EU Sanctions against Iran 2026: what companies and banks must verify

Key data

If your company operates with Iranian counterparties or your financial institution processes payments related to Iran, this update requires you to act immediately. Council Decision (CFSP) 2026/779, published on 31 March 2026, amends Decision 2011/235/CFSP, the EU's base sanctions framework against Iranian persons and entities responsible for serious human rights violations.

The amendments may include additions, deletions or updates to the list of sanctioned subjects. The practical result is always the same: if your counterparty appears on the list, you cannot operate with them. And if you were already doing so, you must cease immediately.

What does this regulation establish?

Decision 2026/779 updates the list of persons and entities subject to restrictive measures under the framework of Decision 2011/235/CFSP. This sanctions regime has been in place since 2011 and is periodically reviewed to reflect changes in the human rights situation in Iran.

The two restrictive measures that apply to all listed subjects are:

• Asset freezing: no European company or entity may carry out financial transactions with the subjects included on the list, nor make funds or economic resources available to them.
• Prohibition of entry into the EU: listed natural persons may not enter or transit through the territory of the European Union.

The amendments that this decision may introduce with respect to the previous list include:

• Addition of new persons or entities to the sanctioned list.
• Removal of persons or entities that are no longer subject to restrictive measures.
• Update of identifying data of already listed subjects.

To find out exactly which persons and entities have been added, removed or modified in this specific update, it is necessary to consult the full text of the decision on EUR-Lex (CELEX:32026D0779).

Economic and operational impact

The impact is not theoretical. Operating with a sanctioned entity or person exposes the company to direct consequences on three levels:

Financial institutions have a particularly high exposure: they must apply controls in their counterparty screening systems to detect any match with the updated list. A payment processed to a sanctioned subject may constitute a breach even if unintentional, if the required controls have not been adopted.

For exporting companies, the risk is concentrated in supply contracts, letters of credit or commercial agreements with Iranian companies that may have been added to the list in this update.

Who is affected?

• Financial institutions: banks, savings banks, payment institutions and any financial intermediary that processes transactions with Iranian counterparties. These are the most directly affected according to the regulation itself.
• Exporting companies: especially those operating in sectors with a presence in Iran (energy, industry, technology, consumer goods).
• Importing companies: that receive goods or services of Iranian origin through intermediaries.
• Advisors and consultancies: those providing services to clients with Iranian ties must verify that their clients do not appear on the list.
• CFOs and financial directors: responsible for validating that international payments are not directed to sanctioned subjects.
• Compliance departments: required to update their screening lists with the new version of Decision 2011/235/CFSP.

Practical example

A Spanish industrial company maintains a component supply contract with an Iranian company with which it has been working for three years without incident. On 30 March 2026, Decision 2026/779 enters into force, adding that Iranian company to the list of sanctioned entities.

From that moment on, the Spanish company cannot execute any pending payment, receive goods under that contract or renew it. If its bank processes a payment to that entity after 30 March, both the company and potentially the bank are in breach of sanctions, with the risk of serious criminal and administrative sanctions.

The only way to have avoided this situation is to have a counterparty screening system that is updated with each new publication in the Official Journal of the EU and that automatically alerts when an existing counterparty appears on a sanctioned list.

What should companies do now?

1. Consult the full text of Decision 2026/779 on EUR-Lex to identify exactly which persons and entities have been added, removed or modified compared to the previous version of the list.
2. Cross-reference the updated list with the company's counterparty register: customers, suppliers, intermediaries and any entity with which commercial or financial relations with Iranian ties are maintained.
3. Immediately suspend any pending transactions with counterparties appearing on the updated list, including payments, shipments of goods and provision of services.
4. Notify the legal and compliance department to assess whether there is exposure and what corrective actions are necessary, including possible notification obligations to the authorities.
5. Update counterparty screening systems with the new version of the list, both in the finance department and in the international purchasing and sales departments.
6. Review ongoing contracts with Iranian counterparties or with intermediaries operating in Iran to identify sanctions compliance clauses and activate them if applicable.

Official source

Disclaimer: This article is for informational purposes only and does not constitute legal advice. For specific decisions, please consult a qualified professional. Source: https://eur-lex.europa.eu/./legal-content/AUTO/?uri=CELEX:32026D0779