Sanctions and Export Controls Update: U.S. Sanctions and Export Controls – Heightened Enforcement

The U.S. continues to intensify enforcement of its sanctions and export control frameworks in furtherance of national security and foreign policy objectives. Recent weeks have witnessed coordinated actions by the U.S. Department of the Treasury and the U.S. Department of Commerce targeting activities linked to Iran and to restricted semiconductor exports to China. These actions underscore the broad extraterritorial reach of U.S. sanctions laws and export control regulations.

Notably, recent measures span multiple jurisdictions including India, China, and Korea demonstrating that enforcement activity is not limited by geography and may extend to non-U.S. entities engaged in transactions deemed sanctionable under U.S. law.

The U.S. Department of the Treasury has designated an India-based maritime services company and its director in connection with transactions involving Iranian petroleum.[1]

According to the designation, Elevate Marine Management Private Limited, an India-based commercial manager of a crude oil tanker named Benedict[2], operating under a Cameroon flag, was alleged to have facilitated the transport of Iranian-origin petroleum products on at least three occasions between September and November 2025.

The company was designated pursuant to Executive Order 13846 for knowingly engaging in a significant transaction involving the transport of Iranian petroleum or petroleum products. The vessel associated with the activity was identified as property in which the designated entity has an interest.

The company’s director, Akash Anant Shinde, an Indian national, was also designated on the basis of serving as a principal executive officer of the sanctioned entity.

As a result, the implications of listing the aforementioned entities/ persons under the SDN list include inter alia the following:

• The property and interests in property of these entities/ persons that are in the U.S. or in the possession or control of U.S. persons are blocked. As an illustration, the bank accounts or funds of such entities/ persons in the U.S. would be blocked.
• Any entities that are owned, directly or indirectly, fifty (50) percent or more by one or more blocked persons are also blocked.

The US persons, or non-US persons dealing with such designated or blocked persons also run the risk of violating US sanctions.  Subject to the above action, the OFAC may also investigate the sale of the petroleum products (shipped from Iran) to firms/ persons, whereby such firms/ persons may run a risk of being sanctioned.

[1] See, URL for Factsheet: Sanctions to Combat Illicit Traders of Iranian Oil and the Shadow Fleet – United States Department of State

[2] Benedict (IMO: 9293155)

In a separate but significant development, the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) announced a substantial civil settlement with Applied Materials Inc. (United States) and its Korean subsidiary, Applied Materials Korea Ltd.[3]

The enforcement action concerned exports of U.S.-origin semiconductor manufacturing equipment to a Chinese entity that had been added to the BIS Entity List in 2020. The settlement, valued at approximately USD 252 million, represents one of the highest penalties imposed by BIS to date.

BIS alleged that, following the listing of the Chinese entity, certain semiconductor equipment was shipped to the Korean affiliate for assembly and subsequently transferred onward to China without the required export license. The underlying transaction value was approximately USD 126 million, and the penalty imposed equalled twice that amount, the statutory maximum.

In addition to the monetary penalty, the settlement reportedly includes enhanced compliance obligations, including audits of the company’s export control program and periodic certifications to BIS.

[3] See, URL: https://www.bis.gov/press-release/applied-materials-pay-252-million-penalty-bis-illegally-exporting-semiconductor-manufacturing-equipment

These recent developments highlight three key trends:

• Heightened scrutiny of petroleum transport linked to Iran, including activity conducted outside U.S. territory, particularly India even when bought from local agents/ trading companies in India including in situations when the transaction was done in local India Rupee Currency.
• Aggressive enforcement of semiconductor-related export controls, especially in relation to China and other nations under the applicable regulations.
• Expanded expectations of compliance governance, including screening, audit, and certification obligations.

Indian companies, particularly those operating in shipping, energy trading, chemicals and petrochemicals, advanced manufacturing, or semiconductor-related supply chains, should reassess their sanctions and export control risk exposure.

Key compliance considerations include:

• Screening counterparties and vessels against sanctions lists;
• Conducting beneficial ownership and vessel-tracking due diligence;
• Reviewing routing structures and intermediary transactions;
• Strengthening export classification and licensing controls;
• Implementing escalation protocols for high-risk transactions; and
• Conducting periodic internal audits and compliance training.

Even in the absence of U.S. nexus, Indian entities may face secondary sanctions risks where transactions involve restricted sectors or designated parties.

Recent U.S. enforcement activity demonstrates sustained regulatory focus on both sanctions’ evasion and export control circumvention. The breadth of actions spanning maritime oil transport and advanced semiconductor equipment illustrates the expanding compliance expectations for global businesses.

For Indian companies engaged in cross-border trade, a proactive compliance framework is no longer optional. Effective screening, documentation, governance oversight, and escalation mechanisms are essential to mitigate potential exposure to U.S. sanctions and export controls.

A strategic and preventive compliance posture not only reduces enforcement risk but also preserves commercial credibility in global markets that are increasingly shaped by geopolitical regulation.

Economic Laws Practice (“ELP”) has been assessing sanctions laws and regulations in several jurisdictions and regularly advising clients of any potential exposure to such regulations on account of their potential business engagements. ELP also has a reach that extends to jurisdictions across the globe through its extensive network of foreign lawyers and consultants, who in turn work closely with regulators and government authorities in respective jurisdictions.

We trust you will find this an interesting read. For any queries or clarifications please write to us at insights@elp-in.com or write to our authors:
Sanjay Notani, Partner – Email – SanjayNotani@elp-in.com
Ambarish Sathianathan, Partner – Email– AmbarishSathianathan@elp-in.com
Harika Bakaraju, Associate Partner – Email-  HarikaBakaraju@elp-in.com
Kshitij Sehrawat, Associate – Email-  KshitijSehrawat@elp-in.com