MPSC Approves Consumers Energy Tariff for Large Data Centers
The Michigan Public Service Commission (MPSC) on November 6, 2025, approved Consumers Energy’s application to amend its General Service Primary Demand (GPD) rate tariff to address service for large data center customers.
The order, issued in Case No. U-21859, establishes new rules for customers with a minimum service threshold of 100 megawatts (MW), or aggregated loads of 100 MW with individual sites of at least 20 MW under common ownership.
The commission added provisions to ensure that other ratepayers are not subsidizing data center costs, while leveraging potential system benefits created by large, consistent data center demand.
Key Provisions Approved by the Commission
Under the order, data centers taking service under the amended tariff will be subject to several new requirements, including:
Contract term: Minimum 15-year agreement, with a possible ramp-up period of up to five years.
Automatic extensions: Five-year extensions, with four years’ notice required for termination.
Minimum billing demand: Monthly billing at 80 percent of contract capacity.
Administrative fee: Upfront project proposal fee of $100,000, reconciled to Consumers Energy’s actual costs.
Financial security: Default collateral requirement equal to half of the required exit fee, decreasing over the contract term, in the form of a standby irrevocable letter of credit or cash, not including a parent guarantee.
Exit fee: If the customer leaves early, the fee equals the minimum monthly bill multiplied by the agreement’s remaining months. Consumers Energy must attempt to mitigate this cost, potentially by reallocating unused capacity.
Contract adjustment: With four years’ notice, customers may request a one-time capacity reduction of up to 10 percent.
Service suspension: Possible if demand exceeds the contracted capacity by 1 MW or more.
Consumers must file ex parte applications with the commission prior to each large-load customer’s taking service to show compliance with the tariff requirements and that the costs caused by the interconnecting large-load customer to be served under this tariff are not being paid for by other customers.
The commission did not address cost allocation, rate design, or broader issues related to the impact of data center load on the state’s renewable and clean energy standards in this order, emphasizing the urgency of implementing the protections in the new tariff.
Background on the Application
Consumers Energy initially filed its application on February 7, 2025, on an ex parte basis, seeking to amend its GPD tariff, the company’s existing rate for large industrial customers, to better manage the risks and requirements of serving new data centers with loads of 100 MW or more.
The utility proposed that these amendments would ensure equitable treatment between data centers and other ratepayers while supporting Michigan’s clean energy transition.
Stakeholder Proceedings and Issues Raised
After several parties objected to ex parte treatment, the MPSC opened an expedited contested case with formal hearings and briefing.
Intervenors included Michigan Attorney General Dana Nessel, several data center interests, environmental organizations, an association of industrial customers, as well as several clean energy trade associations, which were represented in the case by Varnum attorneys Laura Chappelle, Timothy Lundgren, and Justin Ooms.
Among the issues raised by intervenors were:
Whether data centers should receive unique rate treatment or be included under a general large-load tariff.
Whether the 100 MW threshold should be raised or lowered.
Whether large-load customers should remain under Rate GPD or be placed in a new rate class.
Whether contract terms, billing provisions, and financial protections were overly strict or insufficient.
How data center growth might affect Michigan’s clean energy and carbon reduction goals.
Whether customers should be required to submit clean energy sourcing plans or be permitted to obtain a preference for interconnection if they submit clean energy sourcing plans.
Whether the tariff should contain options to maximize the input large customers can have into the resources serving their loads, and maximize the efficiency with which these loads can be served.
Impact and Next Steps
The MPSC’s decision provides greater clarity and predictability for data center developers and operators seeking service from Consumers Energy.
Potential Producer Responsibility Organization Forms to Implement California Textile EPR Program
On November 3, 2025, the California Retailers Association, the American Apparel and Footwear Association, and the National Retail Federation launched the Textile Renewal Alliance, a 501(c)(3) organization that will seek approval from the California Department of Resources Recycling and Recovery (CalRecycle) to implement an extended producer responsibility (EPR) program under California’s Responsible Textile Recovery Act of 2024 (SB 707).
Governor Newsom signed SB 707 into law in September 2024, introducing the nation’s first EPR law for textiles. The launch of the Textile Renewal Alliance responds to SB 707’s requirement that textile producers form and join a producer responsibility organization (PRO), which will be responsible for collecting fees from producers and implementing a program to ensure that covered products are collected, sorted, transported, processed, reused, and recycled after consumer use. Prospective PROs must apply and submit a compliance plan to CalRecycle by January 1, 2026, and CalRecycle must in turn select a PRO by March 1, 2026.
Recent experience from packaging EPR programs in multiple states suggests the PRO will have substantial influence over how SB 707 is implemented. Producers should accordingly be on the lookout for opportunities to engage with both CalRecycle and the Textile Renewal Alliance. Near-term opportunities include signing up for email alerts from CalRecycle and subscribing to the Textile Renewal Alliance’s monthly newsletter. The Textile Renewal Alliance has also indicated that it will be offering webinars on producers’ compliance obligations and the SB 707 implementation process.
SB 707 adds to a growing body of product stewardship programs administered by CalRecycle, including California’s EPR program for packaging and food service ware, SB 54. Although California was the first state to pass a textile EPR law, producer obligations have the potential to expand to other states. In 2025, EPR legislation for textiles was introduced in both New York and Washington. As both states’ legislative sessions have closed for this year, this will be an issue to continue monitoring in 2026. Sellers of apparel and other textile-based fashion items should also continue to monitor potential fashion accountability legislation proposed in several states, as detailed in our prior post.
Sadie Mapstone contributed to this article
Unqualified “Made in USA Claims” and Recycled Materials
Advertisers and manufacturers that utilize unqualified “Made in USA” claim in conjunction with their advertising, marketing, markings, packaging and labeling are at increased risk of private or regulatory scrutiny relating thereto. See the Essential Guide to Made in USA Advertising written by Made in USA lawyer Richard Newman for more information.
For purposes of this article, the issue is whether it is unlawful to make an unqualified “Made in USA” claim for products made from recycled materials. For example, an unqualified “Made in the USA” claim for a product made from minerals and metals recycled in the United States.
The investment of significant time and resources into collecting recyclable material, delivering it to refiners in the United States, and then processing to a purity level of almost 100% may not be enough, alone, to assign a new and different origin to recycled material.
Notable is a prior Federal Trade Commission advisory opinion on the issue that references consumer perception testing on U.S.-origin claims. It found that 57% of Americans – almost 3 in 5 – agree that “Made in America” means that all parts of a product, including any natural resources it contains, originated in the United States. The survey also found that 33% of consumers think 100% of a product must originate in a country for that product to be called “Made” in tha
According to the FTC, a product made from minerals and metals made from recycled materials often contain raw materials of unknown origin. Thus, because gold and precious minerals may be – and often are – mined internationally, it is highly likely that any piece of recycled jewelry, for example, might contain components or natural resources that originated outside the United States.
According to the FTC, consumers may be deceived by a Made in USA marketing claim for a product containing components or natural resources that originate outside the United States. Advertisers and manufacturers should consult with an experienced FTC Made in USA lawyer to discuss whether an unqualifed country-of-origin claim can be substantiated in light of whether all components of a recycled piece – including natural resources – originated in the United States. Unqualified U.S.-origin claims are aggresively policed by regualtory agencies and the failure to ensure that reasonble evidence exists to support such claims may be considered unlaw and a violation of the FTC Labeling Rule.
Federal Trade Commission guidance reflects that when consumers view Made in USA representations, they expect advertised products to be “all or virtually all” made in the United States – all the way back to raw materials. An experienced Made in USA lawyer is a valuable resource for those wishing to avoid regulatory scrutiny or private litigant threats where, for example, products are purchased from U.S. suppliers and the origin of raw materials is unknown.
The BR Privacy & Security Download – November 2025
STATE & LOCAL LAWS & REGULATION
California Governor Signs Age Verification Law: California Governor Gavin Newsom signed the California Digital Age Assurance Act (the “Act”). Beginning January 1, 2027, the Act requires persons or entities that develop, license, or control the operating system software on devices to furnish an interface at account setup for users to indicate the birth date, age, or both, of the user and provide applications with one of four age‑range signals (under 13; 13–15; 16–17; 18+). Additionally, the law prohibits operating system providers and app stores from using compliance data in an anti-competitive manner. Application developers must request and rely on the age-range signal to meet child privacy and safety obligations and avoid using, sharing, or seeking more information than is necessary. For devices with accounts setup before January 1, 2027, the operating system provider shall comply with the Act before July 1, 2027, and include a good‑faith provision for errors tied to technical limits. The Act will be enforced by the California Attorney General, who may seek injunctions and civil penalties up to $2,500 per affected child for negligent violations and up to $7,500 per affected child for intentional violations.
Massachusetts Senate Passes Massachusetts Data Privacy Act: The Massachusetts Senate voted unanimously to pass the Massachusetts Data Privacy Act (the “MDPA”). The MDPA applies to entities handling data of at least 60,000 consumers annually, or 20,000 consumers if data sales comprise at least 20 percent of revenue, and to entities processing reproductive or sexual health data. Key provisions include consumer rights to access, correct, delete, and port personal data, as well as to opt out of targeted advertising, data sales, and certain profiling. The MDPA restricts the collection and use of sensitive data, requires clear privacy notices, and mandates data protection assessments for high-risk processing activities. Enforcement authority is vested exclusively in the Attorney General, who may seek injunctions, damages, and civil penalties up to $5,000 per violation. If passed by the House, the Act would become effective January 1, 2027, with some provisions effective June 1, 2027. Like the Maryland Privacy Act on which the MDPA is based, the MDPA would prohibit the sale of sensitive data, which includes precise geolocation data. The MDPA now awaits review by the Massachusetts House of Representatives.
Pennsylvania House of Representatives Approved the Consumer Data Privacy Act: The Pennsylvania House of Representatives has approved House Bill 78, the Consumer Data Privacy Act (the “Act”). The Act provides individuals with rights to access, correct, and delete personal data, data portability, and to opt out of targeted advertising, the sale of personal data, and certain profiling. Businesses with annual revenues over $10 million and data processors would be obligated to minimize data collection, ensure transparency and security, obtain consent for processing of sensitive data, honor opt‑out signals, and perform data protection assessments. The Act would be enforced exclusively by the Attorney General, which will be considered unfair competition or unfair or deceptive acts and practices under the state’s Unfair Trade Practices and Consumer Protection Law.
NYDFS Issues Guidance on Managing Third-Party Service Provider Risk: The New York Department of Financial Services (“NYDFS”) issued guidance (the “Guidance”) on managing risks related to third-party service providers (“TPSPs”). NYDFS stated that the Guidance does not impose new requirements or obligations on Covered Entities. Rather, it is intended to clarify regulatory requirements and recommend industry best practices to mitigate common risks associated with TPSPs. The Guidance emphasizes that Covered Entities must adopt a proactive, risk-based approach to TPSP governance, with active oversight from senior governing bodies and officers. Key recommendations include: (1) proactive due diligence in the selection of TPSPs, including assessing TPSPs based on access levels, data sensitivity, cybersecurity history, and compliance with standards like National Institute of Standards and Technology or International Organization for Standardization; (2) including provisions for access controls, encryption, breach notification, data location restrictions, subcontractor disclosures, exit obligations, artificial intelligence (“AI”) usage, and data handling in TPSP contracts; 3) monitoring TPSPs on an ongoing basis through audits, penetration tests, and updates on vulnerability management; and (4) ensuring secure data return or destruction and conducting final risk reviews during the offboarding process at the end of the TPSP relationship. The Guidance underscores that compliance responsibility cannot be delegated to TPSPs and that NYDFS will consider third-party risk management in its examinations and enforcement actions.
Minnesota and New Hampshire Join Regulatory Enforcement Consortium: Minnesota and New Hampshire have joined the bipartisan Consortium of Privacy Regulators (the “Consortium”), expanding the group to 10 regulators and creating further cross‑jurisdictional enforcement of state privacy laws, including Minnesota’s Consumer Data Privacy Act and New Hampshire’s Data Privacy Act. The Consortium coordinates investigations of possible violations, shares resources and expertise, and organizes enforcement of common consumer protections that appear across member laws, such as rights over how businesses use consumers’ personal data, including rights to access, delete, correct, and opt out of certain data uses, and stop the sale of personal information, alongside corresponding business obligations. Aligned with this movement towards implementation, enforcement, and compliance, last year, New Hampshire’s Attorney General established a Data Privacy Unit, and Minnesota’s Attorney General is currently expanding the Consumer Protection Division to enforce Minnesota’s law. Members of the consortium now include the California Privacy Protection Agency and state Attorneys General from California, Colorado, Connecticut, Delaware, Indiana, New Hampshire, New Jersey, Minnesota, and Oregon.
FEDERAL LAWS & REGULATION
Federal Cybersecurity Initiatives Lapse During Shutdown: Two U.S. cybersecurity initiatives—the Cybersecurity Information Sharing Act (“CISA”) of 2015 and the State and Local Cybersecurity Grant Program—expired due to congressional gridlock. CISA provides legal protections for organizations sharing cyber threat data, while the grant program, created during the pandemic, allocated $1 billion to help states and localities defend against cyberattacks. Congress failed to act on the reauthorization of the programs prior to the federal government shutdown.
FTC Do Not Call List and Other Consumer Protection Services Unavailable During Shutdown: Due to a lapse in government funding, the Federal Trade Commission (“FTC”) announced a shutdown of several consumer protection services starting at midnight on October 1, 2025. Platforms such as ReportFraud.ftc.gov, IdentityTheft.gov, and Econsumer.gov, which handle domestic and international fraud and identity theft complaints, are temporarily unavailable. The National Do Not Call Registry is also offline for both consumers and telemarketers. While some online services remain accessible for submissions, the FTC stated that no action will be taken until the government reopens.
Joint Commission and Coalition for Health AI Issue Guidance on Responsible Use of AI in Healthcare: The Joint Commission and Coalition for Health AI (“CHAI”) have issued guidance to promote the responsible deployment of AI tools in healthcare. The guidance outlines seven core elements for responsible AI use: (1) AI policies and governance structures that establish formal oversight to manage AI implementation, risk, and compliance; (2) patient privacy and transparency to ensure patients are informed about AI’s role in their care; (3) data security and use protections to prevent misuse and breaches; (4) ongoing quality monitoring that continuously evaluates AI tools post-deployment to ensure safe, reliable performance and mitigate bias; (5) voluntary, blinded reporting of AI safety events to encourage confidential reporting of AI-related incidents; (6) risk and bias assessments that identify and address biases in AI tools; and (7) role-based education and training to promote AI literacy among healthcare staff to ensure safe and effective use.
Bipartisan Bill to Regulate Minor Use of Chatbots Introduced: A bipartisan group of U.S. senators has introduced the GUARD Act to regulate the use of AI chatbots and companions by minors. The bill aims to protect children from exploitative or harmful AI interactions by imposing strict requirements and prohibitions on companies that develop or distribute such technologies. If passed, the GUARD Act would require age verification when creating accounts and periodically thereafter, mandate that chatbot access be tied to a verified user account, prohibit harmful content, require that companies provide users with notice that AI chatbots are not human, and implement safeguards to protect user data. Violations could result in fines up to $100,000.
U.S. LITIGATION
2nd VPPA Case Against NBA Tossed: Judge Jennifer L. Rochon of the Southern District of New York dismissed with prejudice a putative class action against the NBA under the Video Privacy Protection Act (“VPPA”). Plaintiff Michael Salazar alleged that the NBA disclosed his video-viewing information to Meta via the Meta Pixel on NBA.com, transmitting data such as Facebook ID and video titles. The Court held that under binding Second Circuit precedent (Solomon v. Flipps Media, Inc. and Hughes v. NFL), Pixel-based disclosures do not constitute “personally identifiable information” under the VPPA. The “ordinary person” standard requires that the disclosed information would allow an average recipient—not just a sophisticated technology company—to identify a consumer’s video-watching habits. Here, the Court found that an ordinary person could not use the transmitted Facebook ID or code to identify Salazar’s video activity. Arguments that tools like ChatGPT or Google could bridge this gap were rejected as insufficient. Accordingly, the NBA’s motion to dismiss was granted. This decision reinforces the Second Circuit’s narrow interpretation of VPPA liability for Pixel-based data sharing.
Court Dismisses Challenge to New York Algorithmic Pricing Transparency Law: The Southern District of New York dismissed the National Retail Federation’s challenge to New York’s Algorithmic Pricing Disclosure Act, which requires merchants to disclose when a published price is set by an algorithm using a consumer’s personal data. The plaintiff argued that this compelled disclosure violated the First Amendment. The Court applied the Zauderer standard, which governs compelled commercial disclosures of “purely factual and uncontroversial information.” Judge Rakoff found that the required statement, “THIS PRICE WAS SET BY AN ALGORITHM USING YOUR PERSONAL DATA”, is factual, accurate, and not misleading or controversial. The Court held that the law is reasonably related to New York’s legitimate interest in informing consumers and is neither unjustified nor unduly burdensome. Because the plaintiff failed to plausibly allege a First Amendment violation, the Court granted the motion to dismiss and denied the request for a preliminary injunction as moot.
New Jersey Supreme Court Agrees to Review Daniel’s Law: The New Jersey Supreme Court accepted a certified question from the U.S. Court of Appeals for the Third Circuit concerning Daniel’s Law (N.J.S.A. 56:8-166.1), which restricts the disclosure of certain personal information of judges, prosecutors, and law enforcement officers. The Supreme Court reformulated the question to focus on the mental state required to establish liability under Daniel’s Law. The Court ordered the parties to submit briefs addressing this specific issue, setting a schedule for filings and indicating that oral argument would follow. This decision is significant because it will clarify whether liability under Daniel’s Law requires proof of intent, knowledge, recklessness, or strict liability; a determination that will impact both enforcement and compliance for data brokers and other entities subject to the statute.
U.S. ENFORCEMENT
FTC Files Complaint Against Operator of Anonymous Messaging App: The Federal Trade Commission (“FTC”) has taken action against Iconic Hearts Holdings, Inc. (“Iconic Hearts”), the operator of the Sendit anonymous messaging app, and its CEO for violating the Children’s Online Privacy Protection Act Rule, the FTC Act, and Restore Online Shoppers’ Confidence Act. In the complaint filed by the U.S. Department of Justice (“DOJ”) upon referral by the FTC, the DOJ alleged that Iconic Hearts knew that numerous Sendit users were under the age of 13 but failed to notify parents that it collected personal information from children, including their phone numbers, birthdates, photos, and usernames for Snapchat, Instagram, TikTok, and other accounts, and did not obtain parents’ verifiable consent to such data collection. The complaint also alleged that Iconic Hearts made misrepresentations and used fake messages to trick child and teen users into purchasing premium subscriptions and failed to clearly disclose the terms of its subscription plans.
Florida Attorney General Sues Streaming Device Company for Violations of Children’s Privacy: The Florida Attorney General, through its Office of Parental Rights, has filed a civil enforcement action against Roku, Inc. and its Florida subsidiary (collectively, “Roku”) for violations of the Florida Digital Bill of Rights (“FDBOR”) and the Florida Deceptive and Unfair Trade Practices Act (“FDUTPA”). The complaint alleges that Roku willfully disregarded the presence of children on its platform and collected and sold sensitive personal data, including precise geolocation as well as viewing habits, voice recordings, and other information from children, without providing effective notice or obtaining the necessary consents. The complaint also alleges that Roku enabled reidentification of deidentified data by providing the deidentified data to third parties (e.g., advertisers and data brokers) without contractually requiring these third parties to not reidentify the data.
NYC Sues Major Social Media Platforms for Addictive Features. The City of New York (the “City”), the City School District of NY, and NYC Health and Hospitals Corporation filed a complaint in the Southern District of New York against Meta (Facebook/Instagram), Snap Inc. (Snapchat), TikTok/ByteDance, and Google/YouTube, alleging the companies intentionally designed and promoted addictive features targeting minors. The complaint alleges that features such as infinite scroll and auto‑play video, algorithm‑driven “For You” or recommendation feeds, bursts of “Likes” and notifications, beauty/appearance filters, coupled with weak age‑verification and parental controls promote addictive behavior and make it difficult to quit or limit use. The City argues these design choices exploit children’s developmental vulnerabilities and contribute to compulsive use and a broader youth mental health crisis, including anxiety, depression, eating disorders, sleep disruption, and classroom and school‑environment impacts that have forced the City to divert significant resources to counseling and crisis services. The complaint pleads public nuisance and negligence, and requests injunctive relief, an order enjoining the companies’ future contributions to the alleged public nuisance, and equitable relief, funding for prevention and treatment, actual and compensatory damages, and punitive damages.
OCR Settles with Healthcare Provider for Sharing Patient Stories in Violation of HIPAA: The U.S. Department of Health and Human Services Office for Civil Rights (“OCR”) settled with five healthcare providers, collectively known as Cadia Healthcare Facilities (“Cadia”), for violations of the Health Insurance Portability and Accountability Act (“HIPAA”) Privacy and Breach Notification Rules. The settlement resolves OCR’s investigation of Cadia’s disclosure of a total of 150 patients’ names, photographs, and information pertaining to the patients’ conditions, treatment, and recovery through success stories posted to Cadia’s website without obtaining HIPAA authorizations from the patients. Under the settlement, Cadia must pay $182,000 to OCR and implement a corrective action plan that will be monitored by OCR for two years. Cadia must develop, maintain, and revise its HIPAA privacy and breach notification policies and procedures, train its entire workforce, including marketing staff, on those requirements, and issue breach notifications to all individuals whose protected health information was disclosed on facility websites, social media, or other marketing materials without proper authorization.
New York Attorney General Settles with Auto Insurers for Data Breach: The New York Attorney General has settled with eight car insurance companies for data breaches impacting more than 825,000 New Yorkers. The companies allowed consumers to obtain car insurance price quotes using an online tool. After entering limited personal information, the other fields on the tool were pre-populated with other personal information, such as an individual’s driver’s license number and similar information about other drivers in their household. The New York Attorney General’s investigation found that threat actors were able to exploit this “pre-fill” function, and some of the exposed data was later used to file unemployment claims during the COVID-19 pandemic. Under the settlement, the companies must pay a total of $14.2 million in penalties and adopt various security measures, including maintaining a comprehensive information security program, data inventory, reasonable authentication procedures, a logging and monitoring system, reasonable policies and procedures designed to detect suspicious activities, and stronger threat response procedures.
New York Attorney General Settles with Accounting Firm for Data Breaches: The New York Attorney General has settled with Wojeski & Company (“Wojeski”), a public accounting firm, for two data breaches. Wojeski discovered a ransomware attack in July of 2023 caused by a phishing email (“2023 Incident”). Wojeski discovered another data breach in May of 2024, when an employee of the firm engaged to investigate the 2023 Incident improperly accessed customer data located in the files that Wojeski had sent for review. Wojeski did not notify customers of either incident until November 2024. The incidents impacted 6,232 individuals in total and impacted names, dates of birth, Social Security numbers, drivers’ license numbers, email addresses, phone numbers, financial account numbers, medical benefits, and entitlement information. Under the settlement, Wojeski must pay $60,000 in penalties and take certain security measures, including encrypting personal information, providing cybersecurity training to all employees, and maintaining a comprehensive information security program, data inventory, reasonable account management, authentication, and incident response procedures.
INTERNATIONAL LAWS & REGULATION
New Zealand’s Privacy Amendment Act 2025 Signed Into Law: New Zealand’s Privacy Amendment Act 2025 (the “Act”), which amends the Privacy Act 2020, was signed into law and received Royal Assent on September 23, 2025. The Act introduces a new notification requirement for organizations collecting personal information indirectly, meaning from a source other than the data subject. Under Information Privacy Principle 3A, effective May 1, 2026, entities that collect personal information about an individual from sources other than the individual must take reasonable steps to notify the individual of the collection, its purpose, intended recipients, the entity’s identity, and the individual’s rights to access and correct their data. This obligation does not apply if the individual has already been made aware of these matters. The Act also clarifies exemptions for intelligence and security agencies and updates the Privacy Commissioner’s functions, including the ability to assess foreign privacy laws for adequacy.
EDPB and European Commission Issue Guidance on Interplay of GDPR and DMA: The European Data Protection Board (the “EDPB”) and the European Commission have adopted joint guidelines on the interplay between the Digital Markets Act (the “DMA”) and the General Data Protection Regulation (the “GDPR”). While the DMA targets unfair practices and the effects they have on business users, the GDPR covers the protection and processing of people’s personal data. The guidelines aim to ensure that the DMA and the GDPR are interpreted and applied in a compatible manner that achieves their respective objectives, in line with relevant case law. Though not exhaustive, the guidelines address issues of significant overlap, including gatekeepers’ compliance with requirements of end-user choice and consent; distribution of software application stores and applications; rights to data portability for users and authorized third parties; consent‑based business‑user access to end‑user data; access to anonymized sharing of search data; and the interoperability of number-independent interpersonal communication services. The guidelines also mention practical coordination and consultation between the European Commission and data protection authorities to deliver coherent and effective enforcement. Currently, there is a joint public consultation that is open until December 4, 2025, where stakeholders will have an opportunity to provide comments and feedback on this first version of the guidelines.
European Launches Two AI Strategic Initiatives: The European Commission announced two new strategic initiatives, the Apply AI Strategy and the AI in Science Strategy, to accelerate AI adoption across industry and science. The Apply AI Strategy aims to help integrate AI into strategic sectors such as healthcare, energy, manufacturing, and culture. It supports small and medium-sized enterprises, promotes AI-powered screening centers, and encourages the development of frontier models tailored to specific industries. The strategy also addresses workforce readiness, infrastructure, and data access, and introduces the Apply AI Alliance to coordinate efforts across sectors. Around €1 billion will be used to support these initiatives. The AI in Science Strategy is intended to position Europe as a leader in AI-driven research. Key components of the AI in Science Strategy include €58 million for talent development, €600 million for computing power via Horizon Europe, and a goal to double annual AI research funding to over €3 billion. The strategy also focuses on identifying and curating strategic datasets for scientific use. Both strategies build on the AI Continent Action Plan launched in April 2025.
Daniel R. Saeedi, Rachel L. Schaller, Ana Tagvoryan, Gabrielle N. Ganze, P. Gavin Eastgate, Timothy W. Dickens, Karen H. Shin, Amanda M. Noonan, and Sierra N. Lactaoen contributed to this article.
EC Launches Critical Chemicals Alliance; Organizations Active in the Chemical Industry Can Apply Online
The European Commission (EC) announced on October 28, 2025, the launch of the Critical Chemicals Alliance (CCA). According to the EC, the CCA “stems directly from the Chemicals [Industry] Action Plan adopted in July 2025, which aims to boost the competitiveness, resilience and sustainability of Europe’s chemical industry.” The CCA is intended to address key challenges facing the chemicals sector, “including the risk of plant closures, trade disruptions, and the urgent need for investment in critical production capacities.” The EC states among its first deliverables, the CCA will:
Establish criteria to identify critical chemical productions and molecules that are essential for the European Union (EU) economy and strategic sectors;
Map these critical molecules to enable enhanced trade monitoring and early warning functions, including through the EU Customs Surveillance System; and
Support coordinated investments by aligning EU and national funding tools and helping EU member states and industry to target key projects.
The CCA is open to all organizations active in the chemical industry, including companies, associations, investors, research bodies, and civil society. Interested organizations can apply online by signing the CCA’s declaration, thereby committing to contribute actively to its objectives. The CCA will hold its first General Assembly in the presence of Executive Vice-President for Prosperity and Industrial Strategy, Stéphane Séjourné, at a date that will be announced later. All members may participate in the General Assembly, which will meet at least twice a year to set priorities and adopt the CCA’s opinions and recommendations. A Steering Board will coordinate the CCA’s work and define its deliverables, while expert working groups will focus on specific thematic areas such as trade resilience, innovation, and sustainable production. More information on the Chemicals Industry Action Plan is available in our August 7, 2025, memorandum.
Foley Automotive Update – November 2025
Key Developments
Foley & Lardner provided an overview on supply chain cyber threats, and best practices for mitigating cyber risks.
The Michigan Supreme Court intends to rule in the months ahead on a dispute over the “legitimacy of Stellantis’ supplier contracts,” according to an update from Crain’s Detroit.
U.S. new light-vehicle sales in October 2025 fell by over 4% year-over-year to a SAAR of 15.4 million units, according to preliminary analysis from Haver Analytics.
Foley & Lardner partner Gregory Husisian shared insight on how a possible tariff refund process could play out in the SupplyChainDive article, “What shippers need to know about potential tariff refunds.” The U.S. Supreme Court will hear oral arguments on November 5, 2025, regarding the legality of the Trump administration’s tariffs as imposed under the International Emergency Economic Powers Act (IEEPA).
China’s Commerce Ministry suggested it will offer exemptions to the recently imposed export restrictions on semiconductors made by Chinese-owned, Netherlands-based Nexperia, which supplies an estimated 40% of certain chips critical to automakers. The company has various issues to resolve with the Dutch government, and uncertainty remains over when the shipments will resume.
A new trade and economic deal between the U.S. and China includes a reprieve on certain rare-earth export controls recently imposed by China. Despite the two nations’ recently announced trade agreement, U.S. Trade Representative Jamieson Greer plans to continue an investigation into China’s compliance with a limited trade agreement reached during President Trump’s first term. The results of this Section 301 probe could result in new tariffs, or leverage in subsequent trade negotiations.
S&P Global Mobility assessed the impact of the Section 232 tariffs on truck and bus imports imposed by the Trump administration on November 1. The analysis notes the October 17 executive order announcing the levies also expanded the list of tariffed auto parts, with “more varieties of drive axles, wider application of engine components, and adds items including touch screen displays, certain engine control units and speakers.”
President Trump extended a November 1, 2025 deadline to reach a trade deal with Mexico for an unspecified number of weeks, resulting in a delay of higher tariffs on Mexican goods that do not meet the content rules of the U.S.-Mexico-Canada trade agreement.
President Trump intends to impose an additional 10% tariff on Canadian imports, and said he does not plan to resume trade negotiations with Canada due to an anti-tariff advertisement aired by the Ontario government. The Trump administration did not provide details on the implementation of the new tariffs or if USMCA-compliant goods would be exempt.
The U.S. and South Korea are reported to have finalized a trade deal that is expected to establish a 15% cap on U.S. tariffs on Korean goods. This follows a framework agreement the nations announced in July.
Last month the U.S. Senate narrowly passed three measures opposing President Trump’s global “reciprocal” tariffs, as well as the emergency authorities underpinning the tariffs on Canada and Brazil. The U.S. House is not expected to vote on the measures in the near future, and Congress would require a two-thirds majority to overcome a presidential veto.
OEMs/Suppliers
Revised projections for tariff-related costs in 2025 are between $3.5 billion to $4.5 billion for GM, up to $1.2 billion for Stellantis, and up to $1 billion for Ford.
Canada intends to reduce the number of vehicles GM and Stellantis can import tariff-free into the country in response to the automakers’ plans to reduce vehicle production in the nation.
A number of major automakers submitted filings to urge the U.S. Trade Representative’s Office to extend the USMCA, as it accounts “for tens of billions of dollars in annual savings.” The USMCA is scheduled for formal review in 2026.
Ford estimated the recent fire at a significant aluminum supplier will impact profitability by $1.5 billion to $2 billion in 2025, while noting mitigation efforts are expected to offset half of the cost.
American Axle plans to invest $133 million to increase production and upgrade its plant in Three Rivers, Michigan.
Nissan reduced its U.S. output by approximately 7,400 vehicles in October due to parts shortages.
Geely will acquire a 26.4% stake in Renault do Brasil, and the Chinese automaker expects the partnership will accelerate its plans to expand sales in the market.
Multiple European automakers have replaced CEOs this year, as ongoing economic and market challenges impact European vehicle sales.
Market Trends and Regulatory
According to the NADA Data 2025: Midyear Report released in October, there were 16,972 new-car dealerships in the U.S. as of June 2025, and the top five states with the most dealerships were California, Texas, Florida, Pennsylvania, and Ohio. In addition, 90.7% of all new light-vehicle dealers owned one to five stores, down from 95% in 2014.
WardsAuto provided a list of the top automotive conferences to consider in 2026.
Vulcan Elements and ReElement Technologies secured $1.4 billion in combined funding from the U.S. government and private investors to establish a domestic rare-earth magnet supply chain.
Autonomous Technologies and Vehicle Software
Waymo began testing its autonomous vehicles in Detroit. The company currently offers robotaxi service in parts of San Francisco, Los Angeles, Phoenix, Atlanta, and Austin, and it plans to expand services to cities including San Diego and Las Vegas next year.
Uber announced plans to launch autonomous taxi service in the San Francisco Bay Area in 2026 with vehicles developed in partnership with EV maker Lucid and self-driving technology company Nuro Inc. Uber has also established a goal to have a fleet of 100,000 autonomous vehicles in its fleet that are powered by Nvidia technology beginning in 2027.
Bloomberg provided an overview of Chinese companies’ robotaxi deployment plans within multiple regions.
Hybrid and Electric Vehicles
J.D. Power predicted U.S. EV sales in October 2025 will decline 3.4 percentage points to a market share of 5.2%, as the market recalibrates following the expiration of federal tax credits.
On November 4, Automotive News updated its list of U.S. EV models that have been delayed or canceled.
GM plans to lay off over 3,000 hourly workers across its EV and EV battery plants in Michigan, Ohio, and Tennessee in the coming months. Over half of the layoffs are expected to be indefinite. The automaker also laid off over 200 salaried workers at its Warren Tech Center in Michigan as part of a restructuring of its design-engineering team, and over 300 employees as part of the closure of its Georgia IT center.
BYD reported its third-quarter 2025 net profit declined 33% year-over-year, and revenue fell 3% YOY.
LG Energy Solution – Stellantis joint venture NextStar Energy will shift to producing batteries for energy storage systems at its Windsor, Ontario factory instead of EV batteries.
Volkswagen subsidiary PowerCo started construction on a $7 billion EV battery plant in St. Thomas, Ontario.
Patented, Proprietary, or Problematic? Supreme Court Declines to Resolve Circuit Split on Lanham Act False Advertising Claims
On October 6, 2025, the U.S. Supreme Court declined to review the Federal Circuit’s decision in Crocs, Inc. v. Double Diamond Distrib., Ltd., et al., leaving a circuit split regarding Lanham Act false advertising claims firmly in place. The Second, Sixth, and Ninth Circuits have held that the Lanham Act’s false advertising cause of action does not extend to statements concerning the intangible features of a product, like whether it is patented or proprietary. But the Fourth and Federal Circuits have held the opposite. Without guidance from the Supreme Court, companies face potential liability for advertising claims that will depend on the forum of the lawsuit.
The Underlying Case
This issue in Crocs stemmed from a protracted legal battle initiated in 2006 against Double Diamond Distribution, Ltd., U.S.A. Dawgs, Inc., and Mojave Desert Holdings, LLC (collectively, Dawgs). A decade later in 2016, Dawgs alleged that Crocs violated the Lanham Act by falsely claiming that its closed-cell resin “Croslite” was exclusive, proprietary, and patented. Dawgs alleged that the statement was likely to deceive consumers into believing that all other molded footwear is made of inferior material. The U.S. District Court for the District of Colorado found these statements not actionable under the Lanham Act following the precedent set by the Second, Sixth, and Ninth Circuits.
But the Federal Circuit reversed the lower court decision, holding that the prohibition on misrepresentations about “the nature, characteristics, qualities, or geographic origin” of a product extends to intangible properties.[1] In doing so, the Federal Circuit agreed with Dawgs’ assertion that “a cause of action . . . where a party falsely claims that it possesses a patent on a product feature and advertises that product feature in a manner that causes consumers to be misled about the nature, characteristics, or qualities of its product.”[2] On October 6, 2025, the Supreme Court declined to review the case, leaving intact the Federal Circuit’s ruling that expands the scope of Lanham Act false advertising claims and the split among the circuits. Without Supreme Court intervention, the matter will remain unsettled, and the remaining circuits will have to decide between the two competing views of the law.
How can companies alleviate risks when advertising?
The overlap between intellectual property laws and advertising rules can make things complicated for businesses trying to promote their products. Each state has its own laws about what you can say in ads, and now, because circuits do not all agree on the standards that apply, a company might be liable for false advertising in one state but not in another. A business could end up facing a lawsuit in a state where your ads reached customers—even without any sales in that state. With online ads and social media, this risk is even higher since a company’s advertisements can be seen almost anywhere in the country.
To alleviate risks when advertising, consider the following best practices:
Exercise caution when describing products as “exclusive” or “proprietary” in marketing materials to avoid overstating intellectual property protections.
Consult with in-house or external legal counsel to confirm that all advertising claims are legally supportable and compliant with applicable laws.
Train marketing and advertising teams on the risks and legal implications of making exaggerated or unsupported intellectual property and product claims.
Regularly monitor competitors’ advertisements for potential violations of federal and state laws, including misleading claims about their own or competing products.
[1] Crocs, Inc. v. Effervescent, Inc., 119 F.4th 1, 11 (Fed. Cir. 2024), cert. denied sub nom. Crocs, Inc. v. Double Diamond Ltd., No. 25-75, 2025 WL 2824166 (U.S. Oct. 6, 2025)
[2] Id.
Federal Court Enjoins NCAA’s “Five-Year Rule” for JUCO Athletes
On September 18, 2025, the U.S. District Court for the District of Nevada issued a significant order in Martinson v. National Collegiate Athletic Association, granting a preliminary injunction against the NCAA’s enforcement of its “Five-Year Rule” as applied to junior college (JUCO) athletes. The Five-Year Rule restricts student-athletes who attended a JUCO to a maximum of two or three seasons of NCAA Division I competition, while those who enroll directly in Division I institutions are eligible for four seasons.
Prior to becoming a Division 1 defensive lineman for the University of Nevada, Las Vegas (UNLV) football team, Plaintiff Tatuo Martinson played two full seasons at a JUCO. After completing two seasons at UNLV, the NCAA declared Martinson ineligible to play in the 2025-26 season citing the Five-Year Rule. As a result of his ineligibility, Martinson lost a name/image/likeness (NIL) opportunity for a video game, and potentially his spot on the UNLV football team.
Martinson challenged the Five-Year Rule by bringing suit against the NCAA for violating Section 1 of the Sherman Antitrust Act and breach of contract. Martinson argued the rule constituted an undue restraint on trade and caused immediate and irreparable harm by disqualifying him from the upcoming football season and associated career opportunities.
In yet another win for student-athletes, the court found that the Five-Year Rule operates as a restraint imposed by the NCAA’s monopsony power over the labor market for competitive athletic football service. As a result, the rule harms competition by limiting the amount of time JUCO athletes can participate in the labor market and, by extension, their compensation.
In opposition to Martinson’s claims, the NCAA argued that there should be an antitrust exemption to its eligibility rules because the rules are “non-commercial” and therefore beyond the scope the Antitrust Act. The court squarely rejected the NCAA’s hail mary attempt. In its reasoning, the court relied heavily on the landmark decision in National Collegiate Athletic Ass’n v. Alston, 594 U.S. 69 (2021), which held that NCAA bylaws prohibiting compensation for student-athletes violated Section 1 of the Sherman Act. The court stated that post-Alston, the product offered by the NCAA—competitive college athletic sports—is now considered a labor market with compensated workers. The court reasoned it would be unjustifiable for the NCAA’s eligibility rules to be deemed “non-commercial” when those rules determine the ability of Division 1 athletes to participate, and thus be compensated, in the labor market offered by the NCAA. Additionally, the court found there was no dispute that the NCAA’s dominance over the labor market for student-athlete services was significant, especially post-Alston where 99% of NIL opportunities were given to NCAA Division I sports.
The court also refused to adopt the NCAA’s position that the Five-Year Rule has pro-competitive justifications. The court highlighted the NCAA’s lack of evidence to support its assertions and its prior inconsistent statements. Moreover, the court noted the goals of the NCAA could be accomplished through less restrictive means other than the Five-Year Rule.
This decision underscores the evolving legal landscape for college athletics, especially as direct compensation and NIL opportunities expand. Institutions should closely monitor ongoing antitrust challenges to NCAA eligibility rules, as further changes may affect student-athlete participation, scholarship awards, and compliance strategies.
Takeaways for Dealmakers from US Antitrust Merger Enforcement Trends
Heading into 2025, U.S. antitrust authorities favored litigating to block mergers that raised partial competition concerns, rather than entering into negotiated solutions. Now, well into the new administration, there is evidence of how this enforcement approach has shifted, not just in policy statements, but in live cases as well. The authorities are doing more to resolve concerns at a pre-litigation stage, touting a more efficient process to foster innovation. That said, there have still been new litigated merger cases filed since January. Examining the cases brought and settled, several key trends have emerged that may impact future deal planning.
A Shift in Policy Rhetoric
Early on in the last administration, the former Federal Trade Commission (FTC) chair confirmed that she would “focus [] resources on litigating, rather than on settling.” The policy was driven at least in part by the complexity with finding the right solution. As the Department of Justice (DOJ) leadership put it, “remedies shorty of blocking a transaction too often miss the mark.” The follow-through was stark as any negotiated settlements fell off sharply several months into the administration. This impacted dealmaking by lengthening timelines and costs.
The new FTC Chair, Andrew Ferguson, has emphasized a more predictable merger review process and more efficient use of agency resources. He views merger settlements as a tool to “complement to [FTC’s] merger litigation efforts” and explicitly broadcasts that “the Commission is open to settlement offers that eliminate the possibility” of competitive harm. The rationale behind this, according to all three current FTC commissioners, is to promote innovation: “[m]ergers and acquisitions are a critical way in which capital fuels innovation because they are part of how investors realize returns on their investments. . . . If acquisition by a larger company is not a realistic potential exit strategy, investors will have less incentive to invest.” Consistent with this shift in tone, both FTC and DOJ have approved merger settlements this year.
Licensing Remedies Have Surfaced to Bolster Divestitures
U.S. antitrust authorities have long preferred structural relief (i.e., divestitures), rather than obtaining behavioral commitments from parties because the later creates the potential for ongoing oversight. However, products giving rise to competitive concerns in a merger may sometimes have elements shared with other products that do not, making a complete divestiture of the former more complicated. The new antitrust leadership, however, has stated that “[t]here may be times in which limited behavioral remedies buttress genuine structural relief. Remedies are inherently fact-specific, and behavioral conditions can provide necessary and adequate support.” Indeed, in one case that the DOJ settled over the summer, the buyer agreed to sell its competitive business and at the same time license related software source code used in the target’s product (as well as provide engineers and sales employees) to further foster competition post-close. Going forward, parties should consider whether supplemental commitments would help to bolster any divestitures to resolve competitive concerns.
Openness to Arguments About a Target’s Failing Economics
Historically, claiming that a transaction lacks competitive concerns because a target is failing has been subject to a high evidentiary bar. The DOJ and FTC 2023 Merger Guidelines outline that the agencies will consider such arguments where a target cannot meet its financial obligations in the near future, there is no prospect of reorganization and/or attempts to resolve matters with creditors has failed, and the acquiring party (creating the competitive concern due to its overlap) is the only available purchaser, meaning solicitation of other bidders was tried and failed.
However, when the DOJ closed its investigation of T‑Mobile/UScellular in July, it stated that it had concerns “UScellular simply could not keep up with the escalating cost of capital investments in technology required to compete vigorously,” and concluded that, absent the transaction, consumers would face “slow degradation” in quality. While the statement did not go so far as to establish all the “failing-firm defense” elements, it did find the potential harm to consumers from a challenged UScellular outweighed the potential harm with leaving only three main wireless competitors, as DOJ characterized. While each industry and the status of any target is unique, in today’s climate, parties should consider whether arguments about the weakened financial state of a target are available to buttress a broader advocacy strategy.
Prior Approval and Notice Provisions Still in Use
While settlements have returned to the enforcer toolbox—potentially benefiting parties in terms of time and cost to close—the use of prior‑approval and prior‑notice provisions in those settlements have also returned, creating ongoing burdens. Such provisions allow the government to avoid having to go to court to block a future deal or receive notice of deals that are not otherwise reportable under the Hart-Scott-Rodino Antitrust Improvements (HSR) Act. In 2021, the FTC issued a formal policy statement restoring its use of prior‑approval clauses in merger settlements. This year, the FTC has used them in a retail deal and a healthcare deal—both cases involving local markets. Dealmakers may expect that in some instances a settlement might come with ongoing oversight, implicating future roll-up or tuck-in plans.
Litigation Remains in Toolbox—Healthcare Focus Thus Far
Lastly, despite the more open settlement climate, parties should still consider the risk of litigation if a compromise is not feasible. While both authorities are dedicating significant resources to active monopolization cases, they are still willing to litigate mergers. FTC has filed two cases since January, both in the healthcare space. For example, in March, the FTC sued to block private‑equity firm GTCR’s proposed acquisition of Surmodics, alleging the deal would combine the two leading suppliers of outsourced hydrophilic coatings for medical devices and create a firm with over half the market. Accordingly, dealmakers should continue to pay close attention to where parties are close head-to-head competitors in any potentially relevant market when anticipating how a merger review process might unfold.
Tariff Risk Strategies for Renewable Energy Sponsors and Financing Parties
As tariff regimes evolve—particularly under Sections 201 and 301 of the Trade Act—project sponsors and financing parties should be thinking regularly about strategies to allocate and mitigate tariff-associated risks. The urgency of this issue has intensified in recent weeks following a significant escalation in U.S.-China trade tensions. On October 10, 2025, President Trump announced plans to impose an additional 100% tariff on Chinese imports starting November 1, 2025, in response to China’s new restrictions on rare-earth mineral exports. This announcement triggered a global market sell-off and heightened concerns about supply chain disruptions in the renewable energy sector – the imposed tariffs will particularly have acute impacts on solar, battery storage, and wind component costs. China has countered with its own measures, including new port fees and sanctions on foreign companies, further complicating the trade landscape. Given these developments, this article outlines several approaches that sponsors and financing parties can use to manage tariff-related risks, spanning contractual structuring, financial modeling and structuring, and strategic planning.
For Sponsors:
Tariff Risk-Sharing Clauses in Project Documents
Sponsors can embed tariff-specific provisions into EPC, supply, and O&M agreements. Ideally, to shield themselves—and by extension, lenders—from cost volatility, sponsors would secure fixed-price contracts and allocate as much tariff risk as possible to suppliers or EPC contractors. However, in today’s tariff environment, a balanced approach is often more commercially feasible. For example, one party may assume tariff risk up to a certain threshold (either in absolute dollar terms or as a percentage), after which the other party shares in the tariff burden. Beyond a second threshold, either or both parties may have termination rights. Some sponsors have also successfully negotiated limited tariff risk-sharing with offtakers. Example structures include enabling the sponsor to seek a defined contract price increase if its costs exceed an agreed-upon threshold by automatic right, with anything above that threshold requiring joint approval with the offtaker. Further, should joint agreement not be possible, the sponsor sometimes has an early termination right (often coupled with a termination fee) if the project just isn’t economic.
Maximizing Other Incentives
Given the volatility and potential rise in tariffs, sponsors should maximize the use of government incentives, tax credits, and subsidies to offset tariff-related costs. Monitoring policy developments is crucial. Sourcing components domestically or investing in domestic manufacturing can help sponsors bypass tariffs and reduce the compliance burden related to “foreign entity of concern” rules under tax credit regimes. Exploring alternative technologies or renewable solutions not currently subject to tariffs may also yield better tariff treatment and unlock eligibility for tax credits unaffected by the One Big Beautiful Bill Act. To learn more about the One Big Beautiful Bill Act and recent guidance, please see here and here.
Strategic Partnerships and Supply Chain Diversification
Sponsors may benefit from building relationships with suppliers across multiple countries to reduce dependency on tariff-affected nations. Forming strategic partnerships with global renewable energy firms can enhance negotiating power. Collaborating with industry groups and leveraging advocacy channels can also help push for regulatory clarity, stability, and potential tariff exemptions for renewable components.
Financing Structures and Insurance Protections
Sponsors may also consider mezzanine financing or hybrid debt instruments to provide flexibility amid tariff-induced cost fluctuations by providing sponsors with liquidity to make quick buying decisions when pricing is more advantageous. Project refinancing strategies can also help adapt to changing tariff environments. Additionally, specialized tariff or political risk insurance can protect projects from sudden tariff implementation or escalation. Such insurance products, typically offered by multilateral agencies, export credit institutions, or private insurers, can be structured to protect the insured project or portfolio from financial losses arising from unforeseen tariff imposition, increases in existing tariffs, or other trade‑restrictive measures implemented by host or foreign governments. This coverage can be critical for projects with cross‑border supply chains, imported equipment, or raw materials subject to international commodity flows.
For Financing Parties:
From the financing side, existing protections often include indemnity carve-outs that prioritize lender repayment over sponsor obligations, ensuring indemnities sit below debt service in the cash waterfall. Financing parties may also:
Incorporate additional deadline cushions.
Request sponsor certifications regarding AD/CVD and tariff risks.
Require tariff-specific contingency reserves or guarantees to cover tariff-related cost increases.
Assess sponsor creditworthiness (e.g., financial disclosures, minimum liquidity).
Consider requesting equity contribution agreements or secured guarantees.
Request tariff contingencies in financial models and/or special insurance coverage.
Ultimately, financing parties should be responsive to the kinds of mitigants that the applicable sponsor has been able to obtain in its project contracts for tariff risks.
As the global trade landscape continues to shift, tariff exposure will remain a critical consideration in project development and financing. By proactively embedding risk-sharing mechanisms, leveraging policy incentives, and aligning financial structures with evolving regulatory realities, both sponsors and financing parties can better navigate uncertainty and safeguard project viability. A thoughtful, collaborative approach to tariff risk management not only strengthens individual projects but also contributes to the resilience of the broader renewable energy ecosystem.
Striking Russian Oil and The Ripple Effects
As Russian Energy Week concluded last week, Western governments strike to the heart of Russia’s energy sector with sanctions packages to cut of revenue that funds Russia’s continued war against Ukraine. Three significant packages were announced in October 2025: the U.S.’s sanctions targeting the Russian energy sector, the UK’s latest sanctions against the Russian oil industry, and the EU’s 19ᵗʰ package of sanctions.
U.S. Measures
On October 22, 2025, in a significant escalation aimed at pressuring Russia to cease hostilities in Ukraine, the Trump Administration announced new sanctions targeting two of Russia’s largest oil companies: Open Joint Stock Company Rosneft Oil Company (“Rosneft”) and Lukoil OAO (“Lukoil”), as well as certain subsidiaries. All are now designated as specially designated nationals (SDNs) pursuant to Executive Order 14024 for their operations in the energy sector of the Russian Federation.
This action marks the first direct sanctions relating to Russia in the second Trump Administration, representing a major shift in U.S. policy and sanction strategy.
Critically, any foreign financial institution that conducts or facilitates significant transactions with Rosneft, Lukoil, or their designated subsidiaries are also exposed to the risk of U.S. sanctions.
Looking ahead, the Trump Administration could also further impose secondary sanctions in the Rosneft and Lukoil oil supply chain by targeting foreign banks in China or refineries in India that process or purchase Russian oil.
Already, the Trump Administration has imposed a 25% tariff on Indian goods due to India buying Russian oil. We have also seen a “maximum pressure” campaign of sanctions used against the Iranian oil sector, where the Trump Administration targeted not only Iranian producers but also foreign parties who helped facilitate that trade. The current measures may signal further intensification against Russian energy interests and any foreign entities that enable their operations.
Relatedly, the Treasury’s Office of Foreign Assets Control (OFAC) also issued the following general licenses:
License
Summary
Expiration
GL 124A
Authorizes petroleum services & other transactions related to Caspian Pipeline Consortium & Tengizchevroil projects
Ongoing exemption
GL 126
Authorizes the wind-down of transactions involving Rosneft or Lukoil
Nov 21, 2025
GL 127
Authorizes certain transactions related to debt/equity/derivatives of Rosneft or Lukoil
Nov 21, 2025
GL 128
Authorizes certain transactions involving Lukoil retail service stations located outside Russia
Nov 21, 2025
Transactions related to Caspian Pipeline Consortium and Tengizchevroil Projects remain exempt from these new restrictions beyond the wind-down period.
UK Measures
On October 15, 2025, the UK Government announced a package of ninety new sanctions that, as Chancellor Rachel Reeves stated, are intended to take Russian oil off the market. Specifically, the UK sanctions package is directed at Russian oil and its infrastructure and designates Rosneft and Lukoil in an attempt to cut off funding for Russia’s military operations. As Russia’s largest oil producers[1] and some of the largest energy companies in the world, the companies now face asset freezes, director disqualifications, transport restrictions, and a ban on UK trust services.
The UK sanctions also target Russia’s oil-trading infrastructure. The package sanctioned four oil terminals in Shandong Province, China; forty-four vessels identified as operating in Russian’s shadow fleet; and Nayara Energy Limited, an Indian refiner that imported $ billion worth of Russian oil in 2024.
In addition, the sanctions package also targets Russian liquid natural gas (LNG). The UK sanctioned seven specialized LNG tankers and the Beihai LNG terminal in China, which imports LNG from the sanctioned Russian flagship Arctic LNG2.
The sanctions also target the Russian military supply chain, designating businesses that supply electronics critical for Russian drones and missiles in Thailand, Singapore, Turkey, and China.
The UK package also includes import restrictions, banning imports of oil products refined in third countries from Russian‑origin crude.
EU Measures
On October 23, 2025, the EU Council announced that it would adopt a 19ᵗʰ package of sanctions containing 69 new individual listings and numerous economic restrictive measures. The package targets sectors that support Russia’s invasion of Ukraine, including its energy, finance, and military‑industrial sector. The EU also moved to restrict the movement of Russian diplomats across the EU and to punish those responsible for the abduction of Ukrainian children.
Targeting Russia’s energy sector, the EU will ban imports of Russian liquefied natural gas (LNG), beginning in 2027 for long-term contract, and within six months for short-term contracts. The EU also expanded its sanctions against Rosneft and Gazprom Neft by eliminating previous exemptions.[2]
The EU sanctions package also targets the infrastructure and supply chain that the Russian energy sector has used to circumvent sanctions. The package targets Russia’s shadow fleet by adding 117 vessels suspected of circumventing price caps to the EU sanctions list. Those vessels face port‑access bans, service prohibitions, and a ban on re‑insurance. The package also sanctions Litasco Middle East DMCC, a shadow‑fleet enabler linked to Lukoil, as well as maritime registries providing false flags. Chinese oil refineries and oil traders were also sanctioned for importing large volumes of Russian crude oil.
With regard to the Russian financial sector, the EU, for the first time, directly targeted cryptocurrency infrastructure. Sanctions apply to the developer of A7A5, a ruble‑backed stablecoin, its Kyrgyz issuer, and the operator of a trading platform where A7A5 is traded. The sanctions package prohibits transactions involving A7A5 throughout the EU. Five Russian banks (Istina, Zemsky Bank, Commercial Bank Absolut Bank, MTS Bank, and Alfa‑Bank) and eight banks and oil traders in Kyrgyzstan and Tajikistan face new transaction bans. The package also prohibits use of Mir, the Russian National Payment Card System and SBP, the Fast Payments System.
The EU also targeted Russia’s military industrial sector with targeted export bans on select entities, expansion of existing export bans on goods and services, and restrictions on entities in Russian Special economic zones (SEZs). The Council identified forty-five entities that would be subject to export restrictions related to dual-use good for supporting the Russian military by circumventing export restrictions. Twenty-eight of those entities are in Russia, twelve are in China, three are in India, and two are in Thailand. The EU extended existing export bans to include electronic components, rangefinders, chemicals used in propellants, metals, oxides and alloys used in weapons manufacture, salts, ores, rubber articles, tubes, tyres, construction materials, and all acyclic hydrocarbons. All services provided to the Russian government now require prior authorization, and the package prohibits EU operators from providing AI services, high‑performance computing services, commercial space‑based services to Russian entities, as well as banning services related to the Russian tourism. Entities active in nine Russian SEZs were added to the EU sanctions list, and investment bans were introduced to restrict future investment in these zones.
Finally, the EU implemented controls on the movement of Russian diplomats and targeted sanctions related to the abduction of Ukrainian children. Russian diplomats travelling across the Schengen area beyond their country of accreditation must provide advance notice to the relevant EU member state. Member states may also impose authorization requirements for Russian diplomatic travel. The EU listed eleven individuals involved in the abduction, forced deportation, forced assimilation and militarization of Ukrainian children.[3] The EU also adopted a new expedited listed criteria for sanctioning parties responsible for the abduction of those children.
Conclusion
The coordinated sanctions underscore a united push by Western governments to increase economic pressure on Russia and secure an end to Russia’s invasion in Ukraine. For the United States, these sanctions come after peace talks with Russia were cancelled by Trump because “they don’t go anywhere.” UK Foreign Secretary Yvette Cooper identified that the UK would continue to pressure Russia until Putin “abandons his failed ware of conquest and gets serious about peace.” The EU’s forthcoming ban on Russian LNG sends a strong message that the EU is willing to decouple from the Russian economy in order to secure Ukrainian sovereignty.
FOOTNOTES
[1] In January 2025, the UK sanctioned Russia’s third and forth largest producers, Gazprom Neft and Surgutneftegas.
[2] The EU has not sanctioned Lukoil.
[3] Ukraine estimates that nearly 20,000 children have been abducted by Russia.
United States Imposes Sanctions on Russian Energy Companies
On 22 October 2025 the US Department of the Treasury’s Office of Foreign Assets Control (OFAC) designated two of Russia’s largest energy companies, Rosneft and Lukoil, as well as numerous of their subsidiaries, on the Specially Designated Nationals and Blocked Persons List (SDN List). Intended to increase pressure on Russia’s energy sector and degrade a source of revenue for the war in Ukraine, this action will have broad implications for international energy markets.
Designated pursuant to Executive Order 14024 for operating or having operated in the energy sector of the Russian economy, the companies added to the SDN List are now “blocked,” meaning that US persons are strictly prohibited from dealing directly or indirectly with them and must furthermore block (freeze) any property and property interests of these entities coming into their ownership or possession. Importantly, under OFAC’s “50% Rule,” any entities owned 50% or more directly or indirectly, whether individually or in the aggregate, by Rosneft, Lukoil, or their other designated subsidiaries must also be treated as blocked SDNs.
In conjunction with this action, OFAC issued four general licenses authorizing certain limited transactions involving Lukoil, Rosneft, and entities they own 50% or more directly or indirectly, whether individually or in the aggregate (collectively, the “Blocked Entities”):
General License 126, authorizing through 12:01 a.m. EST, 21 November 2025, with limited exceptions, transactions ordinarily incident and necessary to the wind-down of transactions involving the Blocked Entities.
General License 127, authorizing through 12:01 a.m. EST, 21 November 2025, certain debt, equity or derivative contracts involving the Blocked Entities.
General License 128, authorizing through 12:01 a.m. EST, 21 November 2025, certain transactions involving the purchase of goods and services from, or the maintenance, operation, or wind down of Lukoil retail service stations located outside Russia.
General License 124, authorizing certain petroleum services and other transactions related to the Caspian Pipeline Consortium and Tengizchevroil Projects (superseding previous GL 124).
The following are the Rosneft and Lukoil subsidiaries OFAC designated on the SDN List:
Limited Liability Company Lukoil Perm.
Lukoil Aik A Limited Liability Company
Lukoil Kaliningradmorneft
Lukoil West Siberia Limited
Russian Innovation Fuel and Energy Company
Uraloil
Aktsionernoe Obshchestvo Kuibyshevskii Neftepererabatyvayushchii Zavod
AO Sibneftegaz
Bashneft Dobycha
CJSC Vankorneft
JSC East Siberian Oil and Gas Company
JSC Grozneftegaz
JSC Rospan International
JSC Ryazan Oil Refinery Company
JSC Samaraneftegaz
Kharampurneftegaz
LLC Bashneft Polus
LLC Kynsko Chaselskoe Neftegaz
LLC RN Purneftegaz
LLC RN Tuapse Oil Refinery
LLC RN-Krasnodarneftegaz
OJSC Achinsk Refinery
OJSC Novokuybyshevsk Refinery
OJSC Orenburgneft
OJSC Samotlorneftegaz
OJSC Syzran Refinery
PJSC Verkhnechonskneftegaz
PJSC Saratov Oil Refinery
Publichnoe Aktsionernoe Obschestvo Udmurtneft Imeni VI Kudinova
RN Komsomolskiy Refinery
RN Nyaganneftegaz
RN Uvatneftegaz
RN Yuganskneftegaz
Taas Yuryakh Neftegazodobycha
This article was authored by Steven Hill, Jeff Orenstein, and Brian Hopkins