International Sanctions Lawyer in Paris

A company learns that one of its customers is on a sanctions list, that a bank refuses a transfer because of a link with a targeted country, or that it or one of its executives is designated by a freezing measure. International sanctions form a body of law of their own, European, national and sometimes American, whose effects are immediate: asset freeze, prohibition on making funds available, criminal penalties for breach.

This page presents the situations the firm handles, apart from shipping which has a dedicated page, and how it intervenes, in compliance and in litigation, for French and foreign companies.

The risk: breaching a sanction unknowingly, or suffering one without recourse

EU regulations (notably Regulations 269/2014 and 833/2014 for Russia) apply directly to every EU company. The 50% rule extends the freeze to entities owned or controlled by a designated person, without their appearing on any list. Since Directive (EU) 2024/1226, breach of sanctions is a harmonised criminal offence across the Union.

Conversely, a European company that voluntarily complies with certain extraterritorial US sanctions breaches Blocking Regulation No 2271/96, as the Court of Justice held in Bank Melli Iran v Telekom Deutschland. A badly drafted sanctions clause may thus itself be unlawful.

The legal answer: compliance upstream, structured remedies downstream

Upstream, the firm sets up counterparty screening, asymmetric sanctions clauses, the mandatory “No Russia” clause of Article 12g of Regulation 833/2014 and the licence and release-for-basic-needs procedures with the French Treasury Directorate.

Downstream, a designation is challenged by an action for annulment before the General Court of the EU (Article 263 TFEU, two months and ten days), a delisting request to the Council and, for national measures, an action before the administrative court. Civil disputes arising from sanctions (termination, force majeure, Article 11 of Regulation 833/2014) are handled before the contract court or the arbitrator.

US sanctions, OFAC and secondary sanctions: the exposure of European companies

A European company with no US operations can be caught by US sanctions in three ways. The first is a US nexus: a dollar payment cleared through a US bank, a US-national employee or director, a US-origin component, software or technology subject to the Export Administration Regulations. The second is OFAC’s 50 percent rule, which extends asset blocking to any entity owned 50 percent or more by one or more SDN-listed persons, even if the entity itself is not listed. The third is secondary sanctions, under which the United States threatens to designate or cut off from its financial system foreign persons engaging in significant transactions with certain targets, notably in Russia- and Iran-related programmes.

EU law responds with Regulation (EC) No 2271/96, the Blocking Statute, whose Article 5 prohibits EU operators from complying with the listed US laws and which the Court of Justice has made enforceable by a counterparty whose contract was terminated (CJEU, Grand Chamber, 21 December 2021, Bank Melli Iran, C-124/20). In practice the company is caught between the risk of US sanctions, its bank’s compliance department refusing the transfer, and the EU prohibition on yielding. The firm analyses the actual nexus, structures flows and contractual clauses, and negotiates with financial institutions.

How the firm works

The firm responds urgently to bank blockages or the designation of a partner, then structures the response: analysis of the connecting link, licence application, contractual notice, suspension or exit from the contract. It represents designated persons before the EU courts and the French authorities.

The firm has published a procedural guide on challenging international sanctions and a six-point analysis, available in English from the international trade law page.

Typical cases handled

The situations below are illustrative, anonymised scenarios. They show when the firm steps in and what the work consists of.

Transfer blocked by the bank for a Central Asian customer

A bank refuses a payment citing a circumvention risk. The firm documents the absence of any link with a designated person and obtains release of the block.

Customer designated during the contract

A distributor is listed by the EU. The firm organises suspension of the contract, relies on Article 11 of Regulation 833/2014 against its claims and secures the stock.

Executive designated and action for annulment

A foreign executive resident in France is designated. The firm brings the action before the General Court and the application for release of funds for basic needs.

French-flagged yacht, sanctioned owner, American buyer

A French-flagged yacht is held, through a company, by a person listed in Annex I to Regulation (EU) No 269/2014. An American buyer comes forward, the price is agreed, the broker is pressing. The asset freeze prohibits making any economic resource available to the designated person: without an authorisation from the French Treasury (Direction générale du Trésor), the sale is prohibited, and the price itself would be frozen in the hands of whoever receives it. The American buyer has constraints of his own, since OFAC bars him from dealing with a person on the SDN list if the seller is also listed there. We traced the ownership chain to the beneficial owner, assessed the position under both regimes, and organised the prior authorisation request with the price held in escrow, in coordination with the buyer’s US counsel. Without that work the sale was unlawful and exposed every participant, broker included, to criminal proceedings.

Frequently Asked Questions

Who is bound by European Union sanctions?

Union restrictive measures bind nationals of Member States wherever they are, any person present on the territory of the Union, any legal person incorporated under the law of a Member State, and any business done wholly or partly within the Union. That reach catches a French subsidiary of a foreign group and a foreign subsidiary of a French group in different ways, which is why the group’s map is drawn before the compliance rules are written. Directors and employees fall personally within the scope, not only the company that employs them.

How is a company’s exposure assessed?

By mapping counterparties, beneficial owners, goods, end uses, destinations, banks, carriers and intermediaries against the applicable lists, and by repeating the exercise whenever one of them changes. Ownership and control rules mean that an entity which is not itself listed can still be caught because a listed person holds more than half of it or controls it in fact. The analysis therefore concerns structures as much as names, and screening software on its own does not answer the control question.

What are the penalties in France?

Breaches are criminal offences, prosecuted alongside customs and financial penalties, and they expose the company as well as the individuals who took the decision. The French customs code was recodified by the ordonnance of 8 April 2026, in force since 1 May 2026, so older references to the former numbering should be checked before being relied on. Directive (EU) 2024/1226 of 24 April 2024 requires Member States to criminalise the violation of Union restrictive measures, which has raised penalty levels and harmonised the offences across the Union.

Can a listing be challenged?

Yes. An action for annulment lies before the General Court of the European Union within the applicable time limit running from publication or notification of the listing decision, and a delisting request may be addressed to the Council at any time. The case turns on the evidence file relied on by the institution and on whether it supports the listing criteria invoked. Because the time limit is short and the file has to be requested, the first step is procedural rather than argumentative.

Can a licence or derogation be obtained?

Yes, in the cases the regulations provide for: payment of professional fees, basic needs, contracts concluded before the listing, humanitarian operations, and certain transactions authorised for a defined purpose. In France the request is made to the Treasury, and the file must describe the operation, the parties and the safeguards precisely. Obtaining a licence is often more urgent for the business than the outcome of an annulment action, because it unblocks payment and performance while the challenge runs its course.

How do American sanctions affect a French company?

Through the extraterritorial reach of certain American programmes, which can catch dollar payments, goods and technology of American origin, and persons subject to United States jurisdiction. A French company can therefore face an obligation under one legal order and a prohibition under the other, and Regulation 2271/96, the blocking statute, restricts compliance with certain listed American measures. The way out is rarely a pure legal argument: it is a transaction structure that avoids the conflict, designed before the contract is signed.