Sanctions and Export Control | UK Regulatory Outlook February 2025

OFSI publishes financial services threat assessment report 

The Office of Financial Sanctions Implementation (OFSI) published its financial services threat assessment report, outlining the threats to sanctions compliance involving UK financial services firms and related professional service providers. 

The report aims to help assist firms take a risk-based approach to compliance by providing information on suspected sanctions breaches. The assessment focuses on transactions handled by financial or credit institutions, including banks and non-bank payment service providers.  

Common compliance issues noted by OFSI include "substantial delays" in identifying and reporting suspected breaches, improper maintenance of frozen assets, breaches of OFSI licence conditions, as well as inaccurate assessments of ownership and UK nexus.  

The report demonstrates OFSI's commitment to investigate breaches of financial sanctions and follows its pledge under its "Economic Crime Plan 2" to publish sectoral sanctions threat assessments, in order to support the industry in their implementation and compliance efforts (see our previous Regulatory Outlook).  

OFSI looks to strengthen collaboration with US counterpart OFAC 

The Office of Financial Sanctions Implementation (OFSI) and the US Department of the Treasury's Office of Foreign Assets Control (OFAC) published a memorandum of understanding (MoU) with the aim of strengthening their collaboration in implementing and enforcing sanctions. 

The MoU codifies the organisations' arrangements including on information sharing, conducting coordinated investigations and training. The memorandum marks the two-year anniversary of OFSI and OFAC's enhanced partnership in global sanctions implementation. See our previous Regulatory Outlook for further details.  

OFSI issues general licence  

OFSI issued the following general licence: 

General Licence INT/2025/5632740, permits payments of up to £350 per month to be made to or for the benefit of designated persons for the purposes of making permitted payments for basic necessities, for up to two months. The general licence takes effect from 15 January 2025 and is of indefinite duration. 

UK sanctions strategy inquiry  

The Foreign Affairs Committee has launched a call for evidence seeking views on whether Parliament should be given greater insight into the UK's sanctions policy and how this can be effectively implemented. 

This follows changes post-Brexit, where Parliament no longer receives prior information on new UK sanctions from the government. Previously, Parliament had a more substantial role in scrutinising autonomous sanctions implemented by the UK through being given information on new EU sanctions before their adoption. 

The inquiry aims to assess how Parliament can conduct scrutiny of the Foreign, Commonwealth and Development Office's sanctions regimes, the appropriate consultation stages, and how scrutiny can improve the effectiveness of sanctions.  

The deadline for written submissions is 17 March 2025.  

Commons issues briefing papers on Russia sanctions 

The House of Commons published two research briefings on the Russia sanctions regime. 

The first briefing contains details of countries that are considered to be supporting Russia's invasion of Ukraine through providing military support to Russia. The House of Commons Library highlights Belarus, Iran, North Korea, and China and sets out the UK, EU and US sanctions imposed against them.  

The second briefing provides an overview of UK sanctions against Russia from February 2022 to January 2025. It gives a helpful summary of the government's purpose for imposing sanctions against Russia, the sanctions the UK has imposed, how the UK has coordinated its sanctions with countries in the G7, EU and the US, as well as links to suggested reading that discusses the effectiveness of sanctions against Russia.