Sanctions - Iran

Iran has been subject to international sanctions for several decades, with the earliest US measures introduced in response to the 1979 hostage crisis.

A diplomatic agreement the Joint Comprehensive Plan of Action (JCPOA) was reached on 14 July 2015, and so-called "Implementation Day" occurred on 16 January 2016, on which date many nuclear-related sanctions were lifted. In May 2018, President Trump unilaterally withdrew the United States from the JCPOA and reimposed US secondary sanctions.

This also resulted in the reimposition by the European Union and the United Kingdom of all UN Security Council restrictions on Iran that had been suspended under the Joint Comprehensive Plan of Action (JCPOA), including restrictions on conventional arms transfers, ballistic missiles, nuclear-related items, and associated financial measures.

The current multi-layered sanctions framework reflects three overlapping sets of concerns:

(i) Iran's nuclear programe and the risk of nuclear weapons proliferation;

(ii) widespread and systematic violations of human rights and repression of civil society; and

(iii) Iran's role as a state sponsor of terrorism and its supply of weapons principally drones and ballistic missiles to Russia's war of aggression against Ukraine and to armed groups operating across the Middle East and Red Sea region.

The United States operates a near-comprehensive embargo against Iran, supplemented by secondary sanctions provisions with extraterritorial reach.

The United Kingdom, since introducing consolidated autonomous legislation in December 2023 (Iran (Sanctions) Regulations 2023), operates a coherent unified regime covering human rights, hostile activity, and nuclear-related measures.

The European Union maintains three overlapping but distinct sanction tracks: a long-standing nuclear-related regime under Council Regulation (EU) No 267/2012; a human rights regime under Council Regulation (EU) No 359/2011; and, since July 2023, a dedicated regime targeting Iran's military support for Russia's war of aggression and for armed groups in the Middle East and the Red Sea region.

United States

President Trump announced on 8 May 2018 that the US would unilaterally withdraw from the JCPOA and that secondary sanctions were to be reimposed. The Club issued New Items concerning the announcement on 9 May and 15 May 2018 and the Club’s U.S. attorneys Freehill Hogan & Mahar have provided guidance in a Client Alert, all of which Members are strongly advised to read.

OFAC publishes Iran Sanctions -related FAQS, which can be found here Frequently Asked Questions. A News Item on the reimposition of US secondary sanctions was published by the Club on 7 August 2018 and Freehill Hogan & Mahar also published a further Client Alert.

President Trump reinstated a policy of 'maximum pressure' on Iran, directing OFAC to implement a robust and continuous sanctions enforcement campaign targeting Iran's petroleum supply chains, its terror proxies, and its financial infrastructure. This has resulted in an exceptionally high volume of new designations throughout 2025, including against foreign shipping companies, oil brokers

Prohibitions

Comprehensive Trade Embargo (31 CFR Part 560)

The Iranian Transactions and Sanctions Regulations (ITSR) impose a near-total embargo on transactions between US persons and Iran:

• Prohibition on the exportation, reexportation, sale, or supply of goods, technology, or services from the United States, or by a US person, directly or indirectly, to Iran or the Government of Iran — whether for ultimate destination in Iran or for onward supply to a third country.

• Prohibition on the importation into the United States of Iranian-origin goods, services, or technology, either directly or through third countries.

• Prohibition on any transaction or dealing in Iranian-origin goods that are located outside the United States by US persons.

• Prohibition on facilitation by US persons of transactions between non-US persons that would be prohibited if performed by a US person.

• Prohibition on new investment in Iran by US persons, including participation in joint ventures.

• Prohibition on the approval, financing, facilitation, or guarantee of a transaction by a foreign person if that transaction would be prohibited for a US person.

Sectoral Sanctions - Petroleum, Petrochemicals, and Shipping

E.O. 13846 and E.O. 13902 empower OFAC to impose blocking sanctions on persons operating in designated sectors of the Iranian economy. The petroleum and petrochemical sector is the primary focus of ongoing maximum pressure enforcement:

• Prohibition on the purchase or acquisition of petroleum, petroleum products, or petrochemical products of Iranian origin, whether or not originating in Iran by name (including where cargoes have been disguised or blended to obscure origin).

• Prohibition on providing or facilitating the provision of significant financial, material, technological, or other support to the National Iranian Oil Company (NIOC), National Iranian Tanker Company (NITC), or any designated Iranian entity.

• Shipping sector: Any vessel designated as blocked property is subject to the standard blocking regime. All US persons are prohibited from dealing with any designated vessel; foreign persons dealing with such vessels may themselves become subject to designation.

• Port access: Persons that knowingly conduct or facilitate a significant transaction with a person blocked under E.O. 13846 may be subject to correspondent account or payable-through account restrictions under the IFSR.

Deceptive shipping practices: OFAC's April 2025 Shipping Advisory documents the extensive use by Iran of AIS manipulation, ship-to-ship (STS) transfers, flag switching, falsified cargo documentation, and use of shadow fleet tankers to conceal the origin and movement of Iranian petroleum. Members are warned that involvement in such transfers — even unknowingly — may result in designation.

Arms and WMD-Related Prohibitions

• Prohibition on the exportation or supply to Iran of any item on the US Munitions List (USML) or the Commerce Control List (CCL) that requires a licence for export to Iran — virtually all controlled goods require such a licence and licences are generally unavailable for Iranian end-users.

• Prohibition on providing material support to the Islamic Revolutionary Guards Corps (IRGC) or any affiliated entity — the IRGC has been designated as a Foreign Terrorist Organization (FTO) since April 2019.

• Prohibition on transactions involving persons connected with Iran's ballistic missile or UAV programmes. The October 2023 Iran Ballistic Missile Procurement Advisory and the June 2023 Iran UAV Guidance detail specific evasion methods and supply chains.

• E.O. 13949 authorises designation of persons involved in the supply of conventional arms to Iran in breach of UNSCR 2231.

Asset Blocking

All property and interests in property of any SDN that are in the United States, or that come within the possession or control of a US person, are blocked. The 50% rule applies: entities 50% or more directly or indirectly owned by one or more blocked persons are also blocked, regardless of whether separately listed.

Exemptions and General Licences (relevant to shipping)

• Food and medicine: The ITSR contains a standing exemption for the exportation of food and agricultural commodities, medicine, and medical devices to Iran — subject to the Trade Sanctions Reform and Export Enhancement Act of 2000 (TSRA) licensing process for commercial transactions, and a general licence for personal or humanitarian exports.

• Communications technology (31 CFR § 560.540 — effective 17 May 2024): Authorises the export to Iran of specified services, software, and hardware incident to personal communications, internet connectivity, and anti-censorship tools. This provision was amended in May 2024 to incorporate former General Licence D-2 and to restrict high-performance computing devices (APP exceeding 1 Weighted TeraFLOP).

All general licences are set out in 31 CFR Part 560 or published as separate named instruments on the OFAC website. Any activity not falling within a general licence requires a specific licence from OFAC.

Member Advisory

If Members are continuing to trade with Iran with cargoes which are not currently subject to sanctions (such as food, agricultural commodities, medicines and humanitarian goods), they are reminded that it is prohibited for non-US persons to deal with any entity which remains on the US list of Specially Designated Nationals (please see below) and to engage in conduct that seeks to evade continuing US sanctions.

Members should also note that the continuing US primary sanctions not only prevent US-owned or controlled tonnage from trading to Iran and US-based insurers and reinsurers from involvement in claims concerning Iran or Iranian entities (see the "Club Cover" section below), importantly it also prevents US banks from handling any financial transaction which involves Iran. Any trade to or from Iran or which involves Iranian entities must consequently be structured so that all transactions are made in a currency other than US Dollars. Endeavouring to mask the fact that a payment in US Dollars is linked with an Iranian transaction in an effort to induce a US bank into handling the transaction will be a breach of sanctions.

Specially Designated Nationals (SDNs)

Members should ensure that they check all the parties to a transaction - e.g. charterer, shipper, physical supplier (if different), consignee, receiver (if different), local agents, banks and cargo insurers (where known) - against those lists before undertaking any trade with Iran or involving Iranian entities. Trading with SDNs may expose Members to severe penalties for breaching sanctions including the possible loss of insurance cover.

The US list can be checked via the OFAC's Sanctions List Search webpage.

Relevant Resources

· OFAC Iran Sanctions (main page)

· OFAC Iran Sanctions FAQ Topic Page

· Guidance for Shipping/Maritime Stakeholders on Iranian Oil Sanctions Evasion (April 2025)

· Iran Ballistic Missile Procurement Advisory (October 2023)

· Guidance to Industry on Iran's UAV-Related Activities (June 2023)

· Guidance on Illicit Shipping and Sanctions Evasion Practices (May 2020)

· Deceptive Practices re Iran and Civil Aviation (July 2019)

· Financial Channels for Humanitarian Trade with Iran (October 2019)

· Guidance on Legal Fees from Blocked Funds

· TSRA Licensing Programme — Food, Medicine, Medical Devices

European Union

The EU operates three distinct but overlapping Iran sanctions regimes:

• Nuclear regime - Council Decision 2010/413/CFSP (as amended) and Council Regulation (EU) No 267/2012 (as amended, consolidated to 30 September 2025): targeting Iran's nuclear programme; implementing UN Security Council resolutions and autonomous EU measures. As of 29 September 2025, this regime has been significantly expanded through the snapback mechanism (see below).

• Human rights regime - Council Decision 2011/235/CFSP (as amended) and Council Regulation (EU) No 359/2011 (as amended): targeting persons responsible for serious violations of human rights in Iran; renewed annually, last extended until 13 April 2026.

• Military support regime - Council Decision (CFSP) 2023/1532 (as amended, consolidated to 26 July 2025) and Council Regulation (EU) 2023/1529 (as amended): targeting persons involved in Iran's supply of drones, missiles, and related technology to Russia and to armed groups in the Middle East and Red Sea region; last extended until 27 July 2026.

All three frameworks are binding on EU natural and legal persons wherever located, and on all persons within the EU.

The snapback: On 29 September 2025, the European Union adopted Council Regulation (EU) 2025/1975 implementing the snapback of UN Security Council restrictions on Iran. This reimposed all UN-mandated measures that had been suspended under the JCPOA, including restrictions on conventional arms, ballistic missiles, nuclear-related items, and associated financial measures. This is one of the most significant expansions of the EU's Iran regime since 2012 and substantially increases the scope of prohibited transactions.

Prohibitions

Asset Freeze and Funds Prohibition (All Three Regimes)

All funds and economic resources belonging to, owned, held, or controlled by listed persons are frozen. EU persons and entities are prohibited from:

• Making available, directly or indirectly, any funds or economic resources to listed individuals or entities.

• Participating, knowingly and intentionally, in activities the object or effect of which is, directly or indirectly, to circumvent the freeze.

• The 50% rule applies: entities owned or controlled 50% or more by a listed person are subject to equivalent restrictions.

Nuclear-Related Trade Prohibitions (Regulation No 267/2012)

The nuclear sanctions regulation imposes the following trade prohibitions:

• Sale, supply, transfer, or export to Iran of nuclear-related goods and technology listed in Annexes I and II to the Regulation (goods that could contribute to enrichment-related, reprocessing, heavy-water, or nuclear weapon delivery activities, as identified by the IAEA or UN Security Council).

• Sale, supply, or transfer of dual-use goods and technology (Annex I to Regulation (EU) 2021/821) to Iran where the goods could contribute to nuclear or missile programmes — subject to prior authorisation from the competent Member State authority.

• Sale, supply, transfer, or export of key equipment and technology for the oil, gas, and petrochemical industry (Annex VI) without prior authorisation — broadly construed to include exploration, production, and refining infrastructure.

• Sale, supply, or transfer of graphite, and raw or semi-finished metals, including aluminium and steel, to Iranian persons or for use in Iran.

• Supply of software for integrating industrial processes relevant to Iran's oil, gas, and petrochemical industry.

• Embargo on arms and related materiel to Iran: comprehensive prohibition on transfer of weapons, ammunition, and military equipment.

• Investment in the Iranian oil, gas, and petrochemical sector, including acquisition of a shareholding or interest in an enterprise, and joint ventures.

• Provision of financial services - insurance and reinsurance - in connection with Iranian petroleum or gas imports into the EU.

• Import of crude oil and petroleum products of Iranian origin into the EU.

• Import of petrochemical products of Iranian origin into the EU.

• Import of Iranian-origin natural gas into the EU.

Snapback (effective 29 September 2025): Council Regulation (EU) 2025/1975 reimposes all UNSC restrictions lifted under the JCPOA, including restrictions on conventional arms transfers, ballistic missile-capable technology, and nuclear-related items, with full force of EU law.

Internal Repression and Surveillance (Human Rights Regime - Regulation No 359/2011)

Prohibition on the sale, supply, transfer, or export of equipment that might be used for internal repression in Iran, including firearms, ammunition, riot control vehicles, surveillance vehicles, and associated technology.
Prohibition on the provision of technical assistance, brokering services, or financing in connection with equipment capable of being used for internal repression.
Prohibition on the sale, supply, or transfer of telecommunications and internet monitoring or interception equipment and technology capable of use in Iran for surveillance of Iranian citizens.

Military Support Regime - Drones, Missiles, and Russia (Decision (CFSP) 2023/1532)

The scope of this regime was broadened on 14 May 2024 to include both drones and missiles, and was further extended by Council Decision (CFSP) 2024/2894 of 18 November 2024 and Council Decision (CFSP) 2026/263 of 29 January 2026:

Prohibition on the export, transfer, supply, or sale from the EU to Iran of components used in the development and production of missiles and drones.
Prohibition on the provision of technical assistance, brokering services, financing, or insurance in connection with such components.
Prohibition on transactions with two Iranian ports that are owned, operated, or controlled by sanctioned individuals and entities, or that are used for the transfer of Iranian drones, missiles, or related technology and components to Russia (introduced in the May 2024 expansion).
Designation of persons and entities involved in: supplying drones and missiles to Russia for use in its war of aggression against Ukraine; supplying drones and missiles to armed groups undermining peace in the Middle East and the Red Sea region; and breaching UNSCR 2216 (2015) relating to Yemen.

Transport and Shipping

Prohibition on the provision of flagging or classification services to Iranian-owned or Iranian-operated vessels involved in illicit petroleum transfers or prohibited activities.
Member States are required to inspect vessels at their ports or anchorages where there are reasonable grounds to believe the vessel is carrying goods prohibited under the nuclear regulation.
Prohibition on the provision of bunkering or ship supply services to vessels carrying prohibited cargo.

Financial Sector Prohibitions

Prohibition on opening new correspondent accounts for the Central Bank of Iran or designated Iranian financial institutions in EU credit institutions.
Where existing correspondent accounts are maintained, enhanced monitoring and reporting obligations apply.
Prohibition on the provision of specialised financial messaging services (including SWIFT access) to designated Iranian banks.
Prohibition on the transfer of funds to Iran in connection with transactions involving prohibited goods or activities.

EU sanctions apply in the following circumstances:　

(a) within the territory of the Union, including its airspace;

(b) on board any aircraft or any vessel under the jurisdiction of a Member State;

(c) to any person inside or outside the territory of the Union who is a national of a Member State;

(d) to any legal person, entity or body, inside or outside the territory of the Union, which is incorporated or constituted under the law of a Member State;

(e) to any legal person, entity or body in respect of any business done in whole or in part within the Union.

The EU sanctions list can be checked via the official portal for European Data.

Relevant Resources

· EU Sanctions Map (searchable interactive tool)

· EU Council: Sanctions Against Iran (main page)

· EU Council: Timeline of Sanctions Against Iran

United Kingdom

The United Kingdom operates two distinct but related Iran sanctions regimes under the Sanctions and Anti-Money Laundering Act 2018 (SAMLA 2018):

Iran (Sanctions) Regulations 2023 (S.I. 2023/1314) — came fully into force on 14 December 2023. This consolidated instrument replaced the Iran (Sanctions) (Human Rights) (EU Exit) Regulations 2019 and significantly expanded the UK's autonomous framework. The purposes of the 2023 Regulations are:

to encourage the Government of Iran to comply with international human rights law and to respect human rights; and
to deter the Government of Iran or an armed group backed by the Government of Iran from conducting hostile activity against the United Kingdom or any other country.

Iran (Sanctions) (Nuclear) (EU Exit) Regulations 2019 (S.I. 2019/461) — retained from the pre-Brexit EU framework; continues to implement nuclear-related restrictive measures against Iran, including assets freezes and trade controls targeting nuclear proliferation-related goods and technology.

The 2023 Regulations were amended by The Iran (Sanctions) (Amendment) Regulations 2024 (S.I. 2024/944) (effective 13 September 2024), which extended the goods of strategic concern provisions beyond UAVs to capture a broader category of goods and technology capable of contributing to Iran's military and drone capabilities.

The Regulations were further amended by The Sanctions (EU Exit) (Miscellaneous Amendments) (No. 2) Regulations 2024 (S.I. 2024/1157) (effective 5 December 2024), which strengthened OFSI's enforcement powers, intelligence-gathering capacities, and licensing procedures.

The UK government reimposed the UN sanctions previously suspended. The Iran (Sanctions) Regulations 2023 entered into force on 14 December 2023, superseding The Iran (Human Rights) (EU Exit) Regulations 2019.

As of 28 January 2026, the UK Sanctions List is the sole authoritative source for all UK sanctions designations, including Iran designations. The OFSI Consolidated List of Asset Freeze Targets has been closed.

Prohibitions

Asset Freeze - Financial Sanctions

Under both the 2023 Regulations and the Nuclear Regulations, it is prohibited for any UK person, or any person within the UK, to:

Deal with funds or economic resources owned, held, or controlled by a designated person.
Make any funds or economic resources available, directly or indirectly, to or for the benefit of a designated person.
Circumvent, participate in activities to circumvent, or attempt to circumvent any of the financial prohibitions.

Financial sanctions apply to all UK persons wherever they are in the world. Breach of the main financial prohibitions is triable either way and carries a maximum sentence on indictment of 7 years' imprisonment or a fine (or both).

Trade Sanctions - Restricted Goods (Repression and Monitoring)

Restricted goods and restricted technology (Schedule 2): Goods or technology that may be used to repress the civilian population in Iran - including firearms, ammunition, riot control equipment, surveillance vehicles, and associated components — may not be exported, supplied, delivered, or made available to Iran without a licence.
Interception and monitoring goods and technology (Schedule 3): Goods, technology, or software capable of being used to intercept or monitor communications in Iran may not be exported or supplied without authorisation.
Interception and monitoring services: The provision of services capable of enabling or facilitating interception or monitoring of internet or telephone communications for or on behalf of the Government of Iran is prohibited.

Trade Sanctions - Goods of Strategic Concern (UAVs and Military Goods)

Goods of strategic concern (Schedule 4, as substituted): The prohibition previously limited to unmanned aerial vehicle (UAV) goods has been extended to a broader category of goods of strategic concern - covering satellite navigation equipment (GNSS), components for UAV development, and specified technology - that could contribute to Iran's military and drone capabilities.
Prohibition on the export, supply, delivery, making available, or transfer of goods of strategic concern to Iran.
Prohibition on provision of technical assistance, financial services, funds, and brokering services in connection with goods and technology of strategic concern.

Nuclear-Related Trade Sanctions (Nuclear Regulations)

Export of nuclear-related goods and technology (as specified in the schedules) to Iran or for use in Iran.
Provision of technical assistance, brokering services, financing, or insurance in connection with nuclear-related items.
Import from Iran of nuclear-related items.
Investment in Iran's nuclear industry.

Transport and Port Sanctions

Prohibition on the entry into UK ports of any ship where the Secretary of State directs that such entry is prohibited — applicable where reasonable grounds exist that the ship is or has been involved in a prohibited activity or is carrying prohibited goods.
Prohibition on UK-flagged vessels being involved in sanctionable activities.
The Secretary of State has power to direct the movement of ships and to detain vessels.

Shipping and Port Measures

The Regulations impose specific restrictions relevant to shipping. Vessels owned, controlled, chartered or operated by a designated person - now including IRISL - may be refused entry to UK ports (subject to a limited emergency exception). Designated vessels present in British ports may be detained, and their UK registration may be terminated or denied.

The Office of Trade Sanctions Implementation (OTSI) and the FCDO regularly update their Iran Sanctions guidance.

The UK list can be checked via the UK Treasury website.

Relevant Resources

· UK Sanctions List (sole authoritative source from 28 January 2026)

· UK Sanctions Relating to Iran (main collection)

· Iran Sanctions Guidance (human rights / hostile activity regime)

· Iran Nuclear Sanctions Guidance

Club cover

Club cover is available to Members undertaking legitimate, non-sanctioned trades to Iran and which do not involve SDNs. Members are reminded however that under Rule 19 of Class 1 there is unlikely to be cover available for any activity which is in breach of sanctions since that would be deemed to be imprudent or unlawful trading, or which exposes the Club to adverse action.

Members should also note that, as described above, the continuing US primary sanctions means that US insurers and reinsurers are unable to pay claims in respect of a trade involving Iran absent special permission from OFAC to do so. Members should not count on that permission being forthcoming. The International Group has repeatedly made it concerns known to OFAC about the primary US sanctions measures affecting US insurers and reinsurers and efforts continue to seek solutions.

The Club's Rule 8(4) of Class 1 stipulates that the Club is not liable to reimburse Members for any sums which are not recoverable by the Club from the IG Pool and/or reinsurers because of sanctions. All other IG Clubs have similar rules. The relevant parts of Rules 19 and 8(4) are set out on our main sanctions webpage.

Any shortfall in reinsurance recoveries will consequently be the responsibility of the Member and this should be borne in mind when deciding whether or not to trade to Iran. Further details can be found in Notice to Members No.19 2015/2016. On the IG Pool, the American Club has confirmed that they should be able to contribute their share of any Pool claim involving Iranian interests in most circumstances. For very large claims which impact upon the IG's Group Excess Loss ("GXL") programme, any reinsurance shortfalls due to sanctions which relate to certificated risks (i.e. those where the Club has issued a "blue card") may be re-pooled with the other IG Clubs, but currently any shortfalls which relate to non-certificated risks would fall back on to the Member concerned.

The Club may also be unable to pay claims or to provide security in relation to an incident in Iran. Even if the trade is legitimate with no SDN involvement and the payment is in a non-Dollar currency, many banks are refusing to undertake any transactions whatsoever which have an Iranian nexus.

These issues are set out in more detail the Club's Notice to Members No.11 2018/2019 and any Member considering trading to Iran is very strongly advised to read this Notice and to bear in mind that the Club may be severely constrained in its ability to assist if the vessel has an incident whilst in Iranian waters.

Unilateral measures

Both Bahrain and Saudi Arabia have announced restrictions on vessels trading to and from their ports and Iran. Bahraini flagged vessels are prohibited from calling in Iran and Iranian flagged vessels from calling in Bahrain. Vessels flying any other flag may not proceed to Bahrain directly after calling in Iran and will need specific clearance from the Bahraini authorities to call in Bahrain where one of her last three port calls includes an Iranian port. Further details can be found in the Club's relevant News Item.

For Saudi Arabia, Iranian-flagged vessels and vessels of any other flag carrying Iranian cargo are not permitted to call at Saudi ports, and no Iranian cargo may be transhipped in Saudi waters.

Charterparty clauses

Members considering entering into contracts involving trading to or from Iran or involving Iranian entities are advised to incorporate language into their contracts providing for termination at short notice in the event of sanctions being reintroduced or a party becoming a SDN. Suitable clauses can be found on our main sanctions webpage.

Important note

The information provided by the Club and in particular through its website is not and is not intended to be exhaustive. Every effort is made to ensure the accuracy of the information provided. However this cannot be guaranteed given that sanctions measures are subject to alteration by Governmental organisations at short notice.

Further the information on this site is not, and should not be relied upon as, independent legal advice. Members are strongly advised to undertake due diligence before fixing any business to or from a sanctioned country in order to ensure that neither the prospective cargo nor the parties to the planned venture are sanctioned. The Club is willing to assist Members where possible but they may nevertheless wish to take independent legal advice.