Venezuela’s Commercial Reopening: New Oil Regulations, Expanded Sanctions Authorizations and Heightened Compliance Expectations

Venezuela’s legal and commercial environment is entering a new phase. Recent hydrocarbons reforms and implementing regulations have expanded opportunities for private participation across the oil value chain, while the United States has issued a series of general licenses permitting defined categories of energy, minerals, financial-services and investment-related activity.

These developments may create meaningful opportunities for Venezuelan businesses seeking foreign capital, technology, services, financing and access to international markets. They do not, however, represent a complete removal of U.S. sanctions or the elimination of Venezuela’s broader legal, political and compliance risks. Transactions involving Venezuelan state entities, sanctioned parties, international payment systems or U.S.-origin goods and technology remain subject to overlapping sanctions, export-control, anti-corruption, anti-money-laundering and contractual requirements.

Venezuelan companies should therefore approach the reopening through an integrated “Business Integrity framework”, combining commercial strategy with sanctions analysis, corporate governance, counterparty due diligence, financial transparency and dispute-resolution planning.

1. Venezuela Opens the Oil Sector to Greater Private Participation

On January 29, 2026, Venezuela partially amended its Organic Hydrocarbons Law to help revive the oil industry, update the legal framework, and attract private investment. The reform broadened private companies’ participation in exploration, extraction, gathering, initial transportation, and storage, while preserving state ownership of hydrocarbon deposits.

In July, the government published implementing regulations addressing private-sector participation throughout a broader portion of the petroleum value chain, from upstream operations to refining, commercialization and distribution. According to reports, the regulations establish a more flexible fiscal structure intended to reflect the characteristics and risk profile of individual assets and projects. The regulations also reportedly do not place PDVSA at the center of every authorized activity, representing a significant departure from the state-dominated model that governed the industry for decades.

Key implications for Venezuelan businesses

The emerging framework may facilitate:

i. Direct participation by Venezuelan and foreign private companies in oil-sector projects.

ii. New joint ventures, operating agreements, service arrangements and commercial partnerships.

iii. Private involvement in refining, transportation, marketing and distribution.

iv. Renegotiation or restructuring of legacy agreements.

v. Greater access to foreign technology, equipment, expertise and capital.

The opportunity is substantial, but the legal foundation of each project must be independently verified. Companies should confirm corporate authority, governmental approvals, licenses, concessions, tax treatment, environmental obligations and the enforceability of contractual rights under Venezuelan law.

2. U.S. Sanctions Relief Is Expanding—but Remains Conditional

The U.S. sanctions framework remains the single most important external legal consideration for Venezuelan businesses with U.S. counterparties, U.S. dollar transactions, U.S.-origin goods or technology, or access to the U.S. financial system.

During 2026, the U.S. Department of the Treasury's Office of Foreign Assets Control (OFAC) issued and amended a series of Venezuela-related General Licenses authorizing defined categories of commercial activity involving the energy, mining, financial services, aviation and debt restructuring sectors. Current authorizations include, among others, General Licenses 46C, 47A, 48B, 49A, 50B, 51B, 52A, 54A, 56, 57, 58, 59 and the recently issued General License 60.

General License 60: Humanitarian Response Following the June 2026 Earthquake

A significant recent development is General License 60, issued on June 25, 2026, which temporarily authorizes transactions that would otherwise be prohibited under the Venezuela Sanctions Regulations when they are related to earthquake relief efforts in Venezuela. The authorization, currently effective through October 23, 2026, permits a broad range of humanitarian and reconstruction-related transactions, including the processing of funds by U.S. financial institutions in support of authorized relief activities. Importantly, GL 60 also authorizes the payment of taxes, fees and other government charges directly associated with those humanitarian operations.

Although GL 60 is limited to earthquake relief and reconstruction activities, it demonstrates the U.S. Government's willingness to adopt targeted, sector-specific authorizations where humanitarian and broader U.S. foreign policy objectives align.

CAF Launches Venezuela Recovery and Reconstruction Fund

Complementing these regulatory developments, CAF – Development Bank of Latin America and the Caribbean established the Venezuela Recovery and Reconstruction Fund following the June 2026 earthquakes. CAF contributed USD 1 million in seed capital to launch the initiative, which is designed as a transparent, multi-donor mechanism to mobilize contributions from governments, multilateral institutions, development agencies, private companies, foundations and other international donors in support of Venezuela's recovery and reconstruction priorities. The Fund's governing framework provides for an initial financing capacity of up to USD 200 million, with the possibility of future expansion as additional donor commitments are secured.

For companies operating in infrastructure, construction, engineering, logistics, healthcare, energy, telecommunications, financial services and professional services, the combination of General License 60 and the CAF Reconstruction Fund may create new opportunities to participate in humanitarian, reconstruction and resilient infrastructure projects, provided that each transaction is carefully evaluated under the applicable U.S. sanctions framework.

Sanctions Relief Does Not Eliminate Compliance Obligations

Despite these important developments, the core U.S. sanctions program against Venezuela remains in force. Transactions involving the Government of Venezuela, PDVSA, the Central Bank of Venezuela or other blocked persons continue to require a specific legal basis under an applicable General License or Specific License.

A general license is not blanket authorization

Each transaction must be tested against the exact terms of the applicable authorization, including:

• Eligible parties and entities.
• Authorized goods, services and activities.
• Payment routes and financial institutions.
• Reporting and recordkeeping obligations.
• Contractual provisions.
• Prohibited counterparties or jurisdictions.
• Ownership and control restrictions.
• Effective dates, expiration dates and amendment risk.

A transaction that appears commercially connected to an authorized sector may still be prohibited because of the identity of a counterparty, ownership by a blocked person, the source of goods or technology, the payment structure or the involvement of an unauthorized intermediary.

Accordingly, Venezuelan businesses should continue to evaluate every transaction individually, including:

• applicability of the relevant General License;
• ownership and control under OFAC's 50 Percent Rule;
• export control restrictions;
• payment routing and financial institution requirements;
• anti-money laundering and anti-corruption obligations;
• contractual protections; and
• enhanced due diligence on counterparties and intermediaries.

The broader trend is nevertheless significant.

Taken together, the expansion of sector-specific OFAC authorizations, the modernization of Venezuela's hydrocarbons framework, and the launch of the CAF Reconstruction Fund indicate an emerging policy environment that increasingly favors regulated private investment, reconstruction financing and carefully managed international commercial engagement, while maintaining robust compliance expectations for all market participants.

3. Financial Reconnection Creates Both Opportunity and Scrutiny

General License 57 permits certain financial-services transactions involving designated Venezuelan banks and government-related individuals, potentially restoring access to account services, transfers, correspondent banking and cross-border payments.

For Venezuelan businesses, improved access to international banking may facilitate trade, investment and operational payments. At the same time, international banks are likely to apply enhanced scrutiny before processing Venezuela-related transactions.

Companies should expect financial institutions to request:

• Complete beneficial-ownership information.
• Detailed source-of-funds and source-of-wealth documentation.
• Copies of contracts, invoices and shipping records.
• Evidence that the activity falls within an OFAC authorization.
• Identification of government or state-owned-enterprise involvement.
• Explanations of payment routes and intermediaries.
• Anti-money-laundering and anti-corruption certifications.
• Evidence of legitimate commercial purpose and economic substance.

Even authorized transactions may be delayed or rejected when documentation is incomplete or when the bank’s internal risk appetite is more restrictive than the applicable legal authorization.

4. Contracts Must Address Sanctions Volatility and Enforcement Risk

As business activity grows, disputes may become more frequent in areas such as construction, infrastructure, oil-field services, supply contracts, pricing, quality, delivery, project finance and offtake arrangements. Sanctions-related disputes may also arise if changes in U.S. policy delay or prevent performance.

Contracts involving Venezuelan businesses should address:

• Sanctions and export-control compliance.
• Changes in law or licensing status.
• Suspension and termination rights.
• Payment contingencies and blocked-funds procedures.
• Representations concerning ownership and designated parties.
• Government approvals and corporate authority.
• Anti-corruption commitments.
• Audit and information rights.
• Force majeure and hardship.
• Governing law.
• Arbitration and enforcement.
• Asset-location and judgment-enforcement considerations.

Choosing U.S. or other foreign law for a contract does not eliminate Venezuelan-law requirements that can affect the transaction. Companies should separately confirm corporate authority, signing capacity and any mandatory Venezuelan approvals before closing, as missing approvals can create execution risk, delay performance or undermine enforceability even where the agreement is governed by foreign law.

Because enforcement against the Venezuelan state and state-owned enterprises may be constrained by sovereign immunity and asset-attachment limitations, dispute planning should begin before the contract is signed.

5. Compliance Must Extend Beyond Sanctions

Venezuela remains a high-risk jurisdiction for corruption, money laundering, public-sector interaction and third-party misconduct. Companies operating through government agencies, PDVSA affiliates, state-owned enterprises, customs authorities, port operators, intermediaries or politically exposed persons may face exposure under multiple legal regimes.

These may include:

• The U.S. Foreign Corrupt Practices Act.
• The UK Bribery Act.
• U.S. anti-money-laundering laws.
• Sanctions and export-control regulations.
• Local anti-corruption and corporate laws.
• Contractual compliance standards imposed by banks and multinational counterparties.

Foreign investors and commercial counterparties will expect Venezuelan businesses to demonstrate a robust compliance infrastructure from the outset and maintain it throughout the relationship. In practical terms, this means having clear controls for screening sanctions, beneficial-ownership checks, third-party risk management, government interactions, payments, commissions, audit access, internal investigations and documented remediation. A well-documented program can reduce execution risk, support bank approvals and strengthen investor confidence.

6. Environmental and Climate Considerations Are Becoming Commercial Issues

The reopening of Venezuela’s energy sector also raises environmental, climate and infrastructure concerns. Historical analysis has highlighted the consequences of underinvestment, weak environmental enforcement, aging infrastructure and sanctions-evasion practices involving opaque traders and vessels.

Although that analysis predates the 2026 legal changes, the underlying policy issue remains relevant: renewed investment is likely to be evaluated not only on production and profitability, but also on environmental performance, methane emissions, remediation, worker safety, community impact and transparent revenue management.

Companies should therefore incorporate environmental and climate obligations into:

• Project due diligence.
• Asset-condition assessments.
• Environmental representations and indemnities.
• Remediation responsibilities.
• Insurance arrangements.
• Contractor oversight.
• Supply-chain standards.
• Sustainability reporting.
• Community and stakeholder engagement.

Recommended Immediate Actions

Venezuelan businesses considering new cross-border activity should:

i. Map ownership and counterparties. Confirm beneficial ownership, government connections, sanctions status and 50-percent-rule exposure.

ii. Identify the precise legal authorization. Do not rely on a general understanding that sanctions have been relaxed; document the specific general license, exception or specific license supporting the transaction.

iii. Conduct transaction-level due diligence. Review parties, banks, vessels, insurers, suppliers, products, technology, payment routes and end use.

iv. Strengthen corporate governance. Establish documented approval processes for state-related transactions, commissions, agents, consultants and high-risk payments.

v. Review contracts for sanctions resilience. Include change-in-law, suspension, termination, payment, audit and dispute-resolution provisions.

vi. Prepare a banking package. Maintain a readily available file containing ownership records, licenses, contracts, invoices, compliance certifications and source-of-funds documentation.

vii. Assess export controls separately. OFAC authorization does not automatically authorize the export or reexport of U.S.-origin goods, software or technology under applicable export-control laws.

viii. Integrate environmental and human-rights controls. Evaluate project impacts, labor conditions, environmental liabilities, security arrangements and supply-chain risks.

ix. Implement ongoing monitoring. Venezuela-related rules are evolving quickly, and transactions should be reassessed when licenses, counterparties or government policies change.

Key Takeaway

Venezuela’s commercial reopening should be understood as a controlled and conditional expansion of permissible business activity—not a return to ordinary-course commerce.

The combination of petroleum-sector reform, greater private participation and expanded U.S. licensing may create significant opportunities for Venezuelan businesses and international investors. Capturing those opportunities will require disciplined corporate governance, transparent financial structures, sanctions and export-control analysis, enhanced due diligence, carefully drafted contracts and credible Business Integrity programs.

Seyfarth’s cross-border team can assist Venezuelan and international businesses with market-entry strategy, sanctions and trade compliance, corporate structuring, third-party due diligence, internal investigations, contract design, international arbitration, employment considerations and broader Business Integrity frameworks.

This alert is provided for informational purposes only and does not constitute legal advice. The application of sanctions, export controls and Venezuelan law depends on the specific parties, transaction structure and facts involved.

References:

https://www.bloomberglinea.com/latinoamerica/venezuela/venezuela-publica-nuevas-reglas-petroleras-que-ponen-fin-al-control-de-pdvsa/  “Venezuela publica nuevas reglas petroleras que ponen fin al control de PDVSA”

https://ofac.treasury.gov/selected-general-licenses-issued-ofac “Selected General Licenses Issued by OFAC | Office of Foreign Assets Control”

https://www.caf.com/en/currently/news/caf-establishes-venezuela-recovery-and-reconstruction-fund/ “CAF establishes Venezuela Recovery and Reconstruction Fund”

https://iamericas.org/venezuela-sanctions-and-climate-action-a-fresh-approach “Venezuela sanctions and climate action — a fresh approach - Institute of the Americas”