On June 23, 2026, the US Department of the Treasury’s Office of Foreign Assets Control (OFAC) and His Majesty’s Treasury’s Office of Financial Sanctions Implementation (OFSI) published joint guidance (Guidance) setting out important similarities and differences between the two sanctions regimes. The Guidance is published under OFAC-OFSI Enhanced Partnership, which is now into its fifth year, and aims to help private sector actors understand their multijurisdictional sanctions compliance obligations.
The Guidance covers the core aspects of both US and UK sanctions, such as key terminology, sanctions types/programs, sanctions lists, jurisdiction, prohibited activities, permitted activities, recordkeeping, reporting, licensing and enforcement rules. Importantly, the Guidance serves as a reminder that although the US and UK share many of the same sanctions compliance goals, there are enough differences in their respective regulatory frameworks to warrant a close review to ensure that all applicable rules and regulations have been complied with, particularly when cross-border transactional activity is involved.
In the table below, we summarize several of the key points of comparison from the Guidance.
| Key points | OFAC | OFSI |
|---|---|---|
| Organization basics | OFAC administers and implements its numerous sanctions programs in accordance with various US legal authorities, including statutes, executive orders, regulations and laws implementing UN Security Council Resolutions, and enforces against civil violations of its economic, financial and trade sanctions. | OFSI administers and implements its multiple sanctions regimes in accordance with UK legal authorities such as primary and secondary legislations and laws implementing the UN Security Council Resolutions, and enforces against breaches of its financial sanctions. |
| Sanctions types/programs | • List-based blocking sanctions • List-based non-blocking sanctions • Sector-based sanctions • Government blocking • Jurisdiction-based sanctions • Secondary sanctions |
• List-based financial sanctions • Sectoral sanctions • Directions OFSI does not impose blanket or “comprehensive” country-based sanctions. |
| Sanctions lists | • Specially Designated Nationals and Blocked Persons List (SDN List) • Several “non-SDN” sanctions lists (e.g., the Non-SDN Menu-Based Sanctions List) OFAC refers to individuals and entities on the SDN List as “SDNs” or “blocked persons.” Individuals and entities that are subject to less than full blocking sanctions (i.e., “non-SDNs”) appear on the non-SDN sanctions lists. |
The UK Foreign, Commonwealth and Development Office (FCDO) maintains the UK Sanctions List for persons financially sanctioned under the primary legislation Sanctions and Anti-Money Laundering Act 2018 (SAMLA).
OFSI refers to individuals and entities on the UK Sanctions List as “designated persons” or “DPs.” OFSI may require UK persons to freeze certain prohibited transactions or assets. The term “asset” covers funds (financial assets) or economic resources that are any tangible or intangible assets that are not funds, but can be used to obtain funds, goods or services. |
| Jurisdiction | OFAC has jurisdiction over “US persons,” which include all US citizens and permanent residents regardless of where they are located, all individuals and entities within the US and all US incorporated entities and their foreign branches. Transactions within or transiting the US also must comply with OFAC sanctions.
OFAC sanctions also apply extraterritorially, and prohibit non-US persons causing or conspiring to cause US persons to violate US sanctions and from engaging in conduct that evades US sanctions. For certain OFAC sanctions programs, compliance obligations extend to (i) non-US subsidiaries of US persons, and (ii) non-US persons reexporting goods, technology or services from the US (even if no US persons are involved in the reexport). |
OFSI has jurisdiction over all UK persons regardless of where they are located, all individuals and entities within the UK and legal entities incorporated or constituted under UK law and their foreign branches. Activities occurring within the UK or its territorial sea also must comply with OFSI sanctions.
OFSI may have jurisdiction over non-UK persons if they have a UK nexus and fall within the UK jurisdiction as a result. Separately, UK sanctions legislation also has reporting requirements for relevant firms and relevant institutions that provide specific services to sanctioned persons. |
| Licensing/Reporting | OFAC may authorize US persons to conduct certain prohibited activities and transactions by issuing “general” or “specific” licenses. OFAC generally requires persons who engage in activities subject to sanctions to keep their records for at least 10 years from the date of the activity, though OFAC licenses may be subject to additional recordkeeping requirements. US persons who hold blocked property as of June 30 of a particular year are required to provide an Annual Report of Blocked Property (ARBP) to OFAC by September 30 of that same year. Furthermore, actions such as holding, unblocking or transferring blocked property are subject to a 10-day reporting requirement. | In addition to some activities being exempt from sanctions, OFSI may authorize UK persons to conduct certain prohibited activities and transactions by issuing licenses. There are two types of licenses OFSI issues: general and specific licenses. The UK sanctions legislation does not specifically determine for how long records must be retained and the requirement is therefore the general recordkeeping requirement under the applicable UK law. Nevertheless, OFSI licenses may have additional specific recordkeeping requirements. OFSI also has the mandatory Annual Frozen Asset Review (AFAR) filing, requiring all persons who hold assets belonging to a designated person as of September 30 of that year to make a submission to OFSI by November 30 of each year.
OFSI has no reporting requirement for rejecting a prohibited transaction. |
| Liability | OFAC applies a strict liability legal standard to potential sanctions violations, and thus, a person subject to US jurisdiction may be held civilly liable even if such person did not have knowledge that they violated OFAC sanctions.
OFAC investigations of potential sanctions violations may result in the following: • No action OFAC encourages voluntary disclosures, which it incentivizes by offering a potential 50 percent reduction to any civil monetary penalty. In the enforcement context, OFAC assesses a variety of factors to determine the appropriate administrative action, including: • Wilful or reckless violation of law The statute of limitation for OFAC enforcement actions is 10 years from the date of the latest sanctions violation. |
For sanctions breaches occurring after June 15, 2022, OFSI may impose civil penalties based on a strict liability legal standard, and thus, a person subject to the UK’s jurisdiction may be held liable even if such person did not have knowledge that they were breaching OFSI sanctions. For sanctions breaches occurring before June 15, 2022, OFSI must prove that there was a sanctions breach, and the person in question had knowledge or reasonable cause to suspect that they were in breach or failed to comply with an obligation.
OFSI investigations of sanctions breaches may result in the following circumstances or may be referred to law enforcement agencies for criminal investigation and potential prosecution: • No action However, OFSI encourages voluntary disclosure, including by possibly applying a 30 percent reduction to a civil monetary penalty. OFSI may consider a variety of factors in terms to assess its administrative action. These factors include: • Circumvention of sanctions OFSI may consider other factors in case they are relevant to a specific case. There is generally no statute of limitation for OFSI enforcement actions. |
