Sanctions Watch | Weekly Vol. 166

Sanctions Watch Vol 166

In the latest edition of our Sanctions Watch weekly digest, we present significant updates on sanction watchlists and regulatory developments.

OFSI Extends General Licence Allowing Continued Business with Lukoil Bulgaria Entities Until October 2026

The UK Office of Financial Sanctions Implementation (OFSI) has amended General Licence INT/2025/7895596, which permits the continuation of certain business activities involving specified Bulgarian subsidiaries of PJSC Lukoil under the Russia (Sanctions) (EU Exit) Regulations 2019.

The licence covers Lukoil Bulgaria EOOD, Lukoil Neftochim Burgas AD, Lukoil Aviation Bulgaria EOOD and Lukoil Bunker Bulgaria EOOD, as well as their directly or indirectly owned or controlled subsidiaries. It allows persons to continue business operations with these entities, including making and receiving payments under existing or new contracts and providing or receiving economic resources. Relevant UK financial institutions may also process payments permitted under the licence.

Following the amendment dated 12 August 2026, entities using the licence are subject to a notification requirement. Those commencing permitted activities on or after that date must notify HM Treasury within 14 days of commencing the activity, while entities already undertaking such activities must provide notification within 14 days of 12 August 2026. They must also provide current contact details and report subsequent changes.

The General Licence, originally effective from 14 November 2025, has been extended to 29 October 2026. It applies only to activities otherwise prohibited under the Russia Regulations and does not authorise conduct that would breach other UK sanctions regimes.

UN Monitoring Team Warns Terrorist Threat Intensifying in Sahel and South Asia, Calls for Stronger Sanctions Tools

The United Nations Analytical Support and Sanctions Monitoring Team has released its thirty-eighth report on ISIL (Da’esh), Al-Qaida and associated individuals and entities, finding that the overall terrorist threat remained broadly unchanged but intensified in the Sahel and South Asia. The report, issued as UN Security Council document S/2026/651, covers developments through 9 June 2026.

The report highlights growing activity by several regional affiliates. JNIM remained the leading terrorist threat in the Sahel and expanded its operations in Mali, while ISGS increased its operational capabilities. In South Asia, cross-border attacks between Pakistan and Afghanistan continued, with TTP escalating attacks against Pakistan, while ISIL-K remained the most significant terrorist threat to Afghanistan’s de facto authorities and the wider region.

Terrorist financing also remains a key concern, with Al-Qaida and ISIL affiliates relying on illicit taxation, extortion, legitimate businesses and kidnapping for ransom. The Monitoring Team additionally reported increasing information from Member States concerning cryptocurrency addresses linked to sanctioned individuals and entities, while noting that the current UN sanctions list does not accommodate digital currency addresses.

During the reporting period, three individuals were added and seven removed from the UN ISIL (Da’esh) and Al-Qaida sanctions list, while the entry for Al-Nusrah Front, also known as HTS, was removed on 27 February 2026. As of its latest update on 21 May 2026, the list contained 249 individuals and 88 entities. The Monitoring Team stressed that the sanctions regime must continue to evolve with the changing threat and encouraged Member States to propose further designations.

The Team also recommended stronger measures to address terrorist financing through concealed beneficial ownership and proposed exploring a dedicated digital currency address field within the UN sanctions list in response to terrorist groups’ increasing use of cryptocurrency.

Nine European Countries Align with EU Sanctions Measures Targeting Six Individuals over Iran

The European Union has announced that nine European partner countries have aligned themselves with its latest restrictive measures concerning certain persons and entities in view of the situation in Iran.

On 24 July 2026, the Council adopted Decision (CFSP) 2026/1850 implementing Decision 2011/235/CFSP and added six individuals to the list of persons and entities subject to EU restrictive measures related to Iran.

Albania, Bosnia and Herzegovina, Iceland, Liechtenstein, Moldova, Montenegro, North Macedonia, Norway and Ukraine have aligned themselves with the Council Decision and committed to ensuring that their national policies conform to the measures.

In its statement dated 14 August 2026, the EU welcomed the countries’ commitment, extending broader European alignment with the bloc’s Iran-related sanctions framework.

Australian Sanctions Office 2025 Annual Report Reveals Major Expansion of Australia’s Sanctions Regime

The Australian Sanctions Office (ASO) has published its 2025 Annual Report, highlighting a significant expansion of Australia’s sanctions regime in response to Russia’s invasion of Ukraine, Iran’s nuclear activities, cyber threats, terrorism financing, human rights violations and developments in Afghanistan. Australia imposed 428 new autonomous sanctions during 2025, bringing the total number of autonomous sanctions to 2,512 and the combined total under autonomous and UN Security Council frameworks to 3,511 by year-end.

Russia remained a major focus, with Australia imposing 417 additional Russia-related sanctions during the year. The Government also sanctioned 200 shadow fleet vessels across three packages for the first time and, alongside international partners, lowered the Russian Oil Price Cap to US$47.60.

Australia also established a new autonomous sanctions framework for Afghanistan, imposing its first designations against four senior Taliban figures and introducing an arms embargo. Separately, following the UN Security Council’s Iran sanctions “snapback”, Australia implemented asset freezes and travel bans covering 43 persons and 78 entities, together with restrictions involving nuclear goods, ballistic missiles, arms matériel and certain services and activities.

Enforcement and compliance activity also increased. The ASO finalised 32 compliance matters, conducted 44 outreach activities and published 26 guidance and advisory notes during 2025. It received 70 sanctions permit applications, granting 18, while 16 remained under review at year-end. The regulator also revised Australia’s Consolidated List and introduced a redesigned sanctions permit application process to support compliance by regulated entities.

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Sanctions Watch is a weekly recap of events and news related to sanctions around the world.