OFAC removes Fly Baghdad and two aircraft from terrorism list

WASHINGTON, Aug. 5, 2026 — The US Treasury Department removed Iraqi airline Fly Baghdad and two aircraft operated by the carrier from the Specially Designated Nationals and Blocked Persons List.

The Office of Foreign Assets Control deleted listings for Fly Baghdad Airlines Company, also known as Fly Baghdad and Iraq Express, and Boeing 737 aircraft with Iraqi tail numbers YI-BAF and YI-BAN. OFAC did not provide a public explanation for the removals in its notice.

The action means the airline and the two aircraft are no longer blocked under the U.S. counterterrorism sanctions designation announced in January 2024.

OFAC retained Fly Baghdad Chief Executive Basheer Abdulkadhim Alwan al-Shabbani on the sanctions list. It updated his listing to link him directly to Iran’s Islamic Revolutionary Guard Corps-Quds Force rather than to Fly Baghdad. He remains designated as a specially designated global terrorist and subject to secondary sanctions risk.

Treasury originally sanctioned Fly Baghdad and al-Shabbani under Executive Order 13224, as amended, alleging that the airline had provided assistance to the IRGC-Quds Force and its regional proxy groups. U.S. authorities accused the carrier of transporting personnel, weapons and equipment through Iraq and Syria.

The 2024 designation required U.S.-controlled property belonging to the airline and its chief executive to be blocked and generally prohibited U.S. persons from conducting transactions with them. OFAC subsequently issued a temporary general license covering certain civil aviation safety and wind-down transactions involving the carrier.

The Aug. 5 action affects only Fly Baghdad and the two named aircraft. Al-Shabbani’s continued designation means his property and interests in property within U.S. jurisdiction remain blocked, and entities owned 50% or more by him are also generally blocked.