EU Sanctions Against Iran 2026: What Exporters and Banks Must Do

Key data

If your company exports to Iran, has Iranian counterparties, or your financial institution manages operations with that country, Decision (CFSP) 2026/774 affects you from 30 March 2026. This is not a future regulation: it is already in force and the lists have changed.

This decision amends Decision 2010/413/CFSP, the European sanctions framework against Iran that has been active since 2010. What changes now is the list of designated persons and entities — that is, those with whom it is prohibited to operate and whose assets must be frozen.

The risk is not theoretical. Operating with an entity or person included in the updated list can result in serious administrative and criminal penalties for the company and its directors.

What does this regulation establish?

Decision (CFSP) 2026/774 updates the lists of persons and entities subject to restrictive measures under the EU sanctions regime against Iran. These restrictive measures have two main effects:

• Asset freezing: any asset, fund or economic resource belonging to designated parties must be immobilised immediately.
• Prohibition of transactions: it is prohibited to carry out any commercial or financial operation with the persons and entities included in the list.

The regulation does not create a new regime: it amends and updates the one that has existed since 2010. What is relevant for companies is that the list of designated parties has changed, which requires reviewing whether any current counterparty has been added or modified.

The decision was adopted on 30 March 2026 and published in the Official Journal of the EU on 31 March 2026. Its entry into force is retroactive to the date of adoption, namely 30 March 2026.

Economic and operational impact

The direct impact depends on the degree of each company's exposure to the Iranian market. The specific operational effects are as follows:

• Immediate counterparty review: any company with commercial or financial relations with Iran must verify whether its partners, clients or suppliers appear on the updated list.
• Screening system updates: financial institutions and exporters must incorporate the newly designated parties into their compliance tools so that automatic controls function correctly.
• Risk of criminal and administrative penalties: non-compliance is not a minor infringement. The regulation establishes that the consequences may include serious administrative and criminal penalties, which includes potential personal liability for directors.
• Freezing of linked assets: if a company holds assets belonging to or intended for a designated party, it is obliged to immobilise them and notify the competent authorities.

The cost of inaction far exceeds the cost of reviewing. An operation with a designated party, even if carried out unknowingly, does not exempt from liability.

Who is affected?

• Exporting companies with commercial activity towards Iran or with Iranian clients in any sector.
• Financial institutions (banks, insurers, fund managers) that process payments, financing or guarantees linked to Iranian counterparties.
• Foreign trade operators that import or export goods originating from or destined for Iran.
• Logistics and transport companies that manage shipments to or from Iran.
• Advisors and consultants providing services to companies with exposure to Iran, as they may incur liability if they fail to alert their clients.
• CFOs and compliance officers of any company with international activity that has not explicitly ruled out links with Iran.

Practical example

A Spanish company in the industrial machinery sector has a distributor in Iran with whom it has been operating for three years. Following the publication of Decision (CFSP) 2026/774 on 31 March 2026, that distributor appears on the updated list of designated entities.

From 30 March 2026, any pending payment from that distributor must be frozen. Any shipment of goods in transit must be suspended. If the company continues to operate normally without having reviewed the list, it commits an infringement of the EU sanctions regime, with the risk of serious administrative and criminal penalties for the company and potentially for its directors.

Reviewing the updated list and updating the screening system would have prevented this situation. The cost of that review is minimal compared to the risk of non-compliance.

What should companies do now?

1. Review the updated list of designated parties published in Decision (CFSP) 2026/774 in the Official Journal of the EU to identify whether any current counterparty appears on it.
2. Update screening systems with the newly designated names and entities, ensuring that automatic compliance controls reflect the list in force from 30 March 2026.
3. Suspend pending operations with any counterparty appearing on the updated list, including payments, shipments and service provisions.
4. Freeze linked assets belonging to designated persons or entities and notify the competent authorities in accordance with Spanish legislation implementing international sanctions.
5. Document the review process to demonstrate due diligence in the event of an inspection or subsequent investigation.
6. Inform sales, procurement and finance teams about the changes to the list to prevent new operations from being initiated with designated parties due to lack of awareness.
7. Seek advice from specialist legal counsel if there is any doubt about the status of a counterparty or about the specific obligations arising from asset freezing.

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:32026D0774