Sanctions and Export Controls Update

Monthly Roundup – January 2026

📅 February 3, 2026

Welcome to this month’s Sanctions and Export Controls Update, highlighting IFI’s take on key developments from January 2026.

Welcome to this month’s Sanctions and Export Controls Update, highlighting IFI’s take on key developments from January 2026. There were several major sanctions-related developments in January, most notably the U.S. easing of sanctions to facilitate Venezuelan oil sales, the ratcheting up of western sanctions in response to Tehran’s violent crackdown on protestors, and the seizures of an oil tanker by France and a cargo ship by Italy to enforce EU sanctions on Russia.

Venezuela

In the wake of the U.S. apprehension of Nicolás Maduro in early January, the U.S. sanctions posture toward Caracas dramatically shifted from a full oil blockade to oil sales facilitation, punctuated by OFAC General License No. 46 issued at the end of the month. The license authorized established U.S. companies to engage in transactions involving Venezuelan-origin oil, including the lifting, sale, re-sale, exportation, re-exportation, refining, transport, supply, storage, marketing, purchase, delivery, and transportation of such oil.

The move followed the passage of Venezuelan legislation opening the oil industry to private investment, a reform welcomed by Washington as a step toward economic recovery. The license does not authorize transactions involving Russian, Iranian, North Korean, or Chinese entities.
Switzerland also moved to freeze assets held by Nicolás Maduro and individuals associated with him, to prevent capital flight amid Venezuela’s volatile political situation. If future legal proceedings prove the assets were illicitly acquired, Switzerland will seek to return them for the benefit of the Venezuelan people, according to the Swiss Federal Council.

Iran

In response to the Iranian regime’s violent crackdown on peaceful protestors and its complete shutdown of internet access, the U.S., EU, and UK ratcheted up sanctions against Iranian officials, institutions, shadow fleet vessels, and sanctions evasion networks, including the first designation of an IRGC-linked digital asset exchange.

The U.S. rolled out three tranches of designations targeting Iranian regime officials for violent repression and corruption, two UK-registered digital asset exchanges involved in large scale sanctions evasion, 18 individuals and entities connected to “shadow banking” networks operated by Bank Melli and Shahr Bank that laundered billions of dollars from Iranian energy sales to support repression and foreign militant activity, and nine shadow fleet vessels and eight shipping firms accused of moving hundreds of millions of dollars in Iranian oil exports.
The EU and UK also announced expanded sanctions linked to the violent repression of peaceful protests—including the EU designation of Iran’s Islamic Revolutionary Guard Corps (IRGC) as a terrorist organization. The G7 Foreign Ministers also issued a statement saying they are prepared to impose additional restrictive measures if Iran continues to crack down on protests and dissent in violation of international human rights obligations.

Russia

Several major actions were taken in January to enforce EU sanctions against Russia, including the seizure of an oil tanker by France and a cargo ship by Italy, and a multi-state criminal investigation to disrupt an evasion scheme to move transport vehicles to Russia. In addition, the EU adopted a regulation on phasing out imports of Russian pipeline gas and liquified natural gas (LNG) into the EU, lowered the oil price cap on seaborne Russian crude oil, and added Russia to its “AML blacklist” of high-risk countries.

The French navy seized sanctioned oil tanker “The Grinch” in the Mediterranean on suspicion of being part of Russia’s sanctions-evading shadow fleet, and Italian authorities seized bulk carrier “Hizir Reis” at the port of Brindisi on suspicion of breaching EU sanctions against Russia. Meanwhile, the European Anti-Fraud Office (OLAF) uncovered a broad scheme to circumvent EU sanctions against Russia involving more than 760 transport vehicles exported from multiple EU member states.
To end the EU’s reliance on Russian energy, the EU formally adopted a regulation to phase out direct and indirect imports of Russian pipeline gas and LNG. The new rules include measures on effective monitoring and diversification of energy supply. The EU (along with the UK) also lowered the oil price cap on seaborne Russian crude oil from $47.60 to $44.10 per barrel, and added Russia to its list of high-risk countries that have strategic deficiencies in their AML/CFT regimes.

Other Significant Developments

Other highlights from January included new U.S. sanctions targeting Hamas front organizations, Muslim Brotherhood branches, Houthi support networks, and a narcotics trafficking hub in Costa Rica. In addition, the Multilateral Sanctions Monitoring Team briefed their second report on North Korea’s violation and evasion of sanctions, and the UK moved to a single list for sanctions designations. Finally, the U.S. eased certain export control rules related to semiconductors and drones and brought several enforcement actions related to export control violations involving Russia and China.

Terrorism

Muslim Brotherhood Branches Designated as Terrorist Organizations

The U.S. and Argentina sanctioned the Egyptian, Jordanian, and Lebanon branches of the Muslim Brotherhood under counter-terrorism authorities, citing their support for Hamas. OFAC also designated multiple organizations and an individual for covertly supporting Hamas through fraudulent charities and front groups. Meanwhile, the EU extended its restrictive measures against Hamas and the Palestinian Islamic Jihad (PIJ) for another year.

Treasury Increases Pressure on Houthi Smuggling and Illicit Revenue Generation Networks

OFAC sanctioned an additional 21 individuals and entities and one vessel for supporting the Houthis through illicit oil sales, weapons procurement, logistics, aviation, and financial facilitation. The sanctions targets, based in the UAE, Yemen, and Oman, consist of oil companies, exchange houses, aviation companies, shipping and logistics firms, and vessel captains that moved fuel, arms, dual-use equipment, or funds for the Houthis.

North Korea

Multilateral Team Highlights North Korea’s Campaign to Evade Sanctions

The Multilateral Sanctions Monitoring Team (MSMT)—a mechanism established in 2024 after Russia vetoed the renewal of the UN 1718 Committee Panel of Experts—shared the key findings of their second report with an audience at the UN Headquarters in New York. Drawing on 140 pages of previously non-public information from 11 UN member states and nine private companies, the report details how North Korea violates sanctions through cyber operations and overseas IT workers, including support networks in China, Russia, Southeast Asia, and the Middle East.

Organized Crime

Prince Holding Founder Arrested in Cambodia, Extradited to China

Cambodian authorities arrested and extradited to China Chen Zhi, the Chinese-born founder of Prince Holding Group. The U.S. sanctioned Chen and Prince Holding in 2025, alleging that they helped run a multibillion-dollar cyber-scam and money-laundering network that included forced-labor scam compounds where trafficked workers carried out cryptocurrency “pig butchering” schemes that defrauded victims worldwide of billions of dollars.

U.S. Treasury Sanctions Major Costa Rica Cocaine Pipeline

OFAC sanctioned five Costa Rican nationals and five Costa Rica-based entities tied to a major cocaine trafficking and money-laundering network that moved multi-ton shipments from Colombia to the U.S. and Europe. The action followed a U.S. Homeland Security Task Force-led investigation involving DEA and Costa Rican authorities.

Export Controls

U.S. Eases Licensing Rules for Select Semiconductor Exports to China

BIS revised its licensing policy for exporting advanced semiconductors to China. Under the new rule, export license applications for Nvidia’s H200, AMD’s MI325X, and similar chips will be reviewed on a case-by-case basis. The change follows President Donald Trump’s December announcement allowing shipments to approved Chinese customers.

U.S. Eases Licensing Rules for Commercial Drone Exports

BIS issued an interim final rule easing export controls on certain civilian drones and related technologies. The rule allows U.S. exports of less sensitive commercial UAVs with under one hour of endurance and widely available abroad to be exported license-free to most Wassenaar Arrangement Participating States. It also permits exports of more capable non-military drones to select U.S. allies under a license exception.

TSMC Secures U.S. License for Chip Equipment Shipments to China

The U.S. issued Taiwan Semiconductor Manufacturing (TSMC) an annual export license allowing American chipmaking equipment to be supplied to its Nanjing, China, facility. The approval ensures uninterrupted operations and product deliveries. TSMC joins South Korea’s Samsung Electronics and SK Hynix in receiving similar exemptions.

China Sharpens Checks on Rare Earth Exports to Japan

China tightened screening of rare earth and rare metal exports to Japan since early January, requiring extra paperwork and detailed supply chain disclosures, industry sources said. The move follows China’s January 6 expansion of controls on dual-use exports to Japan and comes amid diplomatic tensions over Taiwan.

U.S. House Committee Advances Bill to Tighten AI Chip Export Controls

The U.S. House Foreign Affairs Committee has passed the Artificial Intelligence Oversight of Verified Exports and Restrictions on Weaponizable Advanced Technology to Covered High-Risk Actors (AI OVERWATCH) Act out of committee. The bill, co-sponsored by the House Select Committee on the Chinese Communist Party (CCP), would require licenses for exporting, reexporting, or transferring high-performance AI chips to countries of concern, increasing transparency and accountability in the licensing process.

Commerce Fines German Firm Over Export Control Violations

German firm Exyte Management agreed to pay a $1.5 million penalty to settle enforcement action brought by BIS for violations of U.S. Export Administration Regulations. The case stemmed from findings that Exyte’s Chinese subsidiary facilitated 13 unauthorized in-country transfers of used semiconductor manufacturing items to SMIC Beijing, which is on the BIS Entity List.

U.S.-Russian Citizen Sentenced for Scheme to Smuggle Aircraft to Russia

A federal court sentenced Sergey Nechaev, a dual U.S.-Russian citizen, to 41 months in prison for attempting to illegally export aircraft to Russia in violation of U.S. export controls. Between September 2022 and March 2023, he sought to export two Cessna aircraft worth about $170,000 to Russia by routing them through Türkiye and Armenia after stricter Russia sanctions took effect.

Kyrgyz National Jailed for Illicit U.S. Gun Exports to Russia

A federal judge sentenced Kyrgyz national Sergei Zharnovnikov to 39 months in prison for conspiring to illegally export American-made firearms and ammunition to Russia. Court records showed that he repeatedly lied to U.S. companies and authorities, reexporting semi-automatic rifles and ammunition despite licenses explicitly barring transfers to Russia. Some of the weapons were later linked to Russian forces fighting in Ukraine.

Indian National Gets Jail Term for Illegal Aviation Exports to Russia

A federal court sentenced Indian national Sanjay Kaushik to federal prison for conspiring to illegally export controlled U.S. aviation components from Oregon to Russian end users. Kaushik and his co-conspirators were found to have falsely claimed aerospace parts were destined for his Indian company, when they were intended for Russia.

U.S. DOJ Seeks Forfeiture of Anti-Sub Trainers Bound for China’s Military

The DOJ filed forfeiture proceedings against two mission crew trainers seized while en route from the Test Flying Academy of South Africa (TFASA) to the China’s People’s Liberation Army. The mobile classrooms were designed to train Chinese forces in airborne warning, control, and anti-submarine warfare, using U.S.-origin software and defense technical data.

Other

EU Renews Targeted Sanctions Over Democratic Concerns in Guatemala

The European Council renewed until January 13, 2027, the restrictive EU measures against eight individuals and one entity that it identified as undermining democracy, the rule of law, and the peaceful transfer of power in Guatemala.

EU Sanctions Seven Individuals Over Escalating Violence in Sudan

The EU Council imposed sanctions on seven individuals over the escalating violence in Sudan, citing widespread human rights and humanitarian law violations, particularly in Darfur. The listings include five individuals affiliated with the Rapid Support Forces and two linked to the Sudanese Armed Forces, including senior commanders and militia leaders accused of threatening the country’s peace and stability.

Switzerland Expands Haiti Sanctions to Align with EU Restrictions

Switzerland’s Federal Council has expanded its sanctions targeting the perpetrators of gang violence in Haiti, aligning them with EU restrictions. Berne’s new measures target 10 individuals and entities in response to escalating gang violence and Haiti’s worsening humanitarian crisis.

UK Moves to a Single List for Sanctions Designations

The UK officially closed the OFSI Consolidated List of Asset Freeze Targets and moved to a single list—the UK Sanctions List—publishing updated guidance about the list to assist businesses implement the change.

OFSI Concludes Consultation on Sanctions Enforcement Processes

The UK’s OFSI published a response to a public consultation on proposed measures to enhance the effectiveness of its civil enforcement processes for financial sanctions and the Russian Oil Orice Cap. The document summarizes feedback received and explains how the revised enforcement framework will operate, including changes to enable more efficient investigation and resolution of potential violations. All but one of the proposed changes will take effect when OFSI publishes its updated Enforcement and Monetary Penalties guidance next month.

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