On 25 July 2025, Cyprus enacted the Criminalisation of Violation of Restrictive Measures Law 2025 (the Cyprus Sanctions Criminal Law), marking a major development in the island’s sanctions enforcement and bringing Cyprus fully into line with EU sanctions compliance and restrictive measures best practices. The new law replaces the previous sanctions regime and sets out a clear, robust criminal framework for breaches of European Union (EU) restrictive measures and sanctions.
The official text (in Greek) is available here and an informal English translation is provided here.
A new chapter in EU-aligned enforcement
Until now, sanctions violations in Cyprus were governed by the Sanctions Law of 2016 (Law 58(I)/2016), which imposed criminal penalties for non-compliance with EU measures. However, that law lacked the breadth and clarity required to address the evolving nature of sanctions evasion and did not fully reflect the EU’s recent push for harmonised enforcement across member states.
The Cyprus Sanctions Criminal Law implements Directive (EU) 2024/1226 of 24 April 2024, which introduces minimum standards for defining and penalising breaches of EU restrictive measures across the Union.
Expanded reach and clearer obligations
The new law applies both within and beyond Cyprus’ borders, ensuring that violations with a Cyprus nexus are captured irrespective of where they occur. It extends to offences committed on Cypriot territory, offences committed abroad by Cypriot nationals or entities registered in Cyprus, conduct benefiting businesses operating in Cyprus, and acts committed on Cyprus-flagged ships or aircraft.
This extraterritorial reach ensures that businesses and individuals connected with Cyprus remain accountable, even when their operations span multiple jurisdictions.
Definition of criminal offences
The law sets out a detailed list of offences that constitute breaches of EU restrictive measures. These include making funds or economic resources available to designated individuals or entities, failing to freeze assets subject to EU sanctions, facilitating the travel of sanctioned persons within EU territory, concealing ownership of assets linked to sanctioned parties, engaging in transactions designed to circumvent restrictive measures, and conducting trade or financial dealings with designated persons in breach of EU rules.
By clearly identifying prohibited conduct, the Cyprus Sanctions Criminal Law removes ambiguity and provides both natural and legal persons with a transparent framework for compliance.
Graduated penalties for serious breaches
The new regime introduces severe penalties that reflect the seriousness of sanctions violations. Individuals found guilty of an offence may face fines of up to €100,000 and imprisonment for up to five years, depending on the gravity of the offence. Legal entities may be fined up to €40 million or 5 percent of their global turnover, whichever is higher. Additional sanctions include the revocation of operating licences, exclusion from public procurement or funding, and prohibitions from engaging in certain business activities.
Aggravated penalties apply where public officials or organised criminal groups are involved.
Humanitarian exemptions preserved
Consistent with EU principles, the law maintains a clear distinction between sanctions evasion and humanitarian activity. Conduct aimed at delivering humanitarian assistance or supporting basic human needs is expressly exempted from criminal liability, ensuring that legitimate aid operations remain protected.
Cross-border enforcement and EU cooperation
Recognising that sanctions violations often involve complex cross-border arrangements, the Cyprus Sanctions Criminal Law mandates active cooperation between Cypriot authorities and their European counterparts. The competent authorities must coordinate with enforcement bodies in other EU member states, as well as with Eurojust, Europol, and the European Public Prosecutor’s Office (EPPO), to ensure consistent application of sanctions rules and the effective prosecution of offences.
Implications for businesses and professionals in Cyprus
For companies operating in or through Cyprus – particularly in the financial services, shipping, technology and trade sectors – the new law significantly increases compliance obligations and regulatory risk. Businesses are expected to maintain robust internal controls, carry out regular sanctions compliance audits, and ensure that ownership structures and transactions are fully transparent. They must also have mechanisms to freeze and report funds or assets where required and conduct due diligence to verify the legitimacy of their counterparties.
Legal and compliance professionals in Cyprus should anticipate greater regulatory scrutiny and enhanced cooperation between Cypriot and EU enforcement authorities. The law reinforces the message that Cyprus is committed to ensuring that its sanctions enforcement regime meets the highest EU standards of transparency, accountability and deterrence.
Aleksei Andrievskii is the founder of the ANDRIEVSKII SEA WEALTH family office in Cyprus, a member of the advisory board at Bendura Bank AG, Liechtenstein