UK Russia Professional Services Sanctions: OTSI Guide for Accountants

Most accountants know the UK's financial sanctions regime, where the Office of Financial Sanctions Implementation (OFSI) enforces asset freezes against named individuals and entities. Fewer firms realise there is a second, separate regime: UK trade sanctions that prohibit certain professional and business services to anyone "connected with Russia", whether or not that person is on a sanctions list. This guide explains what those rules cover, who enforces them and what an accountancy firm should be checking. It draws on GOV.UK guidance and the Office of Trade Sanctions Implementation (OTSI) publications, and it is general information, not legal advice.

If you only screen clients against sanctions lists, you are covering one regime and potentially missing the other. Our guide to UK financial sanctions for accountants covers the OFSI side; this article covers the trade side.

What the services sanctions cover

According to the GOV.UK guidance on complying with professional and business services sanctions related to Russia, the UK has prohibited the provision of a defined list of services to persons connected with Russia. The prohibitions came in two stages:

Legal advisory services sit under a separate prohibition, which the GOV.UK guidance dates to 30 June 2023 and notes was amended on 6 September 2024. The same guidance says the general licence that previously applied to legal advisory services was revoked on 6 September 2024, and that records relating to legal advisory services must be kept for four years after the end of the calendar year concerned. If your firm also provides legal-adjacent services, read that section of the guidance directly.

The key point for accountants is that these are prohibitions on services. They apply even where the client is not designated and where no funds are frozen. A firm can therefore comply perfectly with financial sanctions screening and still breach the trade rules.

Who counts as a person connected with Russia

The GOV.UK guidance explains that a "person connected with Russia" is not limited to Russian nationals. As we read it, the definition includes:

• a company incorporated or constituted under Russian law, which the guidance says can include a Russian subsidiary of a UK company;
• a company domiciled in Russia; and
• an individual ordinarily resident in Russia or located in Russia.

The guidance also states that a branch of a UK company is generally treated as a UK person. Because the test turns on connection rather than nationality, an intake process that only records nationality or the client's registered office is unlikely to be enough. Check the current wording of the definition on GOV.UK before relying on this summary.

Exceptions and licences

The prohibitions are not absolute. The GOV.UK guidance describes exceptions, some of which apply automatically, and a licensing route through the Department for Business and Trade (DBT) and OTSI. It also describes specific exceptions for auditing. One exception relates to national security or the prevention or detection of serious crime, and the guidance says it requires a determination by a responsible officer. It also says that a firm relying on an exception must notify OTSI.

We have not reproduced the exact conditions here, because they are detailed and the guidance changes. If a client relationship might fit an exception, work from the current GOV.UK text, record your reasoning on file and take advice before you proceed. If no exception fits, the route is a licence application, not a judgement call.

Who enforces the rules and what the penalties are

OTSI investigates suspected breaches of the trade sanctions, and the GOV.UK guidance says breaches are reported to it through the "Report a Breach" route. Where goods or technology cross a border, cases go to HMRC instead. For accountants, the services regime means OTSI is the body to know.

OTSI's civil enforcement powers come from the Trade, Aircraft and Shipping Sanctions (Civil Enforcement) Regulations 2024, which took effect on 10 October 2024. The OTSI enforcement guidance says that:

• the maximum civil monetary penalty is £1 million or 50% of the estimated value of the breach, whichever is higher;
• liability is strict, so a firm can be penalised without intending to breach, and the civil standard of proof applies;
• OTSI can publicly disclose breaches; and
• there are reporting duties and information requests, and failing to comply with an information request can itself be a criminal offence.

The powers are not retrospective, so conduct before 10 October 2024 is outside them.

What the enforcement data shows

The OTSI Annual Review 2025-26, published on 27 August 2026, gives a picture of activity so far. OTSI reported receiving 178 reports of suspected breaches, of which 156 related to Russia. It closed 104 cases, of which 41 were found not to involve a breach and 40 were referred to HMRC. The review also reported that OTSI had not yet issued a civil monetary penalty, and that it received 51 licence applications, most of them relating to Russia. The review does not give an accounting-specific breakdown, so we cannot say how many of these cases involved accountancy firms.

The absence of penalties so far should not be read as comfort. The review shows a regulator receiving reports and closing cases, and the powers are new.

Practical steps for accountancy firms

These are our suggestions, not requirements in the guidance:

• Add a connection question to client intake. Record where each client, and each person instructing you, is incorporated, domiciled or ordinarily resident, not just their nationality.
• Cover services, not just names. Sanctions screening lists do not tell you whether a service is prohibited. Our sanctions screening guide shows how to build the list check; the services check is an additional step.
• Feed it into your risk assessment. Include trade sanctions exposure in your firm-wide risk assessment, so clients with Russian links are identified and considered together.
• Write down any exception you rely on. Note who decided, on what facts and whether OTSI was notified.
• Know your escalation route. Decide in advance who reports a suspected breach and how, so a discovery in the middle of an engagement does not stall.
• Re-check the guidance regularly. The GOV.UK page we reviewed showed a last-updated date of 10 October 2024, so confirm the current version before acting.

Frequently asked questions

Does the ban apply to a client who is not on any sanctions list?

Yes. The services prohibitions turn on whether the recipient is connected with Russia, not on whether they are designated.

Does it matter if the client is a Russian national living in the UK?

The definition in the GOV.UK guidance focuses on incorporation, domicile and where an individual is ordinarily resident or located, rather than nationality. Check the exact wording for your facts and take advice if it is borderline.

Is this the same as the OFSI regime?

No. OFSI enforces financial sanctions such as asset freezes. OTSI enforces trade sanctions, including the professional and business services restrictions. A firm needs to comply with both.

Can OTSI fine a firm that did not know it was breaching the rules?

The OTSI enforcement guidance describes the civil regime as strict liability, so lack of intent is not a defence to a civil penalty.

Sanctions compliance is part of wider anti-money laundering and financial crime competence. To see how it fits alongside customer due diligence and supervision, start from our AML and KYC guides hub.