Drifting apart: Adapting to a growing divide between EU, UK, and US sanctions

Abstract

Over the course of 2025, there has been an increasing divide between the objectives of sanction regimes imposed by the EU, the US, and the UK. All three are usually relevant for companies operating in international markets due to their relevance in global trade, the role of their respective currencies and their historical role in setting the narrative on matters of sanctions policies. The initially unified approach towards Russia has shifted, with the US willing to negotiate a peace deal (and even make major concessions to Putin’s wishes regarding Ukraine), while the EU and UK remain firm in their condemnation of the invasion. If a peace deal is achieved, it could have important implications for the current sanctions measures and drive the divergence even further. However, even within the EU, there are signs of discontent and a thinning alignment. More countries have, for instance, chosen to implement the legal basis for autonomous sanctions, an evolution that could potentially put the common regimes of the EU into question. Finally, the US is a firm supporter of Israel and its war against Hamas, which has resulted in controversial sanctions imposed against the International Criminal Court (ICC). Neither the EU nor the UK supports this approach and has spoken openly against it. But despite the increasing divergence on multiple matters, instances of convergence have also taken place in recent times. All major jurisdictions have suspended and lifted most sanctions against Syria in the wake of the fall of al-Assad’s regime and the historically divided stance on Iran has recently reached a more unified front with the snapback of United Nations sanctions and the subsequent reintroduction of previously suspended measures. It is also interesting to note how the EU, notoriously critical of the USA’s extraterritorial reach, appears to have recognised the potential of secondary sanctions and is beginning to implement them (albeit under the name ancillary sanctions). In an increasingly complex regulatory landscape, it is paramount for companies to take active steps to ensure compliance and the ability to quickly adapt to change. This article is also included in The Business & Management Collection which can be accessed at https://hstalks.com/business/.