22 USC § 8725 - Liability of parent companies for violations of sanctions by foreign subsidiaries

---
identifier: "/us/usc/t22/s8725"
source: "usc"
legal_status: "official_prima_facie"
title: "22 USC § 8725 - Liability of parent companies for violations of sanctions by foreign subsidiaries"
title_number: 22
title_name: "FOREIGN RELATIONS AND INTERCOURSE"
section_number: "8725"
section_name: "Liability of parent companies for violations of sanctions by foreign subsidiaries"
chapter_number: 94
chapter_name: "IRAN THREAT REDUCTION AND SYRIA HUMAN RIGHTS"
subchapter_number: "II"
subchapter_name: "ADDITIONAL MEASURES RELATING TO SANCTIONS AGAINST IRAN"
positive_law: false
currency: "119-84"
last_updated: "2026-03-26"
format_version: "1.1.0"
generator: "[email protected]"
source_credit: "(Pub. L. 112–158, title II, § 218, Aug. 10, 2012, 126 Stat. 1234.)"
---


# § 8725. Liability of parent companies for violations of sanctions by foreign subsidiaries

**(a)** **Definitions** In this section:

**(1)** **Entity** The term “entity” means a partnership, association, trust, joint venture, corporation, or other organization.

**(2)** **Own or control** The term “own or control” means, with respect to an entity—

**(A)** to hold more than 50 percent of the equity interest by vote or value in the entity;

**(B)** to hold a majority of seats on the board of directors of the entity; or

**(C)** to otherwise control the actions, policies, or personnel decisions of the entity.

**(b)** **Prohibition** August 10, 201250 U.S.C. 1701

Not later than 60 days after , the President shall prohibit an entity owned or controlled by a United States person and established or maintained outside the United States from knowingly engaging in any transaction directly or indirectly with the Government of Iran or any person subject to the jurisdiction of the Government of Iran that would be prohibited by an order or regulation issued pursuant to the International Emergency Economic Powers Act ( et seq.) if the transaction were engaged in by a United States person or in the United States.

**(c)** **Civil penalty** 50 U.S.C. 1705(b)

The civil penalties provided for in section 206(b) of the International Emergency Economic Powers Act () shall apply to a United States person to the same extent that such penalties apply to a person that commits an unlawful act described in section 206(a) of that Act if an entity owned or controlled by the United States person and established or maintained outside the United States violates, attempts to violate, conspires to violate, or causes a violation of any order or regulation issued to implement subsection (b).

**(d)** **Applicability** August 10, 2012

Subsection (c) shall not apply with respect to a transaction described in subsection (b) by an entity owned or controlled by a United States person and established or maintained outside the United States if the United States person divests or terminates its business with the entity not later than the date that is 180 days after .

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**Source Credit**: (Pub. L. 112–158, title II, § 218, Aug. 10, 2012, 126 Stat. 1234.)

### Termination of Section

For termination of section, see .

## Editorial Notes

### References in Text

The International Emergency Economic Powers Act, referred to in subsec. (b), is title II of , , , which is classified generally to chapter 35 (§ 1701 et seq.) of Title 50, War and National Defense. For complete classification of this Act to the Code, see Short Title note set out under  and Tables.