Any person or organisation involved in a transaction with those subject to financial sanctions will first need a licence from OFSI.
Where a transaction involves a person or organisation who is subject to financial sanctions (whether directly or indirectly), you must obtain a licence to allow the activity to take place without breaching financial sanctions. You should not assume that a licence will be granted or engage in any activities prohibited by financial sanctions unless you have a valid licence.
OFSI can only issue licences on specific legal grounds which are set out below.
When should you apply for a licence?
OFSI recommends applying for a licence as early as possible and at least four weeks before a licence is needed. Licence applications can be legally and commercially complex. In certain circumstances, the UN will need to approve them or be made aware of them. This can lead to a longer turnaround time. You may wish to consider taking independent legal advice before applying for a licence.
Applying for a licence
You need to provide as full an explanation as possible, and evidence, of the proposed transaction for which you need a licence.
Incomplete applications will be returned and will lead to delays in you obtaining a licence.
Therefore, it’s in your interests to complete the application in line with OFSI’s requirements.
OFSI requires information and evidence including:
the amount of an intended payment
the intended purpose of the transaction/funds
the intended payment route(s)
the sender and receiver of funds, including any intermediaries and beneficiaries
how the funds will be accounted for
explanation of the reasonableness of any proposed payment (where relevant)
Completed applications should be submitted to email@example.com
What types of licences are available?
OFSI can only issue a licence where there are legal grounds to do so. You need to assess which ground is relevant to your application, referencing the relevant regulations. The grounds listed are for regimes operating under the Sanctions and Anti Money Laundering Act (the Sanctions Act).
Licences can generally be obtained where the proposed transactions are for:
covering expenses such as food, rent and medicines (referred to as basic needs)
reasonable professional legal fees or reasonable expenses associated with the provision of legal services
prior obligations (if the obligation/contract started before the sanction was imposed)
covering the payment of fees/service charges for routine holding or maintenance of frozen funds or economic resources
pre-existing judicial decisions
extraordinary expenses, where considered appropriate
extraordinary situations, where considered appropriate (only for non-UN listed persons)
You should check whether a derogation applies to a specific regime. Other derogations may also apply, so check the regulations.
Under the Sanctions Act, OFSI may issue general licences which allow multiple parties to undertake specified activities which would otherwise be prohibited by sanctions legislation, without the need for a specific licence. Each general licence will include requirements for prior notification of use, record-keeping and reporting. OFSI does not accept applications for general licences. More information is available in OFSI’s UK financial sanctions general guidance.
A list of general licences published by OFSI can be found on the General License page.
What is prohibited?
Prohibited transactions are outlined in the relevant regulation for the financial sanction. Visit the relevant country or terrorist group page for information and a link to the relevant regulations. Prohibited transactions are outlined in the relevant regulation for the financial sanction. Visit the relevant country or terrorist group page for information and a link to the relevant regulations.
OFSI will seek to engage with applicants on the content of completed applications within four weeks. You should not assume that the licence will be granted or engage in any activities prohibited by financial sanctions unless you have a signed licence.
OFSI prioritises humanitarian applications and will process urgent applications where there are life-threatening circumstances. Please take this into consideration when you are applying for a licence. Unless an application is genuinely urgent, it will not be treated as such.
Do I need a separate licence to export goods to those subject to financial sanctions?
Yes. Export control licences permit prohibited activity under trade sanctions and embargoes. Even where an export control licence has been granted, you may still require an OFSI licence and it is not guaranteed that an OFSI licence will be granted.
An OFSI licence is required if:
- the goods are going to a person or organisation subject to financial sanctions
- the funds are transferring through a person or organisation subject to sanctions
These licences are explained further in our guidance.
Licence process in relation to terrorist groups
For licence applications relating to designations made under Counter-Terrorism regimes, please consult our counter-terrorism licensing policy page and the Counter-Terrorism licence section of OFSI’s General Guidance