Overview
The Sanctions Update is compiled by Steptoe’s International Trade and Regulatory Compliance team and Steptoe’s Strategic Risk team. You can subscribe to receive the Sanctions Update every week through Steptoe’s International Compliance Blog and Stepwise Risk Outlook publication home pages.
For more information or advice on any of the developments discussed below, please contact a member of our sanctions team here.
US Developments
Trump and Putin Meet in Alaska to Discuss Ukraine Peace Deal
On August 15, President Donald Trump and Russian President Vladimir Putin met in Alaska to discuss a peace deal to end the Russian war in Ukraine. This summit marked the first meeting between a US President and Putin, who is still subject to US sanctions, since Russia’s 2022 invasion of Ukraine. Trump, Secretary of State Marco Rubio, and special envoy Steve Witkoff publicly hailed the progress on peace discussions at the summit, although Rubio said on Sunday that “big areas of disagreement” remain and that a peace agreement is still “a long ways off.”
The details of the negotiations have not been released, but public reporting suggests that Putin proposed a peace deal that would cement Russia’s territorial gains in Ukraine and, in the Donbas, extend Russia’s territorial gains past the current frontline. Ukrainian President Volodymyr Zelensky explicitly rejected that proposal when asked by reporters. Zelensky and several European leaders are scheduled to meet with Trump at the White House on Monday.
Trump had recently expressed frustration with Putin because of Russia’s continual attacks on Ukraine and had threatened significant new sanctions, including secondary tariffs. Trump imposed secondary tariffs on India on August 6 for its importation of Russian oil, but has not imposed further sanctions against Russia. It is unclear whether the Trump administration is still considering the adoption of stronger sanctions, which it may view as a tool to coax Russia into a peace deal.
OFAC Targets Crypto Exchange for Malicious Cyber Activities
The Department of the Treasury’s Office of Foreign Assets Control (OFAC) has sanctioned Garantex Europe OU (“Garantex”), a Russia-based cryptocurrency exchange, and certain of its senior executives, for their alleged involvement in malicious cyber activities. OFAC concurrently designated Garantex’s successor, Grinex, and six associated companies in Russia and the Kyrgyz Republic, which it alleges either participated in the malicious cyber activities or in sanctions evasion schemes related to them.
Garantex was previously designated pursuant to Executive Order (EO) 14024 on April 5, 2022, for operating or having operated in the financial services sector of the Russian economy. Specifically, OFAC alleged, at that time, that Garantex processed millions of dollars’ worth of illicit transactions in violation of anti-money laundering (AML) and countering the finance of terrorism (CFT) regulations. Garantex’s re-designation under cyber authorities (EO 13694) reiterated this point and built on it, alleging that Garantex also “directly facilitated notorious ransomware actors.”
The recent designations closely follow the Department of Justice’s (DOJ) coordinated action with Germany and Finland, announced March 7, 2025, to “take down” the online infrastructure used to operate Garantex, and its concurrent unsealing of indictments against certain Garantex officers. The DOJ enforcement action and OFAC designations both align with Deputy Attorney General Todd Blanche’s Memorandum from April 7, 2025, in which he stated that, pursuant to EO 14178, the DOJ will prioritize, among other things, investigations and prosecutions involving those who use digital assets in furtherance of criminal offenses.
OFAC’s designation of Garantex, Grinex, and associated personnel and companies aligns with Treasury’s previous targeting of Cryptex, PM2BTC, SUEX, Shatex, Bitpapa, NetEx24, and AWEX, all of which were sanctioned or identified as being a primary money laundering concern by the Financial Crimes Enforcement Network (FinCEN) for their alleged provision of financial services to criminal actors, or alleged facilitation of illicit activities.
Treasury Sanctions Increase Pressure on Mexican Cartels with New Sanctions
Last week, OFAC continued its sanctions campaign against cartels and their supporters or affiliates. Across two separate actions, OFAC imposed sanctions on two cartels, 11 individuals, and 13 companies for various alleged unlawful activities.
On August 13, OFAC designated four Mexican individuals and 13 Mexican companies for their alleged connections to a timeshare fraud led by the Cartel de Jalisco Nueva Generacion (CJNG), a Foreign Terrorist Organization (FTO) and Specially Designated Global Terrorist (SDGT). OFAC noted that this was the fifth time it has sanctioned those connected to CJNG’s timeshare fraud activities, following related actions on July 16, 2024, November 30, 2023, April 27, 2023, and March 2, 2023. OFAC has previously issued a Notice to help financial institutions identify and report suspicious activity related to timeshare fraud, specifically that which is orchestrated by Mexico-based transnational criminal organization (TCO).
On August 14, OFAC sanctioned two Mexican cartels—Carteles Unidos (a.k.a. United Cartels) and Los Viagras—as well as seven affiliated individuals allegedly connected to terrorism, drug trafficking, and extortion in Mexico’s agricultural sector. OFAC stated that this action was in furtherance of President Trump’s Directive from January 20, 2025, which called for, among other things, the “total elimination” of cartels and TCOs.
OFAC Designates Entities Linked to Violence and Illegal Mining in the DRC
OFAC has sanctioned multiple entities it says are connected to armed group violence and the illicit sale of critical minerals in the Democratic Republic of the Congo (DRC). These include Coalition des Patriotes Résistants Congolais-Force de Frappe (PARECO-FF), a successor movement to PARECO, which allegedly generated revenue by overseeing mining operations, collecting illegal fees and taxes from miners, and engaging in minerals smuggling, as well as a Congolese mining company and two of its Hong Kong-based export companies.
The State Department has previously highlighted concerns with the illicit trade and exploitation of minerals that contribute to instability in the DRC. The Trump administration is particularly concerned with the “conflict mineral” trade in the DRC as it attempts to secure a resolution to the conflict in the eastern part of that country.
State Department Imposes Visa Restrictions for Involvement with Cuban Forced Labor
On August 13, the State Department announced that it was taking steps to impose visa restrictions on African, Cuban, and Grenadian government officials, and their family members, for their alleged involvement in the Cuban regime’s “medical mission” labor export scheme. Concurrently, the State Department announced that it was taking steps to revoke visas and impose visa restrictions on several Brazilian government officials, former Pan American Health Organization (PAHO) officials, and their family members, for their alleged complicity with the Cuban regime’s labor export scheme in the Mais Médicos program.
The Trump administration first expanded the Cuba-related visa restriction policy targeting Cuba’s forced labor export program on February 25, 2025. These most recent actions follow the related visa restrictions imposed on several Central American government officials and their family members on or around June 3, 2025. According to the Trump administration, these programs exploit Cuban medical workers while enriching the Cuban government.
EU Developments
EU To Prepare 19th Sanctions Package Against Russia
Following a meeting of EU foreign ministers on August 11, the High Representative for Foreign Affairs Kaja Kallas confirmed that the EU will begin preparing its 19th sanctions package against Russia. In the reported statement, Kallas underscored the importance of maintaining pressure on Russia and cautioned against any discussions of concessions until Russia agrees to a full and unconditional ceasefire. The confirmation came ahead of US President Trump’s high-profile meeting with President Putin in Alaska, in which the leaders reportedly discussed a peace deal that would cement Russian territorial gains in Ukraine—and from which European and Ukrainian leaders were excluded.
EU Council Amends Sanctions Against Iraq
The EU Council has amended Council Regulation 1210/2003, which imposes specific restrictions on economic and financial relations with Iraq, following a recent update at the UN level. Commission Implementing Regulation 2025/1751 revises the list of sanctioned individuals and entities associated with the former regime of Saddam Hussein, aligning with changes made by the UN Sanctions Committee on August 5, 2025. This amendment specifically updates Annex IV of Council Regulation 1210/2003 to reflect the revised sanctions list. The designated individuals and entities are subject to asset freezes on their funds and economic resources.
Third Countries Align with EU Sanctions Targeting Russia And Lebanon
The High Representative of the EU has announced that Albania, Bosnia and Herzegovina, Iceland, Liechtenstein, Montenegro, North Macedonia, Norway, and Ukraine have aligned themselves with several Council decisions from the 18th sanctions package against Russia. First, these countries have aligned themselves with Council Decision 2025/1478, which added 14 individuals and 41 entities responsible for actions undermining or threatening the territorial integrity, sovereignty and independence of Ukraine to the listing set out in the Annex to Decision 2014/145/CFSP. Second, they have aligned themselves with Council Decision 2025/1495, introducing a set of restrictive measures targeting Russia’s energy, banking and military-industrial sectors. Third, these countries have aligned themselves with Council Decision 2025/1471, which imposes further restrictive measures to minimize the risk of circumvention. Lastly, the fourth alignment concerns Council Decision 2025/1461, which amended the list of individuals and entities subject to restrictive measures outlined in Annexes I and II to Decision 2012/642/CFSP.
On August 12, the High Representative of the EU announced that Albania, Bosnia and Herzegovina, Iceland, Liechtenstein, Montenegro, North Macedonia, Republic of Moldova, Serbia, and Ukraine have aligned themselves with Council Decision 2025/1555. This Council decision extended the framework for imposing targeted restrictive measures to address the situation in Lebanon for an additional year, until July 31, 2026.
Asia-Pacific Developments
China Retaliates Against EU Over Russia-Related Sanctions
In response to EU sanctions on two Chinese financial institutions, China’s Ministry of Commerce (MOFCOM) has announced countermeasures against two European banks—UAB Urbo Bankas and AB Mano Bankas—effective August 13, 2025. MOFCOM cited violations of international law and harm to the legitimate interests of Chinese companies as the basis for its decision. Under China’s Anti-Foreign Sanctions Law (AFSL), and with approval from the national anti-foreign sanctions coordination mechanism, Chinese individuals and organizations are now prohibited from engaging in transactions or cooperation with the two EU banks. These countermeasures follow the EU’s 18th round of sanctions against Russia. In response, the EU has called on China to lift what it describes as “unjustified” sanctions, arguing that the move is largely symbolic since the targeted banks do not operate in China.
Iran Teams with China, Russia to Block European Sanctions Over Nuclear Deal
Iranian Foreign Minister Abbas Araghchi stated that Iran is working with China and Russia to prevent the reimposition of European sanctions over its nuclear program, after Britain, France, and Germany threatened to trigger the 2015 deal’s snapback mechanism if no diplomatic solution is reached by late August. The Joint Comprehensive Plan of Action (JCPOA), which lifted sanctions in exchange for nuclear limits, is set to expire in October and has largely unraveled since the US withdrew in 2018. Iran has since increased uranium enrichment, and tensions rose further after US and Israeli strikes on Iranian nuclear sites. Iran denies seeking nuclear weapons despite Western accusations.
Nayara Energy Strives to Maintain Fuel Supply Amid EU Sanctions
Russia-backed Nayara Energy, a major Indian refiner, announced it is working with government authorities and partners to maintain stable operations and fuel supplies at its 400,000 barrels-per-day Vadinar refinery, despite EU sanctions disrupting its supply chain. The sanctions, targeting entities linked to Russian oil, have forced Nayara to reduce output to 70–80%, impacted exports, and led to executive resignations and shipping challenges. Despite these setbacks, Nayara continues to supply fuel across India via coastal, rail, and road networks, operating its retail stations normally and seeking assistance from India’s shipping ministry to secure vessels for fuel transport.
Japan Probes Sanctions Evasion in Exports to Russian Defense Firms
Japan's Ministry of Economy, Trade and Industry (METI) uncovered a sanctions-evasion scheme where over 300 precision tools from Tsugami Corp. were diverted to Russia via Chinese firms, with 30 already traced to Russian territory. Japan has ordered Tsugami to cut ties with the implicated companies and halt support for equipment in Russia. A parallel probe found that Ferrotec Holdings Corp., a Japanese firm led by a Chinese CEO, had supplied chemicals and tools to Russian defense contractors. Ferrotec has since suspended several contracts and pledged tighter monitoring.
Myanmar Junta Acquires European Drone Tech Despite Sanctions
Despite EU sanctions, Myanmar’s military junta has acquired and deployed European anti-jamming technology in combat drones, according to Conflict Armament Research (CAR). The advanced GNSS modules, originally shipped to a commercial firm near the China-Myanmar border under non-military use declarations, were later diverted to the junta and integrated into modified quadcopters and hexacopters. This case reflects a broader pattern of sanctioned entities obtaining commercial components to enhance military capabilities. The ongoing civil war and continued foreign arms flows, including supplies from Russia, China, and Serbia, have raised international concerns, especially following the US decision to lift certain sanctions on Myanmar-linked entities.
