On June 23, 2026, the US Department of the Treasury’s Office of Foreign Assets Control (“OFAC“) and HM Treasury’s Office of Financial Sanctions Implementation (“OFSI“) published a joint statement reflecting on their latest Enhanced Partnership exchange and issued a new joint guidance document that provides a comparative overview of the US and UK sanctions regimes. The joint statement and guidance follow a January 2026 in-person meeting between OFSI and OFAC. The statement and accompanying guidance will be of interest to companies and financial institutions navigating compliance obligations across both jurisdictions and provide a further illustration of the close links and coordination between the agencies.
The Enhanced Partnership Exchange
Since launching the Enhanced Partnership in 2022, OFAC and OFSI have used in-person exchanges, the development of guidance, engagement with industry, and the development of information sharing mechanisms to increase the effectiveness of the United States’ and the United Kingdom’s sanctions regimes.
OFAC and OFSI met for their latest weeklong in-person exchange in London in January 2026. The exchange focused on how the agencies use their respective powers to meet foreign policy and national security demands, such as tightening or lifting sanctions, adopting new technology, and highlighting enforcement efforts.
Coming out of the in-person exchange, OFAC and OFSI identified the following opportunities to continue to work together to improve the efficacy of their respective sanctions regimes:
- evaluating parallel mechanisms to enable them to rapidly increase sanctions pressure;
- harnessing lessons learned from the novel restrictions developed as part of their coordinated response to Russia’s invasion of Ukraine to apply to other scenarios;
- identifying typologies and economic impact of sanctions targets to more effectively disrupt concerning behavior, such as in relation to the shadow fleet;
- reviewing and enhancing processes necessary to dismantle sanctions regimes in a structured way, such as in Syria; and
- translating the lessons learned and insights from their global sanctions regimes, such as counternarcotics or illegal migration, to produce new tools and resources that can be applied across shared sanctions regimes.
OFAC and OFSI’s joint statement also signaled a continued emphasis on technology and modernization in implementing and enforcing sanctions. According to OFAC and OFSI, the agencies explored the methodologies and technological tools available to assess the disruptive effect of sanctions during the exchange. The agencies indicated that they continue to modernize systems for applying for licenses, disclosing violations, submitting reports, or seeking guidance. Notably, the agencies stated they would share their experiences using artificial intelligence to support their functions going forward. In addition, the agencies noted that the Enhanced Partnership has now entered its fifth year, and that the most recent exchange builds on existing foundations of regular engagement, information-sharing facilitated through the OFAC-OFSI Memorandum of Understanding (discussed in our blog post here), and joint industry engagements.
New Joint Guidance
The guidance document compares key aspects of US and UK sanctions regimes, identifying similarities and differences on topics such as sanctions lists, licenses, as well as recordkeeping and reporting requirements.
The guidance provides a useful side-by-side comparison of the two systems and highlights several areas where their approaches diverge. Among other topics, the guidance notes differences in the structure of sanctions programs, the treatment of sanctioned entities owned by designated persons, licensing frameworks, recordkeeping rules, and enforcement practices.
For example, while both OFAC and OFSI recognize that sanctions restrictions can extend to entities that are not themselves listed but are owned by sanctioned persons, the agencies apply different ownership methodologies. OFAC aggregates ownership interests held by multiple blocked persons under its 50 Percent Rule, whereas OFSI’s ownership analysis differs and is supplemented by a separate control test that may capture entities even where ownership thresholds are not met.
The guidance also highlights differences in the territorial reach of the two regimes. US sanctions can have significant extraterritorial effects, including through secondary sanctions and certain activities involving non-US persons that cause, facilitate, or evade sanctions violations. By contrast, UK sanctions generally rely on territorial and nationality-based jurisdiction, although it should be noted that UK authorities have taken a broad approach to jurisdictional concepts in recent enforcement cases.
The guidance also notes that OFSI general licenses may carry notification or reporting requirements, while OFAC general licenses typically operate without similar procedural conditions. In addition, the agencies maintain different recordkeeping and reporting frameworks, including different annual reporting deadlines for blocked or frozen assets.
Finally, the guidance compares the agencies’ enforcement approaches. Both OFAC and OFSI consider voluntary disclosures when assessing penalties, but the agencies apply different mitigation frameworks and penalty calculations. The guidance also notes that OFSI’s civil enforcement regime now operates on a strict liability basis, a development that has brought certain aspects of UK enforcement closer to the US model.
Taken together, these comparisons underscore that even as OFAC and OFSI seek alignment between US and UK sanctions policy objectives, important legal and operational differences remain. As a result, companies subject to both regimes should ensure that their compliance programs address the specific requirements of each jurisdiction rather than assuming that compliance under one framework will satisfy the other.
