Mr. Sanctions

Category: General Licenses

  • Burning Question: Why is sanctioned goods licensing being transitioned to OTSI?

    The prompt:

    How are sanctioned goods licensed today in the UK? Why is that responsibility being transferred to OTSI? Were there any specific problems with the current situation? Provide sources for your analysis.

    Gemini’s response:

    As of today, April 11, 2026, the licensing of sanctioned goods in the UK is in the final stages of a major structural transition. While the Export Control Joint Unit (ECJU) still handles most “today,” a significant transfer of power to the Office of Trade Sanctions Implementation (OTSI) is scheduled for April 27, 2026.

    Below is an analysis of the current landscape, the reasons for the transfer, and the systemic problems this change aims to solve.

    1. How Sanctioned Goods are Licensed “Today” (April 11, 2026)

    Currently, the responsibility is split between three primary bodies, often requiring businesses to apply for multiple licenses for a single transaction:

    • Export Control Joint Unit (ECJU): Historically the “heavy lifter,” the ECJU remains responsible for licensing strategic goods (military and dual-use items). For another two weeks, they also continue to process licenses for sanctioned goods (non-strategic items heading to sanctioned destinations like Russia).
    • Office of Trade Sanctions Implementation (OTSI): Launched in October 2024, OTSI currently handles the licensing of sanctioned services (e.g., professional, business, and legal services) and enforcement of trade sanctions for activities occurring outside the UK border.
    • Office of Financial Sanctions Implementation (OFSI): Handles the “financial” side (asset freezes and funds), as seen with the Maritime Mutual license discussed previously.

    2. The Transfer to OTSI (Effective April 27, 2026)

    From April 27, 2026, OTSI will take over the licensing of all sanctioned goods and associated ancillary servicesdestined for sanctioned countries.

    • What stays with ECJU: Strategic export controls (military/dual-use goods) will remain under the ECJU to ensure that national security expertise stays centralized.
    • The System: Even after the transfer, exporters will continue to use the SPIRE system for goods, while “standalone” services licenses will remain on the OTSI portal.

    3. Why the Transfer? (Solving Specific Problems)

    The UK Government’s May 2025 Cross-Government Review of Sanctions identified several “frictions” in the pre-2024 system that OTSI was created to fix:

    A. The “Services Gap”

    Before OTSI, the UK had robust enforcement for goods at the border (via HMRC), but enforcement for services (like accounting or consulting provided to sanctioned entities) was fragmented and lacked a dedicated civil enforcement body. OTSI provides a “civil” counterpart to OFSI, specifically for trade.

    B. The Enforcement “Clarity” Problem

    Historically, trade sanctions enforcement was primarily criminal, handled by HMRC. This created a high bar for prosecution. OTSI was granted the power to issue civil monetary penalties (up to £1 million or 50% of the breach value), allowing for more “proportionate and frequent” enforcement action against non-compliant businesses that didn’t meet the threshold for criminal intent.

    C. Administrative Fragmentation

    Businesses previously struggled with “license-stacking.” A single deal might require a financial license from OFSI, a goods license from ECJU, and a services license from the Department for Business and Trade (DBT). Moving sanctioned goods to OTSI concentrates trade-related expertise in one office, reducing the need for businesses to navigate multiple departments for the same sanctions regime.

    D. The “Shadow Fleet” and Circumvention

    Traditional export controls were designed for “shipment-to-destination” tracking. Modern sanctions evasion (like the Russian shadow fleet) often involves complex third-country brokering where goods never touch UK soil. HMRC’s powers are border-centric; OTSI was given broader jurisdiction over UK persons globally, allowing them to target circumvention that occurs entirely outside the UK.

    Source List

    1. OTSI Official Blog (April 9, 2026): “Expanding OTSI’s Licensing Remit” – Confirms the April 27 transition date.
    2. GOV.UK Guidance (March 2026): “UK Government’s Strategic Approach to Sanctions Enforcement” – Details the civil penalty framework and the 2025 cross-government review findings.
    3. OFSI Annual Review 2024-25: Provides data on the increase in license applications and the need for specialized “aftercare” services now being mirrored by OTSI.
    4. Business and Trade Committee Report (February 2026): Correspondence from the Chair regarding the 185 investigations opened by OTSI in its first year, highlighting the “services sector” as the primary source of breaches.
    5. Department for Business and Trade (DBT): “Trade Sanctions, Arms Embargoes, and Other Trade Restrictions”(Updated 2026).

    Analysis of Source Support

    • Fully Supported: The dates of the transfer, the new civil penalty limits, and the split between strategic and sanctioned goods.
    • Inferred/Expert Analysis: The “Administrative Fragmentation” point is a common industry critique found in legal briefings (e.g., from Clifford Chance and Linklaters) and was a central theme of the 2025 review, though the government describes it more diplomatically as “improving the user experience.”

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  • April 9, 2026: OFSI extends Russia maritime reinsurance General Licence to July 8th

    Office of Financial Sanctions Implementation HM Treasury

    OFSI General Licence INT/2026/8893924 extended

    On 09 April 2026, the General Licence INT/2026/8893924 was extended to 08 July 2026.

    Any persons intending to use General Licence INT/2026/8893924 should consult the copy of the Licence for full details of the permissions and usage requirements.

    Here”s the GL:

    Maritime_Mutual_INT-2026-8893924_GL_-_ExtendedDownload

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  • April 8, 2026: OFAC updates Russian General License 13 & associated Frequently Asked Questions

    Today, OFAC issued Russia-related General License 13Q:

    russia_gl13qDownload

    and updated two FAQs:

    1118. As of December 2022, the Government of the Russian Federation may require a so-called “exit tax” payment prior to the divestment of assets located in the Russian Federation, potentially requiring transactions involving the Central Bank of the Russian Federation or the Ministry of Finance of the Russian Federation. Do U.S. sanctions prohibit the payment of this so-called “exit tax”? Does Russia-related General License (GL) 13Q authorize transactions that involve the payment of this exit tax? 

    Directive 4 under Executive Order (E.O.) 14024, “Prohibitions Related to Transactions Involving the Central Bank of the Russian Federation, the National Wealth Fund of the Russian Federation, and the Ministry of Finance of the Russian Federation,” as amended (Russia-related Sovereign Transactions Directive), prohibits the following activities by U.S. persons: any transaction involving the Central Bank of the Russian Federation, the National Wealth Fund of the Russian Federation, or the Ministry of Finance of the Russian Federation, including any transfer of assets to such entities or any foreign exchange transaction for or on behalf of such entities (collectively, “Directive 4 entities”). As noted in FAQ 1002, this includes both direct and indirect transactions.

    OFAC issued the Russia-related Sovereign Transactions Directive with the explicit aim of preventing the Government of the Russian Federation from leveraging these institutions and their holdings of international reserves in ways that would undermine the impact of U.S. sanctions. Information currently available to OFAC suggests so-called “exit taxes” imposed by the Government of the Russian Federation involve payments to Directive 4 entities. Consequently, U.S. persons whose divestment from the Russian Federation will involve the payment of such an exit tax require a specific license from OFAC prior to the payment of such tax, unless otherwise authorized by OFAC.

    GL 13Q authorizes U.S. persons, or entities owned or controlled, directly or indirectly, by a U.S. person, to pay taxes, fees, or import duties, and purchase or receive permits, licenses, registrations, or certifications involving Directive 4 entities that would otherwise be prohibited by the Russia-related Sovereign Transactions Directive, provided such transactions are ordinarily incident and necessary to such persons’ day-to-day operations in the Russian Federation. Payment of exit taxes is not considered ordinarily incident and necessary to day-to-day operations in the Russian Federation and, thus, is not authorized under GL 13Q.

    Therefore, U.S. persons whose divestment of assets in the Russian Federation will involve a payment of such an “exit tax” should seek a specific license from OFAC. Such persons may submit a request for a specific license with OFAC’s Licensing Division online at https://ofac.treasury.gov/ofac-license-application-page. License applications related to these payments should include information regarding the amount of the exit tax, the amount of ongoing taxes that would otherwise be paid to the Government of the Russian Federation should divestment not occur, the impact of a failure to pay the tax on the employees of the exiting company, the specific economic activity in Russia of the exiting company, and the impact on the Russian Federation of the divestment. OFAC will expedite its review of such requests, which will be evaluated on a case-by-case basis.

    While OFAC is aware that the Commission established by the Russian Federation to review such divestments may include individuals from entities subject to the Russia-related Sovereign Transactions Directive or individuals listed on the Specially Designated Nationals and Blocked Persons List, U.S. persons do not need to seek authorization from OFAC for their Russian buyers to submit an application to the Commission regarding a divestment transaction.

    Date Updated: April 08, 2026

    Updated on Apr 08, 2026

    Russian Harmful Foreign Activities Sanctions

    999. What authorizations exist for entities subject to Directive 4 under Executive Order (E.O.) 14024, “Prohibitions Related to Transactions Involving the Central Bank of the Russian Federation, the National Wealth Fund of the Russian Federation, and the Ministry of Finance of the Russian Federation,” as amended (Russia-related Sovereign Transactions Directive)? 

    OFAC issued Russia-related General License (GL) 132 to authorize transactions involving the Paks II civil nuclear power plant project in Hungary, including those involving the Central Bank of the Russian Federation, that would be prohibited by the Russia-related Sovereign Transactions Directive.

    OFAC issued Russia-related General License (GL) 115C to authorize civil nuclear energy-related transactions, including those involving the Central Bank of the Russian Federation, that would be prohibited by the Russia-related Sovereign Transactions Directive.

    OFAC issued GL 13Q to authorize U.S. persons to pay taxes, fees, or import duties and purchase or receive permits, licenses, registrations, or certifications, to the extent such transactions are prohibited by the Russia-related Sovereign Transactions Directive, provided such transactions are ordinarily incident and necessary to such persons’ day-to-day operations in the Russian Federation. For further information on the types of transactions authorized by GL 13Q, see FAQ 1118.

    OFAC also issued GL 14, authorizing certain transactions involving any Directive 4 entity where the Directive 4 entity’s sole function in the transaction is to act as an operator of a clearing and settlement system. GL 14 does not authorize any transfer of assets to or from any Directive 4 entity, or any transaction where a Directive 4 entity is either a counterparty or beneficiary to the transaction. In addition, GL 14 does not authorize any debit to an account on the books of a U.S. financial institution of any Directive 4 entity. See FAQ 1003.

    Note that GL 13Q, GL 14, GL 115C, and GL 132 continue to authorize against the Russia-related Sovereign Transactions Directive.

    Date Updated: April 08, 2026

    Updated on Apr 08, 2026

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  • April 8, 2026: ¿Habla usted OFAC?

    From today’s OFAC Recent Actions page:

    OFAC has published Spanish translations of Venezuela General License 46B, “Authorizing Certain Activities Involving Venezuelan-Origin Oil or Petrochemical Products;” Venezuela General License 47, “Authorizing the Sale of U.S.-Origin Diluents to Venezuela;” Venezuela General License 48A, “Authorizing the Supply of Certain Items and Services to Venezuela;” Venezuela General License 49A, “Authorizing Negotiations of and Entry Into Contingent Contracts for Certain Investment in Venezuela;” and Venezuela General License 50A, “Authorizing Transactions Related to Oil or Gas Sector Operations in Venezuela of Certain Entities.” The translations of these General Licenses are available at this link, and the translations of 19 associated Frequently Asked Questions are available at this link. Note: These Spanish translations are for informational purposes only.

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  • April 2, 2026: You were wondering where Notice to Exporters 2026/08 went, weren’t you?

    NTE 2026/08: general trade licence Russia sanctions – sectoral software and technology

    Introduction

    Following the coming into force of The Russia (Sanctions) (EU Exit) (Amendment) Regulations 2025 on legislation.gov.uk, the Export Control Joint Unit (ECJU) published the general trade licence Russia sanctions: sectoral software and technology.

    The licence came into force on 21 July 2025 and is due to expire on 17 April 2026.

    We are extending the validity of this general trade licence to provide additional time for licensing processes to be completed, ensuring that legitimate use of sanctioned software and technology can continue without disruption.

    For any questions about the impact of these sanctions on UK businesses operating in any sector, or business operations in Ukraine or Russia, contact the export support team. The export support team are providing a front-line Russia sanctions support service to all businesses.

    Contact ECJU

    For general queries about strategic export licensing, contact the ECJU at:

    Export Control Joint Unit
    Department for Business and Trade
    Old Admiralty Building
    Admiralty Place
    London
    SW1A 2DY

    Email: exportcontrol.help@businessandtrade.gov.uk

    Telephone: 020 7215 4594

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  • April 1, 2026: OFAC issues more aggressive guidance, a General License and FAQs about the Shadow Fleet

    U.S. DEPARTMENT OF THE TREASURY

    Office of Foreign Assets Control

    April 1, 2026

    Publication of Sanctions Advisory: Guidance on Identifying “Non-Standard Maritime Silhouettes” and Active Camouflage within the Shadow Fleet

    The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC), in coordination with the U.S. Department of State and the U.S. Coast Guard, is issuing this advisory to alert the maritime industry to “Visual Signal Obfuscation” (VSO) tactics currently employed by the Shadow Fleet to circumvent the G7+ Price Cap and avoid detection in high-traffic corridors.

    As outlined in Executive Order 14501, “Addressing Extra-Territorial Maritime Deception,” U.S. persons are advised that the use of “Trompe-l’œil” hull painting, inflatable superstructure extensions, and “active-chameleon” heat-shielding technology constitutes a significant evasion risk.

    Regulatory Concerns: The “Iceberg” and “Megayacht” Protocols

    OFAC has identified a trend where sanctioned crude oil tankers are undergoing structural modifications to appear as non-sanctioned vessel types when viewed from satellite or aerial surveillance. Recent findings include:

    • Pseudo-Leisure Conversions: Tankers utilizing magnetic “hull-wraps” to mimic the visual signature of luxury pleasure craft or research vessels.
    • Active Camouflage (AC): The application of light-refractive coatings that cause the vessel to blend into sea-state patterns or, in Arctic routes, mimic the geometric profile of large icebergs.
    • Bio-Mimicry Signatures: The deployment of acoustic decoys that broadcast the frequency of migratory whale pods to confuse sonar-based tracking systems.

    Compliance Expectations

    Marine insurers, port authorities, and bunkering services are expected to conduct “Optical Due Diligence.” If a vessel’s length-to-beam ratio appears to “shimmer” or fluctuate during daylight hours, it must be flagged as a “Potential Visual Evasion Event” (PVEE).

    And a new General License:

    GL 1-APRDownload

    And a new Frequently Asked Question:

    Frequently Asked Question (FAQ) 1401

    Q: My satellite imagery shows a tanker that looks like a giant floating rubber duck. Is this a sanctioned vessel?

    A: Possibly. Under the “Strict Liability” standard, the internal cargo (crude oil) determines the sanctions status, regardless of whether the external hull is yellow, buoyant, or has a beak. OFAC recommends that you do not “squeeze” the duck until you have verified the Ultimate Beneficial Owner (UBO) via the hotline at 1-800-APR-FOOL.

    oh, and one more thing, in case it wasn’t clear…

    Thanks a bunch, Gemini! April Fool!

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  • March 31 Sanctions-palooza: Notice to exporters 2026/09: change to the Open Individual Export Licence (OIEL) amendments process

    Notice

    NTE 2026/09: Change to the Open Individual Export Licence (OIEL) amendments process

    Published 30 March 2026

    Introduction

    The Export Control Joint Unit (ECJU) is changing the way it accepts amendment requests for Open Individual Export Licences (OIELs).

    When ECJU will accept amendment requests

    ECJU will accept amendment requests for OIELs in the following circumstances:

    • changes to exporter details (such as site or registered addresses)
    • amendments or additions to named recipient details for an existing destination (name and address)
    • requests to extend an extant OIEL, where a renewal application has already been submitted

    When ECJU will not accept amendment requests

    ECJU will no longer accept amendment requests for the following circumstances:

    • amendments or additions to goods
    • amendments or additions to destinations

    Reason for this change

    Processing substantive amendments to an Open Individual Export Licence (OIEL) takes as long as, or longer than, assessing a new licence application. This type of amendment is also not currently available on the LITE licensing system, which is used for online export licence applications.

    If you have any questions, please contact ecjulicensingunit@businessandtrade.gov.uk

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  • March 31, 2026 Sanctions-palooza: OFSI amends 2 General Licenses

    Office of Financial Sanctions Implementation HM Treasury

    OFSI General Licences INT/2022/2300292 and INT/2022/2009156 amended

    On 31 March 2026, the General Licence INT/2022/2300292, Payments to Utility Companies for Gas and Electricity by UK Designated Persons who Own or Rent Properties in the UK was amended to to permit all forms of utility payment, including cash.

    Any persons intending to use General Licence INT/2022/2300292 should consult the copy of the Licence for full details of the permissions and usage requirements.

    Publication Notice:

    PN_Gas_and_Electicity_INT-2022-2300292Download

    The General Licence:

    GL_Gas_and_Electricity_INT-2022-2300292Download

    On 31 March 2026, the General Licence INT/2022/2009156, Permitted Payments to UK Insurance Companies was amended to allow designated persons to make IPF repayments to UK intermediaries rather than insurers or brokers.

    Any persons intending to use General Licence INT/2022/2009156 should consult the copy of the Licence for full details of the permissions and usage requirements.

    The Publication Notice:

    PN_Insurance_INT-2022-2009156Download

    The General Licence:

    GL_Insurance_INT-2022-2009156Download

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  • March 30, 2026: New version of OFAC Lukoil International GmbH-related General License and 2 updated Frequently Asked Questions

    Today, OFAC issued Russia-related General License 131D (Authorizing Certain Transactions for the Negotiation of and Entry Into Contingent Contracts for the Sale of Lukoil International GmbH and Related Maintenance Activities):

    russia_gl131dDownload

    and updated FAQs 1224:

    1224. What negotiations does Russia-related General License 131D authorize, and what transaction conditions will OFAC consider when evaluating requests for further authorization to effectuate a sale of Lukoil International GmbH (LIG) assets?

    Answer

    On October 22, 2025, OFAC designated Public Joint-Stock Company Oil Company Lukoil (Lukoil) to increase pressure on Russia’s energy sector and degrade Russia’s ability to raise revenue for its war machine. OFAC is aware of potential efforts by Lukoil to divest its assets outside of Russia to non-blocked parties, given the impact of sanctions. To support such divestments and further cut off funding to Russia, OFAC issued Russia-related General License (GL) 131D, which authorizes negotiations and entry into contingent contracts with Lukoil for the sale of LIG or any of LIG’s majority-owned subsidiaries. Authorized activities include negotiations on terms for definitive agreements and financial, legal, or operational due diligence, including engagement of outside counsel or advisors. GL 131Dexpires on May 1, 2026.

    GL 131D does not authorize transactions to effectuate the actual sale, disposition, or transfer of any LIG entity or asset. Any contract entered into pursuant to GL 131D must expressly be made contingent upon the receipt of a separate authorization from OFAC. The goal of OFAC’s Russia sanctions is to place pressure on Moscow to end its war.

    As such, Treasury would evaluate any proposed sale of LIG based on factors that support U.S. national security and foreign policy objectives. OFAC expects that, at a minimum, the proposed transaction must: completely sever LIG’s ties with Lukoil; block any funds owed to Lukoil until sanctions are lifted by placing them in an account subject to U.S. jurisdiction; and not provide a windfall to Lukoil, such as by providing up-front value to Lukoil, including through asset or share swaps. Further, as a condition of any future license for effectuating a sale of LIG, OFAC expects that it will require persons purchasing LIG’s assets to seek OFAC review before further divestment of material LIG assets.

    OFAC may revoke GL 131D at any time, including if Lukoil and LIG do not appear to be engaging in good faith negotiations regarding the divestment of LIG or its assets.

    Date Updated: March 30, 2026

    Date Released

    November 19, 2025

    and 1225:

    1225. What activities do Russia-related General License 128B and General License 131D authorize related to Lukoil International GmbH (LIG)?

    Answer

    OFAC has issued two General Licenses (GLs) relating specifically to Lukoil International GmbH (LIG) and its majority-owned subsidiaries (“LIG Entities”): GL 128B and GL 131D. The GLs are similar but have different expiration dates and terms as each serves a different purpose.

    • To mitigate the effects of Lukoil’s OFAC designation on retail consumers, OFAC issued on December 4, 2025 GL 128B to authorize maintenance, operation, and wind down activities for a narrow range of LIG entities, specifically Lukoil retail automobile service stations outside of the Russian Federation. GL 128B expires on April 29, 2026.
    • To enable Lukoil to divest its assets outside of Russia to non-blocked parties, OFAC issued on December 10, 2025 GL 131A to authorize, among other things, maintenance and wind down activities of all LIG Entities. OFAC subsequently issued GL 131B, GL 131C, and GL 131D to extend the existing authorization until May 1, 2026. Please see Frequently Asked Question 1224 for additional information on authorizations regarding negotiations for the sale of LIG Entities.

    GL 128B and GL 131D expressly authorize transactions undertaken in the ordinary course of business, provided that the transactions do not involve any blocked persons other than the LIG Entities described in GL 128B and GL 131D. Transactions undertaken in the ordinary course of business may involve (but are not limited to): supply of motor fuel and lubricants; lease payments; insurance payments; property maintenance and environmental services; employee payroll, benefits, severance, and reimbursements; information technology services; payments to government authorities; legal services and proceedings; payments to suppliers, landlords, lenders, and partners; the preservation and upkeep of pre-existing tangible property; and activities associated with maintaining pre-existing capital investments. Also, both GL 128B and GL 131D authorize transactions ordinarily incident and necessary to performing pre-existing agreements and conducting intracompany transfers, provided that such transactions are consistent with previously established practices and support pre-existing projects or operations, consistent with the terms of the respective authorizations.

    Both GL 128B and GL 131D also authorize financial institutions, payment processors, and other entities to use, debit, and credit the accounts of the relevant LIG Entities to effectuate the respective authorizations, but both GLs are also expressly limited by the condition that no funds may be transferred to a person or account in the Russian Federation.

    Non-U.S. persons generally do not risk exposure to U.S. sanctions under E.O. 14024 for engaging in transactions with blocked persons that are generally authorized for U.S. persons, including for those authorized by GL 128B and GL 131D. Similarly, non-U.S. persons may rely upon GL 128B and GL 131Dregardless of whether a foreign financial institution maintains blocked accounts, provided the non-U.S. person’s activities are consistent with the terms of GL 128B and GL 131D, including the requirement that no payments may be transferred to any person or account located in the Russian Federation.

    Date Updated: March 30, 2026

    Date Released

    December 4, 2025

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  • March 27, 2026: A Miner Set of OFAC GLs for Venezuela

    Earlier this evening, OFAC issued a new version of Venezuela General License (GL) 51 (Authorizing Certain Activities Involving Venezuelan-Origin Minerals, Including Gold):

    venezuela_gl51aDownload

    and new GLs 54 (Authorizing the Supply of Certain Items and Services for Minerals Operations in Venezuela):

    venezuela_gl54Download

    and 55 (Authorizing Negotiations of and Entry Into Contingent Contracts for Certain Investment in Venezuela’s Minerals Sector):

    venezuela_gl55Download

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