UK Trends and Developments Contributed by: John Binns, BCL Solicitors LLP
Scaling back of sanctions inevitably tests how non- state actors (particularly businesses in sanctioning countries) respond to situations of continued volatility and risk, notwithstanding the relative speed of govern - ments’ policy changes and amendments to legal pro - visions. The prime historic example is Iran, for which sanctions relief (in return for monitored progress on nuclear non-proliferation) was limited in practice due to scepticism (well-founded, as matters transpired) about its durability from industry in general and the financial sector in particular. The tentative nature of sanctions relief is sometimes expressed in the form of general licences (with or without explicit time limits, but often expressly on the basis that they can be revoked at any time) rather than delistings or revocations. The United States’ approach to Venezuela, after forcibly removing its president and reaching an apparently far-reaching accommodation with his replacement, notably adopted this form of relief. The UK (presumably having too little involve - ment in Venezuelan business either to incentivise a resurgence or to exercise influence on US actions) appears to have been slow to follow its lead. The challenge of Iran At the time of publication of this guide, the UK’s approach to one sanctions-related dilemma appears to be at something of a “pinch point”. Historically, the UK has sided with European partners rather than the US on the question of how to deal with Iran’s nuclear ambitions, while the two countries’ stance on the regime’s human rights record (also expressed via sanctions) has been relatively strong (if tempered in the UK’s case, by a long-standing reluctance to pro - scribe the Iranian Revolutionary Guard Corps (IRGC) as a terrorist organisation). The United States’ decision to join Israel in carrying out air strikes against Iran from 28 February 2026 prompted a new schism between it and the UK (among other allies), and a significant dilemma with respect to sanctions. In undertaking to lift all restrictive measures (including those at UN level) in its Memorandum of Understanding (MoU) with Iran, the US administration seems ready to set aside a decades-long internation - al strategy of economic pressure, aimed at tackling
Iran’s lamentable human rights record as well as its non-compliance with the NPT. The MoU undertaking arguably fits into a pattern of US actions that clearly favour a more varied, immedi - ate and changeable range of methods against vari - ous countries (ranging from tariffs and threats towards traditional allies, via comprehensive sanctions against Cuba, to direct military action and, in the case of Iran, a naval blockade), while using sanctions against unconventional targets (including the ICC). In dealing only temporarily with the reopening of the Strait of Hormuz, it suggests agnosticism towards the principle of freedom of navigation, with hints from the presi - dent that the issue may be dealt with pragmatically by some sort of shared toll regime. Finally, it seems to downgrade the importance of human rights in so far as it leaves little or no leverage (and none via sanc - tions) to achieving change in that sphere. Will the UK follow suit and relax its own sanctions against Iran? To do so would imply an agreement with the aims and methods of the US administration in this conflict, arguably not in keeping with its recent actions. Not to do so could do further damage to a fundamentally important principle of sanctions, that they work far better when sanctioning allies are in lockstep with each other than when they break ranks and attempt to assert unilateral positions. “The right thing”? The context of all these creative uses of and changes in sanctions regimes, in the UK as elsewhere, is the government’s appeal to moral values (and to its related agendas in AML compliance and economic crime) to justify the imposition of restrictive measures on those targeted, and indeed the removal of those restrictions when circumstances change. Sustaining this can be particularly challenging when politics come into play. Reasonable arguments can emerge both domestical - ly and internationally – not only between those who target others and those who are being targeted, but also among governments that have historically aligned with one another. Looking to the future, while at the time of publica - tion of this guide, the prospect of positive changes in international trouble spots seems remote, perhaps the
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