resume supporting them in the future. Congress can block a proposed rescission, but only by introducing a joint resolution, which the president can veto. (Congress can overcome the veto but doing so requires a two-thirds majority in both Houses, which is an extremely high bar.)

Those arguing for the U.S. to designate Russia as a state sponsor of terrorism say doing so would send a powerful message of support to the Ukrainian government and people. While some proponents believe the move would be largely symbolic, others predict it would have “severe” economic effects and see that as a reason to designate Russia, arguing that such a drastic step may be the only tool strong enough to affect President Vladimir Putin’s behavior. Both camps tend to agree that the U.S. should use every weapon in its non-military arsenal to punish Russia for its crimes in Ukraine. Many also hope that where avenues for accountability are lacking, the legal routes that the designation opens for claimants in U.S. courts can be a first step toward securing justice for victims.

While Russia’s actions in Ukraine are the impetus for their push, advocates make a much broader case for designation. They argue that over the years Moscow can be viewed to have met the statutory requirements by consorting with groups engaged in political violence (whose actions would therefore constitute terrorism by some criteria), helping their supporters and engaging in activities that themselves should be seen as international terrorism. By way of evidence, they point to the presence of Russian combat troops in and supporting Syria, a designated state sponsor of terrorism; Russian development and support of separatists in eastern Ukraine’s Donbas region since 2014; the alleged poisoning by Russian operatives of political enemies abroad; and Russia’s use of the Wagner Group, a private security company accused of violence against civilians in Libya, Sudan and elsewhere, to further its foreign policy goals. Others have pointed to its conduct in prosecuting wars in Chechnya and Georgia. Proponents argue that with this track record, Russia should have been designated a long time ago.

But the issues presented by the Russian situation are not so straightforward. While Secretary Blinken likely has the ability within the flexible parameters of the relevant authorities to designate Russia, if he did so he would muddy U.S. practice concerning what it does and does not consider to be terrorism, which already suffers from some inconsistency. (The struggle to define terrorism consistently is not unique to the U.S.) The traditional U.S. approach to terrorism-related designations typically distinguishes terrorism from the conduct of hostilities by state security services – which is at the core of much of the evidence cited above even when such conduct might violate the laws of war. The concern is that doing so would establish a precedent and expose the U.S. and its partners to similar kinds of designations by adversaries in the future.

Stretching U.S. practice to designate Russia as a state sponsor of terrorism could fuel Moscow’s claims of the designation’s illegitimacy and could also make it more difficult to defend a rescission of the designation should the U.S. at some stage wish to take that step in order to advance a peace effort. It may also invite future pressure to use the designation authority on a broader range of states, with all the risks that would entail.

There is little to suggest that designating Russia a state sponsor of terrorism will dissuade Moscow from its current course in Ukraine or anywhere else. Russia is already enduring some of the most sweeping sanctions ever imposed – and the sanctions are still being ratcheted up. Western states have condemned Russia’s actions in Ukraine, multilateral bodies have censured the Kremlin and the International Criminal Court is investigating possible war crimes. While the desire to find new ways to pressure Moscow into ending the war or deter it from committing further atrocities is entirely understandable, there is little to suggest that this move will do either.

But the designation could still have substantial impact particularly should the parties reach the point where they are ready for peace talks. Unfortunately, that impact could well be negative. While Western powers will likely be reluctant to rescind all of the sanctions they have applied since the first Ukraine invasion in 2014, Russia will almost certainly insist that some be rolled back, and Crisis Group has recommended that Ukraine’s partners be prepared to take some measured steps. Synchronizing sanctions relief with the terms of a future peace deal will already be extremely challenging but the state sponsor designation would add a big obstacle. Russia will surely want to see it rescinded as part of any deal both because of its symbolism and because its persistence would make even partial economic normalization much more difficult.

A U.S. presidential administration supportive of a future Russia delisting would have to win the support of a public whose impressions of the Kremlin would be shaped both by the atrocities committed in Ukraine and by the framing of Russia as a terrorist state. Even if it lacks the votes to block delisting, Congress could create major political friction if it is not on board. If the U.S. stretches traditional parameters to make the designation based on a broad range of past Russian transgressions, any removal will likely be judged by whether Russia has stopped meeting those expanded criteria. That will be a difficult bar to clear, as the Kremlin is unlikely to radically change its behavior. Given that other countries might follow Washington’s lead by issuing their own designations, a delisting could be further encumbered by additional diplomatic coordination.

Opening up the U.S. courts to lawsuits against Russia could also have negative implications for the Ukraine conflict. As part of any future peace deal, Russia, if it has any standing to do so, is likely to insist upon the unfreezing of some if not all of its assets. That process would be much more complicated, and potentially impossible, if those assets were to be implicated in judicial awards or ongoing litigation. It is entirely possible that U.S. claimants will find a basis for pursuing legal action in the event Russia loses its sovereign immunity because of designation, not least because U.S. citizens have been killed in Ukraine. Frozen Russian assets could become politicized, with U.S stakeholders lobbying for their disbursement to U.S. victims instead of in service of a potential peace deal or reconstruction plan. Providing damages to U.S. nationals from frozen Russian assets could also deprive Ukrainian victims of a source for future compensation or reparations that might be awarded as part of a peace deal or by an international tribunal.

A designation may also make it harder for actors to be nimble in striking arrangements like the UN-backed deal recently signed by Ukraine and Russia to facilitate grain exports. It could also undermine implementation of this and other similar arrangements if businesses and aid organizations fear that carrying or distributing Russian-sourced commodities exposes them to legal, political and reputational risks. While such concerns may be addressed through the issuance of waivers, such bureaucratic hurdles and perceived risks have traditionally had a chilling effect.

While designation would be intended to send a bracing signal of condemnation to Moscow, the message it sends could have more troubling dimensions. Moscow will at one level find the designation deeply insulting, not least because it views itself as at the forefront of countering terrorism. Thus, the Russian foreign ministry has threatened to break off diplomatic relations with the U.S. if such a decision is taken. Even more worrying is the prospect that President Putin could regard this move as an overt call for a change in Russia’s government particularly given that one of the two statutory paths to rescission involves a change in the designated country’s leadership. U.S. President Joe Biden has explicitly said that the U.S. is not looking to force Putin from power. Yet this designation would give Putin something concrete to point to in disputing that claim, feeding his sense of grievance against the West and the related risk of confrontation.

Listing Russia as a state sponsor of terrorism would also hamper international cooperation on global conflict and crisis management. Security Council dynamics are already strained due to the deterioration of great-power relations and Russia’s invasion of Ukraine. The unprecedented designation of a permanent Security Council member may lead to more and worse complications. Such a move would also likely debilitate the Organization for Security and Co-operation in Europe, a body which has been instrumental in containing the conflicts that erupted after the Soviet Union dissolved. Multilateral gridlock would also have implications outside the Council, including in peace negotiations where Russia and the West have a common interest in stabilization or even resolution. Existing processes such as the 5+2 talks in Moldova, the Geneva International Discussions on Georgia, negotiations on Nagorno-Karabakh and UN-led dialogue regarding Libya would be at acute risk. Prospects for negotiations leading to settlements elsewhere, such as in Syria or Mali, would become even bleaker.

Given the size of Russia’s economy, the shocks of such a development to an already fragile global economy could be severe. Russia’s partners in the Eurasian Economic Union (Armenia, Belarus, Kazakhstan and Kyrgyzstan) are already concerned that a designation could lead the union, and the free trade zone within it, to collapse. These developments could destabilize Central Asian countries and Armenia and could also shake up Georgia, Türkiye and even some European Union member states whose economies have strong links to the Russian economy.

Designation might be a powerful display of support for Ukraine, and an answer to President Zelenskyy’s pleas, but it is unlikely to persuade Russia to end or reverse its aggression or deter atrocities. The modest benefits it offers pale before its potential costs, which could include a lower bar for escalation from a Russian government that sees the U.S. as bent on its ouster. While meaningful diplomatic efforts to stop the fighting may seem far away, when and if the day arrives, a designation would create serious obstacles. Meanwhile, it would surely lead to a further deterioration in the capacity of U.S. and Russian diplomats to work together in multilateral forums, where some collaboration around conflict prevention and humanitarian support for crisis-affected regions has quietly continued even in the aftermath of Russia’s invasion. If designating Russia a state sponsor of terrorism were a purely symbolic act, as some proponents suggest, then there would be little or no cause for concern beyond worries about appearing ineffectual. But a designation would not be simply an expression of opprobrium: it would inject additional risk into a situation that is already tremendously perilous. The U.S. administration has been wise to resist efforts to push it in this direction. It should continue to do so.