Country Risk Analysis: What does it mean to designate the “Cartel de los Soles” as a Foreign Terrorist Organisation?
Key implication: U.S.-based and other international companies operating in Venezuela could be subject to accusations of financially supporting a designated “Foreign Terrorist Organisation.”
On November 16, Secretary of State and National Security Advisor Marco Rubio announced that “the Department of State intends to designate Cartel de los Soles as a Foreign Terrorist Organization (FTO), effective November 24, 2025.”
The main implication is that companies paying taxes or otherwise making transactions with the Venezuelan state could be accused of financially supporting a designated “Foreign Terrorist Organisation.” This includes Chevron and other energy corporations, as well as potentially any company doing business in Venezuela.
This is because the Venezuelan state is under the control of the alleged leaders of the “Cartel de los Soles.” According to previous statements from the Trump administration, the organisation is alleged to be “a criminal group headed by Nicolas Maduro Moros and other high-ranking Venezuelan individuals in the Maduro regime that provides material support to foreign terrorist organizations threatening the peace and security of the United States, namely Tren de Aragua and the Sinaloa Cartel.”
The announcement is somewhat unconventional, by stating an intention rather than an accomplished fact. This signals that there might be some room left and that the President has not taken a final decision. In other, recent announcements, the same State Department says that it “is designating” or “has designated.”
In July, the Department of the Treasury sanctioned the “Cartel de los Soles” as a Specially Designated Global Terrorist (SDGT). However, this was essentially a symbolic gesture with no practical effects. No new individuals or entities were added to the sanctions list —alleged members of the Cartel, like Maduro, are already sanctioned. The new FTO designation, however, means that individuals and organisations can be prosecuted for financially supporting terrorism.
Background: New round of negotiations starting?
On the same day that Secretary Rubio made the announcement, we heard President Trump saying that there could be talks underway with the Maduro government: “We may be having some discussions with Maduro, and we'll see how that turns out — but they would like to talk.”
Envoys from the two heads of state have engaged in negotiations before, including to deport Venezuelan migrants in the U.S., free U.S. citizens and Venezuelan political prisoners, and to settle on a new sanctions waiver for energy giant Chevron.
It should be no surprise if President Trump were to use the unprecedented U.S. Navy and Air Force deployment in the region as leverage to negotiate. Sources inside the administration have said that there have been various options on the table, including air strikes against military and civilian infrastructure.
However, the U.S. has so far refrained from direct, inland attacks to date. This could be because the Pentagon fears it would risk destabilising the region, or because military incursions overseas are seen as unpopular by the American public. Over the last few weeks, senators have called for War Powers Resolutions votes, with some Republicans initially sitting on the fence. According to sources on Capitol Hill, these would have voted against blocking further attacks only because administration officials previously assured them that there were no plans for attacks on Venezuela or anywhere else inland, and that President Trump lacked the legal case to carry them out anyway.
