01
Chapter 1 · Key terms
In everyday speech many things are called a blockade. In law, four things can be distinguished, and they work very differently.
An embargo prohibits trade with a country, entirely or for certain goods. An arms embargo covers only military goods. A comprehensive embargo such as the US embargo on Cuba covers almost all transactions by persons and companies subject to US law.
Source: Cuban Assets Control Regulations, 31 CFR Part 515
Sanctions, called “restrictive measures” in the EU, are usually more targeted: asset freezes and travel bans on listed individuals and companies, bans on certain sectors, services or financial transactions. Anyone listed is named in an annex.
Source: Art. 29 TEU, Art. 215 TFEU
Some sanctions laws do not apply only to a country’s own citizens and companies. They also threaten companies in other states with penalties if they do business with a listed country. The US order on Cuba of 1 May 2026, for example, allows sanctions on foreign banks up to the loss of their correspondent accounts in the United States.
Source: Helms-Burton Act 1996; King & Spalding, 6 May 2026, on the order of 1 May 2026
Out of caution, banks and companies often do more than the law requires: they refuse permitted payments or terminate entire groups of customers. On 5 January 2022 the European Banking Authority wrote that unwarranted de-risking can exclude legitimate customers from the financial system and can be a sign of ineffective risk management.
Source: EBA, press release of 5 Jan 2022 (EBA/Op/2022/01)
Under Article 41 of the UN Charter the Security Council can decide on measures not involving armed force, such as interrupting economic relations. Its decisions bind all member states (Article 25).
Source: Charter of the United Nations, Arts. 25 and 41
The Council of the EU adopts sanctions unanimously as a decision under the Common Foreign and Security Policy and implements the economic parts through regulations. They apply in the EU and to persons and companies from the EU, also abroad. The EU implements UN decisions and has its own regimes.
Source: Arts. 29 and 31 TEU, Art. 215 TFEU
Besides the United States, the United Kingdom, Canada, Switzerland, Norway, Japan, Australia, New Zealand, South Korea and Ukraine, among others, maintain their own regimes or lists; Russia, China and Iran respond with countermeasures (overview in chapter 2). In the US they are administered by OFAC in the Treasury Department. Anyone who pays in US dollars or uses US banks comes into contact with US sanctions, even outside the United States; the UN Special Rapporteur criticises this reliance on the dollar.
Source: OHCHR, 21 Nov 2025; King & Spalding, 6 May 2026
The United Nations uses the term unilateral coercive measures for sanctions imposed by individual states or groups of states without a Security Council decision. The Human Rights Council has appointed a Special Rapporteur on them, currently Alena Douhan. Her report of 4 September 2023 to the General Assembly deals with secondary sanctions and over-compliance. Whether such measures are lawful under international law is disputed among states.
Source: United Nations, A/78/196 of 4 Sep 2023
All references with dates are in the list of sources.