U.S. designates Mexican cartels, Tren de Aragua and others as foreign terrorist organizations

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5. Possible Impact on US businesses

Should the Trump administration choose to use the FTO designation on major Mexican cartels, it may have impacts that have not been fully evaluated. For example, US companies operating in Mexico will need to determine whether their operations may provide “material support or resources” to the cartels—a broadly defined criterion that substantially expands the scope of penalties for violations. Similarly, insurance companies providing services to those US businesses with a presence in Mexico may reconsider their premiums—and whether they wish to further provide services at all. Mexican asylees could assert they are fleeing terrorism if they feel threatened by the cartels. Absent clear guidance from the Trump administration, financial institutions may also be put in a bind as they seek to evaluate whether financial activity involving Mexico may run afoul of the material support clause. The breadth of what may be encompassed under material support, from lodging, to guns, to “expert advice or assistance” renders compliance challenging, particularly as there’s no blacklist or other mechanism against which US companies may screen to evaluate if their funds or services involve cartel members. As such, the reverberations from an FTO designation of major Mexican cartels may be broader than intended.

https://www.atlanticcouncil.org/blogs/mexican-cartels-as-foreign-terrorist-organizations-impact-on-us-businesses/