Sanctions 2026

Reflecting on Sanctions

Prior to the chapters that follow, it is worth reflecting on the remarkable transformation which sanctions – and the related market more generally – have undergone over the past decade. 

Once viewed primarily as a diplomatic tool operating at the margins of international relations, sanctions have evolved such that they have become the principal mechanism through which states pursue foreign policy objectives, protect national security interests, respond to geopolitical crises and seek to influence behaviour. This is true both of targeted sanctions (ie, restrictive measures targeted at entities or legal or natural persons) and of trade sanctions (eg, sanctions on the purchase of oil or the provision of professional services). In so doing, sanctions have developed into a highly complex and increasingly consequential area of law which sits at the intersection of public international law, human rights, dispute resolution, international trade, financial services regulation and reputation management.

The pace of this transformation has accelerated considerably in recent years. The sanctions imposed in response to Russia’s war of aggression against Ukraine rapidly became the most extensive and co-ordinated sanctions campaign in modern history, thus fundamentally reshaping the global sanctions landscape. Nevertheless, the significance of sanctions today extends far beyond a single conflict; rather, governments around the world (albeit, chiefly in the Global North) continue to deploy sanctions in order to address a broad range of issues, including, but not limited to:

• armed conflicts;
• terrorism;
• organised crime;
• corruption;
• human rights abuses; and
• nuclear proliferation.

This has been at the forefront of geopolitical discussion in recent months, due to the commencement of the Israel/US-Iran conflict, which began in February 2026. At the same time, economic security considerations have become increasingly intertwined with sanctions policy, due to the volatility of certain markets (eg, the energy sector) as a result of, inter alia, the aforementioned conflicts, which must often be considered in tandem in order to adequately determine their impact on global politics and supply chains. The practical consequence of these developments is that both domestic and international clients alike must constantly remain abreast of the legislative, regulatory and political changes and assess the impact of those changes upon their lives and businesses.

Against this backdrop, sanctions have become an issue of increasing global consequence. While the United States, the European Union (EU) and the United Kingdom remain among the most influential sanctioning authorities, they are no longer alone, with other jurisdictions expanding or developing their own sanctions frameworks, while regional and supranational organisations continue to play an important role in the implementation of restrictive measures.

General Overview of the Forthcoming Chapters

One of the main objectives of this guide is to provide a comparative overview of how different jurisdictions approach recurrent legal and practical challenges. Contributors will accordingly examine the evolution of sanctions regimes over the past 12 months, the sectors most affected by sanctions regulations, the types of sanctions implemented and the extent to which those measures operate beyond national borders. Contributors will also consider the institutional frameworks through which sanctions are imposed, administered and enforced, thereby highlighting important differences in legal frameworks, regulatory priorities and enforcement.

Interconnectedness of sanctions

One of the recurring themes throughout the present guide is the increasingly global nature of sanctions compliance. In an interconnected economy, organisations frequently find themselves simultaneously targeted by multiple sanctioning authorities, each with its own legal framework, policy objectives and enforcement mechanisms. The result therefore presents a compliance landscape in which most stakeholders in the sanctions industry – but especially financial institutions and professional advisers – must navigate a complex array of obligations.

Extraterritoriality

The question of extraterritoriality occupies a central role in modern sanctions. Many sanctions regimes aim to directly or indirectly influence conduct occurring outside the territory of the sanctioning state. There are several means by which they seek to do this – for instance, through secondary sanctions, or by putting in place restrictions on trade or access to financial markets, which have the potential to impact individuals and entities with few connections to the sanctioning jurisdiction. Contributors will accordingly explore the extent to which sanctions in their respective jurisdictions possess extraterritorial characteristics.

Ownership and control

The guide will also highlight the increasingly important role played by ownership and control analyses. Particularly since 2022, questions surrounding indirect designation through ownership and control have remained some of the most complex and heavily litigated issues in sanctions law. Across multiple jurisdictions, entities may become subject to sanctions restrictions – not because they are expressly designated themselves but because they are owned or controlled by a designated person. Determining whether ownership and/or control exists can involve a highly fact-sensitive analysis of corporate structures, voting rights, governance arrangements, beneficial ownership interests and other indicators of corporate influence. Contributors will therefore examine the legal tests adopted in their jurisdictions and the guidance available to assist stakeholders in navigating such assessments.

Anti-circumvention

Closely linked to these developments is the ever-growing emphasis of governments on anti-circumvention measures, so as to prevent attempts to undermine sanctions through intermediary jurisdictions, complex ownership structures and/or other indirect commercial dealings. As sanctions regimes have expanded, so too have efforts to identify and disrupt mechanisms designed to circumvent them. Indeed, sanctioning authorities typically have the power to impose significant civil or criminal consequences in response to the intended or actual circumvention of sanctions. Acquiring a complete understanding of the scope of anti-circumvention provisions, along with the resulting standards placed on individuals and entities, is a central aspect of sanctions compliance.

Transformations within enforcement

Another prominent theme emerging from the chapters that follow is the continued emphasis on, and development of, sanctions enforcement. In many jurisdictions, the focus appears to have evolved from the rapid introduction of sanctions designations towards ensuring their effective implementation and enforcement. Indeed, in some jurisdictions, regulatory authorities and enforcement bodies have turned their attention to the consolidation of their civil and criminal enforcement measures, resulting in a marked increase of enforcement activity. This trend is reflected in the guide’s examination of the authorities responsible for civil and criminal enforcement and the penalties which may arise from non-compliance.

In this regard, the distinction between civil and criminal enforcement remains an important area of difference between jurisdictions. Some systems continue to reserve criminal penalties for the most serious or deliberate breaches, while others have adopted civil enforcement mechanisms which permit substantial penalties to be imposed without proof of criminal intent. Contributors will accordingly provide an overview of the enforcement frameworks operating within their jurisdictions and insight into significant enforcement actions undertaken during the past three years.

Industries impacted by sanctions

The increasing sophistication of sanctions regimes has transformed sanctions compliance from a specialist legal concern to a core governance issue. As a result, sanctions considerations have become highly influential in commercial decision-making at every stage of a transaction, from due diligence to contract drafting and dispute resolution. Contributors will therefore outline the manner in which sanctions affect numerous and diverse industries.

Licensing

The present guide will further examine the practical mechanisms that underlie sanctions regimes, including licensing frameworks and processes, which are increasingly important tools to maintain the balance between policy objectives and legitimate commercial, humanitarian and/or legal interests. Contributors will consider the grounds upon which licences may be granted, the procedures for obtaining them and the extent to which legal services can be provided to designated persons.

Reporting

Reporting obligations represent another area of increasing complexity. In most jurisdictions, stakeholders impacted by sanctions – such as businesses, financial institutions and professionals – are subject to obligations to identify and report certain assets, transactions or conduct connected to designated persons or prohibited activities. A failure to comply with such obligations may itself constitute a breach, regardless of whether any underlying sanctions violation has occurred. Contributors will accordingly examine the reporting frameworks applicable in their jurisdictions, including the persons subject to reporting obligations, the circumstances in which reports must be made and the authorities to whom such reports should be directed.

Judicial developments

Particularly since 2022, courts have assumed a highly influential role in shaping the interpretation and application of sanctions measures. This guide therefore identifies the most important judicial developments in recent years, with contributors discussing the manner in which the courts have addressed sanctions-related issues, including those arising out of (or resulting in) contractual disputes.

In view of the profound consequences which sanctions designations can have for both individuals and entities (such as by affecting access to assets, financial services and commercial opportunities), the availability of judicial oversight is crucial. Consequently, sanctions regimes will usually provide mechanisms through which designations may be challenged or reviewed, and these are again explored in this guide, as are the remedies which may be obtained (if any) and the practical timeframes involved in pursuing such challenges.

Closing Remarks

Notwithstanding the broad convergence in many states’ responses to recent conflicts and their resulting policy objectives, the approach taken towards the imposition and enforcement of sanctions continues to exhibit key differences between jurisdictions. The comparative perspective offered by this guide serves as a reminder of those differences, from the types of sanctions that jurisdictions impose, and the legal basis upon which those sanctions are adopted, to the operation of licensing frameworks, the perspectives adopted by the courts and the approach taken to enforcement. Understanding such differences is crucial for practitioners and businesses to operate effectively in an increasingly regulated, and regrettably volatile, global market.

The current environment of economic competition and ongoing geopolitical instability gives us every reason to expect that sanctions will remain a critical feature of international relations and foreign policy for the foreseeable future. The manner in which sanctions and enforcement agencies adapt to the challenges presented by this environment will be a key focus over the next 12 months, and will continue to influence the advice given by sanctions practitioners to their clients.

This guide has been prepared against this backdrop, bringing together contributions from dozens of jurisdictions in order to provide a comprehensive and practical overview of the contemporary sanctions landscape, with a view to assisting practitioners and other industry stakeholders in navigating one of the most rapidly evolving and geopolitically significant areas of modern law.