What are common sanctions risk controls for shipping companies?

• A. Counterparty screening, route screening, sanctions screening of cargo and ports, compliance with OFAC/EU/UN, license management, and ongoing monitoring.
• B. Only check shipments from a select few guaranteed customers.
• C. Do nothing about sanctions.
• D. Depend solely on insurance to cover sanctions risk.

Answer: (A)

Sanctions risk controls in shipping are a structured, proactive way to prevent trade that could violate international sanctions. The core idea is to screen every part of the transaction and voyage—who you’re dealing with, the routes you take, and the goods and ports involved—against current sanctions rules.

Counterparty screening involves checking customers, brokers, and agents against sanctions lists to avoid doing business with restricted entities or individuals. Route screening looks at the planned voyage to ensure it doesn’t pass through or transship to restricted destinations or regions. Sanctions screening of cargo and ports verifies that the goods themselves aren’t restricted and that the ports or intermediary hubs you use aren’t involved in prohibited activities.

Compliance with major regimes (such as OFAC, the EU, and the UN) ensures your company’s policies align with prevailing laws, including proper documentation and record-keeping. License management is the process of obtaining, tracking, and applying for any licenses required to ship certain goods to specific destinations, or to particular end-users, and keeping licenses current. Ongoing monitoring means continuously re-screening counterparties, routes, cargo, and licenses as sanctions lists and rules change, so you don’t miss new restrictions.

This combination is the best approach because sanctions regimes are dynamic; relying on a narrow check or on insurance alone does not prevent violations, and doing nothing is not acceptable. A comprehensive, risk-based program helps protect the company from penalties, detentions, and reputational harm while keeping legitimate trade moving.