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  2. The Iran (Sanctions) (Nuclear) (EU Exit) (Amendment) Regulations 2025

The Iran (Sanctions) (Nuclear) (EU Exit) (Amendment) Regulations 2025

Published: Tue 30th Sept 25

These Regulations, made by the Secretary of State under the Sanctions and Anti-Money Laundering Act 2018, amend the existing Iran (Sanctions) (Nuclear) (EU Exit) Regulations 2019 to align UK law with updated United Nations Security Council obligations, particularly those derived from Resolution 2231 (2015).

The amendments update interpretations of relevant UN resolutions, modify the scope of prohibited trade in nuclear and missile-related items, and introduce specific exceptions to asset freeze and financial prohibitions to facilitate the satisfaction of obligations owed by the Treasury concerning Treasury debt, ensuring these actions remain compliant with the new sanctions framework.

Arguments For

  • Ensures the UK's domestic sanctions regime under the Sanctions and Anti-Money Laundering Act 2018 aligns with updated United Nations Security Council obligations concerning Iran's nuclear programme, primarily implementing Resolution 2231 (2015) in the post-EU exit context.

  • Clarifies and updates definitions related to UN Security Council Resolutions (1737, 1747, 1803, 1929) to provide legal certainty for enforcement bodies and regulated entities regarding targeted sanctions and prohibited trade (e.g., missile-list goods).

  • Introduces specific, controlled exceptions to asset freeze prohibitions to allow payments related to certain Treasury debt obligations, preventing unintended breaches of UK sanctions when dealing with persons who might otherwise be designated, preserving necessary financial functions related to UK sovereign debt.

  • Maintains continuity for existing judicial decisions and licenses by clarifying transitional provisions, ensuring that obligations that arose when persons were not designated remain manageable under the amended framework.

Arguments Against

  • The introduction of new exceptions for Treasury debt could create avenues for funds to reach designated Iranian entities indirectly, requiring stringent compliance and monitoring to prevent sanctions evasion.

  • Updating definitions regarding 'missile-list goods' and 'nuclear-list technology' by referencing revised IAEA documents introduces complexity, potentially leading to confusion or delayed implementation if domestic guidance lags behind UN/IAEA updates.

  • These regulations implement obligations derived through UN Security Council Resolution 2231, which replaced the Joint Comprehensive Plan of Action (JCPOA); this shifts the legal basis for certain restrictions which might be viewed domestically as less comprehensive or politically controversial than the previous EU/JCPOA arrangements.

  • The amendment process, which updates several core regulations, increases the compliance burden on financial institutions required to understand cross-references between older UN resolutions (like 1737) as they are read with newer ones (like 2231).

The Secretary of State1, considering that the condition in section 45(2) of the Sanctions and Anti-Money Laundering Act 2018 (“the Act”)2 is met, makes these Regulations in exercise of the powers conferred by sections 1(1)(a) and (3)(a), 9(2)(b), 13, 15(2)(a) and (b), (3), 54(1) and (2) of, and paragraphs 5(c), 17, 19, 20 and 23 of Schedule 1 to, the Act.

Citation, commencement and extent1.

(1)

These Regulations may be cited as the Iran (Sanctions) (Nuclear) (EU Exit) (Amendment) Regulations 2025.

(2)

These Regulations come into force on 1st October 2025.

(3)

These Regulations extend to England and Wales, Scotland and Northern Ireland.

Amendment2.

The Iran (Sanctions) (Nuclear) (EU Exit) Regulations 20193 are amended in accordance with regulations 3 to 10 of these Regulations.

Interpretation3.

In regulation 2 (interpretation)—

(a)

in the definition of “resolution 1737”, after “resolution 1737”, the second time it occurs, insert “(2006)”;

(b)

after the definition of “resolution 1737” insert—

““resolution 1747” means resolution 1747 (2007) adopted by the Security Council on 24 March 2007;

“resolution 1803” means resolution 1803 (2008) adopted by the Security Council on 3 March 2008;

“resolution 1929” means resolution 1929 (2010) adopted by the Security Council on 9 June 2010;”;

(c)

in the definition of “resolution 2231”, after “resolution 2231”, the second time it occurs, insert “(2015)”.

Purposes4.

(1)

Regulation 4 (purposes) is amended as follows.

(2)

In paragraph (2)—

(a)

at the end of sub-paragraph (a), insert “and”;

(b)

omit sub-paragraph (c) and the preceding “and”.

(3)

In paragraph (3)—

(a)

in sub-paragraph (a), for the words “7(b) of, and paragraph 6(c) of Annex B to, resolution 2231”, substitute “12 of resolution 1737”;

(b)

for sub-paragraph (b), substitute—

(b)

the obligations that the United Kingdom has by virtue of paragraph 12 of resolution 1737 in respect of persons—

(i)

acting on behalf of or at the direction of, or

(ii)

owned or controlled by,

the persons for the time being named by the Security Council or the Committee for the purposes of paragraph 12 of resolution 1737;”;

(c)

after sub-paragraph (b), as substituted, insert—

(c)

the obligations that the United Kingdom has by virtue of paragraphs 3, 4, 6 and 7 of resolution 1737 and paragraph 8 of resolution 1803 (certain nuclear-related goods and technology and connected trade);

(d)

the obligations that the United Kingdom has by virtue of paragraph 5 of resolution 1737 and paragraph 8 of resolution 1929 (arms and related materiel and connected trade);

(e)

the obligations that the United Kingdom has by virtue of paragraph 7 of resolution 1929 (commercial activity involving uranium mining, nuclear materials, etc);

(f)

the obligations that the United Kingdom has by virtue of paragraph 18 of resolution 1929 (bunkering services in respect of Iran-related ships);

(g)

the obligations that the United Kingdom has by virtue of paragraph 22 of resolution 2231 (notification etc, related to certain activities).”;

(d)

after paragraph (3), insert—

(4)

In paragraph (3)(a) and (b), the reference to paragraph 12 of resolution 1737 is a reference to that paragraph as read with—

(a)

paragraph 4 of resolution 1747;

(b)

paragraph 7 of resolution 1803;

(c)

paragraphs 11, 12 and 19 of resolution 1929.

(5)

In paragraph (3)(c), the reference to paragraphs 3, 4, 6 and 7 of resolution 1737 is a reference to those paragraphs as read with paragraph 13 of resolution 1929.”.

Criteria for designating a person5.

In regulation 6(4) (designation criteria: meaning of “involved person”)—

(a)

in paragraph (c) of the definition of “relevant provision”, for “resolution 2231” substitute “a relevant resolution”;

(b)

after the definition of “relevant provision” insert—

““relevant resolution” means resolution 1737, resolution 1747, resolution 1803 or resolution 1929;”.

Designation of persons named by or under UN Security Council Regulations6.

In regulation 10 (designation of persons named by or under UN Security Resolutions), for paragraph (1), substitute—

(1)

Each person for the time being named for the purposes of paragraph 12 of resolution 1737 by the Security Council or the Committee is a designated person for the purposes of regulations 12 to 17 (asset freeze etc) (whose purposes include compliance with the UN obligation mentioned in regulation 4(3)(a)).

(1A)

In paragraph (1), the reference to paragraph 12 of resolution 1737 is a reference to that paragraph as read with—

(a)

paragraph 4 of resolution 1747,

(b)

paragraph 7 of resolution 1803, and

(c)

paragraphs 11, 12 and 19 of resolution 1929.”.

Interpretation of Part 57.

In regulation 34 (interpretation of this Part)—

(a)

in paragraph (1), in the definitions of each of “missile-list goods” and “missile-list technology”—

(i)

after “specified in”, insert “the Annex to”;

(ii)

for “S/2015/546” substitute “S/2012/947, as that Annex is revised or re-issued from time to time by the Security Council or the Committee,”;

(b)

for paragraph (2), substitute—

(2)

For the purposes of the definitions of “nuclear-list goods” and “nuclear-list technology”, a thing is “specified in a relevant International Atomic Energy Agency list” if it is specified in Annexes to either of the following International Atomic Energy Agency documents, as those Annexes are revised or re-issued from time to time by the Security Council or the Committee—

(a)

INFCIRC/254/Rev.11/Part 1, and

(b)

INFCIRC/254/Rev.8/Part 2.”.

Finance: exceptions from prohibitions8.

(1)

In regulation 37 (finance: exceptions from prohibitions), in paragraph (5), for “before the date on which the person became” substitute “on a date when the person was not”.

(2)

After regulation 37ZZA, insert—

“Finance: exceptions relating to payment of Treasury debt37ZZB.

(1)

The prohibitions in regulations 12 to 14 (asset-freeze and making funds available to or for benefit of designated persons) and regulation 17 (financial messaging services) are not contravened by any act done by a person to transfer funds to—

(a)

a UN designated person (“D”) in order to satisfy an obligation owed by the Treasury to D in respect of Treasury debt where the conditions in paragraph (2) are met; or

(b)

a person (“B”) in respect of Treasury debt where the effect of the transfer is to make funds available to or for the benefit of D and the conditions in paragraph (3) are met.

(2)

The person (“P”) making the transfer of funds to D knows or has reasonable cause to suspect that the obligation referred to in paragraph (1) arose on a date when D was not a designated person and P takes reasonable steps to satisfy itself that the funds to be transferred to D are credited to a specified account.

(3)

The person (“P”) making the transfer of funds to B knows or has reasonable cause to suspect that the effect of such a transfer will be to enable the satisfaction of an obligation of any person to D in respect of Treasury debt and P takes reasonable steps to satisfy itself that such obligation arose on a date when D was not a designated person and the funds to be transferred to D are ultimately credited to a specified account.

(4)

The prohibitions in regulations 12 to 14 and regulation 17 are not contravened by any act done by a person (where that person is not P in paragraph (2) or (3)) to enable a transfer of funds to any person in respect of Treasury debt—

(a)

in order to satisfy an obligation owed by the Treasury to D, or

(b)

where the effect of the transfer will be to enable the satisfaction of an obligation of any person to D in respect of Treasury debt.

(5)

For the purposes of this regulation, references to a UN designated person, in so far as they relate to a designated person (within the meaning of regulation 11), are to be read as including a person who is owned or controlled directly or indirectly (within the meaning of regulation 7) by the UN designated person.

(6)

In this regulation—

“corresponding non-UK country” means a non-UK country whose laws contain relevant—

(a)

prohibitions and exceptions corresponding to regulations 12 to 14, regulation 17 and regulation 37 (finance: exceptions from prohibitions); and

(b)

grounds for licences to be issued that correspond to the purposes in Schedule 2 (Treasury licences: purposes);

“frozen account” has the meaning given in regulation 37(7);

“non-UK country” means a country that is not the United Kingdom;

“non-UK relevant institution” means—

(a)

a person, other than an individual, which would satisfy the threshold conditions for permission under Part 4A of the Financial Services and Markets Act 20004 if it had its registered office (or if it does not have one, its head office) in the United Kingdom, or

(b)

an undertaking which by way of business—

  1. (i)

    operates a currency exchange office,

  2. (ii)

    transmits money (or any representation of monetary value) by any means, or

  3. (iii)

    cashes cheques that are made payable to customers;

“recognised CSD” has the meaning given in section 285(1)(e) of the Financial Services and Markets Act 20005;

“relevant money market instrument” means an instrument of a kind normally dealt in on the money market, such as treasury bills, certificates of deposit and commercial papers, excluding instruments of payment;

“relevant transferable security” means a security, negotiable on the capital market, of any of the following kinds, but excluding instruments of payment—

(a)

shares in companies and other securities equivalent to shares in companies, partnerships or other entities, and depositary receipts in respect of shares;

(b)

bonds or other forms of securitised debt, including depositary receipts in respect of such securities;

(c)

any other securities giving the right to purchase or sell any security of a kind mentioned in paragraph (a) or (b);

“specified account” means—

(a)

a frozen account of a person;

(b)

an account held by or for the benefit of a person with a recognised CSD;

(c)

an account held by or for the benefit of a person with a non-UK relevant institution in a corresponding non-UK country; or

(d)

an account held by or for the benefit of a person with a third country CSD in a corresponding non-UK country,

where the person referred to in (a) to (d) above is also D in paragraph (2) or (3);

“third country CSD” has the meaning given in section 285(1)(g) of the Financial Services and Markets Act 20006;

“Treasury debt” means any relevant transferable security, relevant money market instrument, loan or credit entered into or issued by, or on behalf of the Treasury in respect of funds borrowed by or on behalf of the Treasury;

“UN designated person” has the meaning given in regulation 37ZZA(8).”.

Transitional provisions: prior obligations9.

In regulation 78 (transitional provisions: prior obligations)—

(a)

omit paragraph (2);

(b)

in paragraph (3)—

(i)

for the opening words, substitute “The provision referred to in paragraph (1) is—”

(ii)

at the end of sub-paragraph (a), omit “and”;

(iii)

after sub-paragraph (a), insert—

(ab)

regulation 37ZZB (finance: exceptions relating to payment of Treasury debt), and”.

Treasury Licences: purposes10.

(1)

Schedule 2 (Treasury licences: purposes) is amended as follows.

(2)

In paragraph 6 (prior obligations)—

(a)

renumber the existing text as sub-paragraph (1);

(b)

in sub-paragraph (1), as so renumbered—

(i)

in paragraph (a), for “before the date on which the person became” substitute “at a time when the person was not”;

(ii)

in paragraph (b), for “Annex B of resolution 2231” substitute “paragraphs 3, 4 and 6 of resolution 1737”;

(iii)

at the end of paragraph (b), omit “and”;

(iv)

at the end of paragraph (c), insert “, and”;

(v)

after paragraph (c), insert—

(d)

where sub-paragraph (2) applies, the activities contemplated under, and execution of, such obligations are consistent with—

(i)

the Joint Comprehensive Plan of Action, and

(ii)

the provisions of resolutions 1696, 1737, 1747, 1803, 1835, 1929 and 2231.”;

(c)

after sub-paragraph (1), as so renumbered, insert—

(2)

This sub-paragraph applies where the obligation concerned arose at a time when the person concerned ceased to be a designated person pursuant to paragraph 7 of resolution 2231.”.

(3)

Omit paragraph 7 (activities related to the Joint Comprehensive Plan of Action).

(4)

Before paragraph 7A (pre-existing judicial decisions etc.), insert—

“7ZA.

To enable anything that is necessary—

(a)

for activities directly related to the items specified in the lists referred to in sub-paragraphs 3(b)(i) and (ii) of resolution 1737, as those lists are revised or re-issued from time to time by the Security Council or the Committee;

(b)

for the supply, sale, or transfer of items, materials, equipment, goods and technology, and the provision of any related technical assistance, training, financial assistance, investment, brokering or other services, by participant States of the Joint Comprehensive Plan of Action, or Member States acting in coordination with them, that falls within paragraph 22 of resolution 2231 and is directly related to—

(i)

the modification of two cascades at the Fordow facility for stable isotope production;

(ii)

the export of Iran’s enriched uranium in excess of 300 kilograms in return for natural uranium; and

(iii)

the modernization of the Arak reactor based on the agreed conceptual design and, subsequently, on the agreed final design of such reactor;

(c)

for transfers and activities falling within sub-paragraphs (a), (b) or (c) of paragraph 23 of resolution 2231.”.

(5)

In paragraph 7A—

(a)

renumber the existing text as sub-paragraph (1);

(b)

in sub-paragraph (1), as so renumbered—

(i)

in paragraph (b)(i) for “before the date on which the person became” substitute “at a time when the person was not”;

(ii)

at the end of paragraph (b), omit “and”;

(iii)

at the end of paragraph (c), insert “, and”;

(iv)

after paragraph (c), insert—

(d)

where sub-paragraph (2) applies, the activities to which the decision or the lien relate are consistent with—

(ii)

the Joint Comprehensive Plan of Action, and

(iii)

the provisions of resolutions 1696, 1737, 1747, 1803, 1835, 1929, and 2231.”;

(c)

after sub-paragraph (1), as so renumbered, insert—

(2)

This sub-paragraph applies where the decisions or liens concerned were made or established at a time when the person concerned ceased to be a designated person pursuant to paragraph 7 of resolution 2231.”.

Stephen Doughty
Minister of State
Foreign, Commonwealth and Development Office
Explanatory Note
(This note is not part of the Regulations)

These Regulations amend the Iran (Sanctions) (Nuclear) (EU Exit) Regulations 2019 (“the 2019 Regulations”) to reflect the United Nations (“UN”) obligations imposed in relation to Iran by virtue of paragraph 12 of UN Security Council Resolution 2231 (2015).

In particular, the purposes of the regulations (regulation 4) have been updated to reflect the new United Nations obligations in relation to the situation in Iran.

The definitions of “missile-list goods” and “nuclear-list technology” which are subject to prohibitions on the export to, and imports from, Iran, and related activities, as well as other trade restrictions in relation to Iran, are also extended (see the amendments to regulation 34 of the 2019 Regulations).

The Regulations add a new exception to the prohibitions in regulations 12 to 14 of the 2019 Regulations (asset freezes and making funds available to or for the benefit of designated persons) to ensure payments can be made in respect of certain funds borrowed by or on behalf of the Treasury (including gilts) and that those payments can be facilitated. They also extend the purposes for which the Treasury may issue licences to permit activities which would otherwise be prohibited under UN financial sanctions.

An Impact Assessment has not been produced for these Regulations, as they implement UN obligations. An Impact Assessment was, however, produced for the Sanctions and Anti-Money Laundering Act 2018 and can be found at: https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/653271/Sanctions_and_Anti-Money_Laundering_Bill_Impact_Assessment_18102017.pdf.

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