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Australia's autonomous sanctions regime has continued to evolve over the past 12 months. Driven by ongoing geopolitical tensions, increased global coordination and a commitment to strengthening compliance frameworks, 2025 has seen the introduction of several new measures including an expansion of targeted measures in Russia, North Korea and Iran.
These developments reflect Australia's deepening commitment to sanctions, including utilising its autonomous sanctions framework, as a foreign policy and national security tool, deployed in close coordination with the United States, United Kingdom, European Union and other key allies. For businesses operating internationally, sanctions compliance is no longer a peripheral operational consideration but a central governance obligation requiring robust systems, ongoing vigilance, and the flexibility to respond swiftly to legal change. Trade flows through the Asia Pacific region mean that Australian sanctions have salience across the region, even in jurisdictions where only UN sanctions are implemented.
This article outlines the key developments over the past 12 months and what may be expected in 2026.
Key updates in 2025
Australia continued to expand its sanctions footprint in 2025, particularly in response to the protracted conflicts in Ukraine and the situation in North Korea. The key sanctions developments in 2025 included:
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Export Sanctioned Goods In February 2025, the Australian Government announced the tightening of export controls in Russia by designating commercial drones and drone components (AHECC 8806 and 8807) as export sanctioned goods. The amendment prohibits the direct or indirect supply of such items to Russia or Russian‑occupied regions of Ukraine without a permit, reflecting their increasing use for Russia's military purposes. The Australian Sanctions Office has also warned of sophisticated evasion tactics including the use of intermediaries, transshipment hubs, falsified end user documentation and modular component purchases designed to obscure Russia-linked procurement. |
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Designated Persons – Shadow Fleet Australia joined partners in targeting Russia's so-called “shadow fleet” – a network of aging, uninsured or deceptively flagged tankers used to move Russian crude outside G7 price-cap rules. A notable development in late 2025 has been the surge of “shadow fleet” vessels operating in and around Southeast Asian waters. Singapore, as one of the world's busiest ports, has observed a growing presence of such tankers off its coast, and its Maritime and Port Authority has increased monitoring of ship-to-ship transfers in its jurisdiction. The expanding footprint of this shadow fleet in the APAC region poses safety and environmental risks, but also strategic challenges for sanctions enforcement. Australia has responded by sanctioning many of these vessels itself. In June 2025, Australia announced the designation of 60 vessels linked to Russia's shadow fleet, in September 2025 announced the imposition of targeted sanctions on a further 95 Russian shadow fleet vessels, and in December 2025 announced designations on a further 45 vessels linked to Russia's shadow fleet. These actions form part of a coordinated international effort to restrict a key source of revenue sustaining Russia's war economy. |
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Import Sanctioned Goods – Russian Origin Oil 2025 also saw a coordinated reduction of the G7‑led price cap on Russian crude and petroleum products, with Australia implementing the revised cap of USD 47.60 (down from USD 60). The change is intended to reduce revenue flowing to Russia by closing remaining loopholes in the oil supply chain, including practices associated with the shadow fleet. However, evidence emerging throughout 2025 highlighted a significant structural gap, being the large‑scale importation into Australia of petroleum products refined in third countries (primarily India, Turkey and Singapore), using Russian crude oil. Although such products are technically “substantially transformed”, concerns have been raised that Australia is indirectly contributing to Russian oil revenues, contrary to the intent of the sanctions regime. The Senate Foreign Affairs, Defence and Trade Committee examined this issue in February 2025, recommending measures to improve tracking and consider expanding autonomous sanctions to capture petroleum products derived from Russian crude. These concerns have intensified as international partners move further, with the EU banning such third‑country refined products from 21 January 2026, and the US having imposed comprehensive sanctions on Rosneft and Lukoil in October 2025. There is growing pressure for Australia to reassess its position should the current structure continue to undermine the effectiveness of the price cap. |
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Cyber sanctions In December 2021, Australia established a thematic autonomous sanctions framework in relation to significant cyber incidents. In November 2025, Australia announced that it had joined a trilateral sanctions action with the US and the UK against Russian cybercriminal infrastructure and imposed coordinated sanctions on “Media Land”, a Russia-based “bulletproof” hosting service facilitating ransomware attacks. This joint action demonstrated Australia's commitment to align with allies on emerging threats like cybercrime. |
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Magnitsky-style thematic sanctions The Australian government also announced the imposition of Magnitsky-style thematic sanctions in response to high-profile cyber-attacks (such as additional designations following the Medibank Private data breach on the Russian entity, ZServers, and five Russian cybercriminals who provided the network infrastructure and services used to host and release the data stolen from Medibank). These sanctions reflect the Albanese Government's commitment in the 2023-2030 Australian Cyber Security Strategy announced in 2023 which introduced a strategy intended to deter and respond to malicious cyber activity, including by using sanctions to hold cybercriminals to account. |
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Expanded North Korean Sanctions Australia also announced the imposition of sanctions targeting individuals and entities involved in state-sponsored cybercrime. Consistent with the UN Panel of Experts reporting on DPRK sanctions evasion, Australia imposed coordinated sanctions with the US and the UK targeting North Korean IT worker networks and associated facilitators operating abroad. These sanctions targeted individuals and entities engaged in cybercrime used to support and fund North Korea's unlawful weapons of mass destruction and ballistic missile programs. Australia has warned businesses and IT recruiters of deceptive practices such as the use of proxy accounts and false documentation. |
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Guidance Notes DFAT and the ASO continue to update and release guidance and advisory notes to assist individuals and businesses in understanding and mitigating sanctions risk. These notes address emerging trends including the diversion of drones and drone components, misuse of remittance accounts and cryptocurrency, and the illicit involvement of foreign IT workers. The ASO also released guidance targeting vulnerable sectors, including gold supply chains and dual use industrial goods, the maritime sector, and has also released an advisory note highlighting the increasing sophistication of sanctions-evasion techniques including the use of third-party intermediaries and transshipment hubs, emphasising the need for due diligence and enhanced screening measures. From an Asia-Pacific perspective, these issues are particularly salient with regional hubs in Singapore, Malaysia and Indonesia being identified in international reporting as transit points for “ship-to-ship” transfers undertaken by Russia's shadow fleet. |
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Enforcement and compliance After years of limited public action, regulators signalled a greater willingness to investigate and prosecute sanctions breaches. Enforcement activity began to materialise more visibly. In October 2025, the AFP charged a Sydney remittance business director with contravening sanctions laws by facilitating transfers to Iranian banks. This investigation was triggered by an ASO referral and led to the suspension of the business' registration. |
Developments in 2026 and beyond
As we move into 2026, we expect ongoing developments to the Australian sanctions landscape, including as follows:
Further coordinated measures
We expect to see further sanctions measures implemented in response to the situations in Ukraine, Afghanistan, Iran and North Korea, in line with the US, UK and EU. This continued coordination is likely to be seen in respect of Russia's war economy (including further designations of oil-shipping networks and evasion facilitators), emerging cyber threats including North Korea's increasing use of cybercrime to fund weapons development and supply chains linked to Iran's missile programs.
This trend was underscored by the Government's announcement on 4 December 2025 of additional support for Ukraine, including a $95 million military assistance package, a $50 million contribution to NATO's Prioritised Ukraine Requirements List, and $2 million to the Drone Capability Coalition. These contributions follow Australia's ongoing contribution to multinational efforts to train Ukrainian military personnel in the UK under Operation Kudu and bring total assistance to more than $1.7 billion, reinforcing Australia's status as the largest non-NATO contributor of military support.
This sustained commitment signals that sanctions, in conjunction with direct military aid, will continue to be used as complementary tools to constrain Russia's war economy and uphold the global rules-based order. As such, 2026 is likely to see additional designations targeting oil-shipping networks, evasion facilitators and shadow-fleet vessels, as well as measures aimed at closing remaining gaps in supply chains supporting Russia's military operations.
Regulatory expectations
Australian companies can expect to see regulators raise expectations around due diligence. Companies involved in exporting dual-use goods, high-risk technologies or industrial components can expect closer scrutiny of:
- end users and intermediary verification;
- dual-use exports and AHECC codes;
- contract-based mitigation (e.g. “no-Russia” contractual clauses);
- data driven screening systems particularly for financial institutions and governance frameworks.
- Corporate boards will be expected to treat sanctions risk as part of mainstream corporate governance.
Russian oil and substantially transformed products
Ongoing concerns about the importation of petroleum products refined from Russian crude in third countries, and the presence of Russia-origin oil across the Asia Pacific region, are likely to intensify in 2026. While Australia's direct imports of Russian energy products have fallen from $80 million to zero, indirect imports via refining hubs in India, Turkey and Singapore have raised questions about the long-term effectiveness of existing prohibitions.
As international partners move to close this loophole, including the EU's ban on third-country petroleum products derived from Russian crude commencing 21 January 2026, Australia may face pressure to more closely align with international partners and consider further regulatory intervention.
Afghanistan sanctions regime
In October 2025, DFAT closed a public consultation on proposed amendments to the Autonomous Sanctions Regulations 2011 to establish a dedicated autonomous sanctions regime for Afghanistan, Autonomous Sanctions Amendment (Afghanistan) Regulations 2025. The proposed changes would introduce new listing criteria specific to Afghanistan, including an arms embargo and prohibitions on the supply of arms-related material or services to designated individuals or entities, and enable targeted sanctions such as asset freezes and travel bans for persons responsible for serious human rights abuses, and the suppression of women and girls and minority groups. Should the regulations be introduced, Australian businesses operating globally will need to take account of these new compliance obligations.
Enforcement developments
Increased resourcing and rising international scrutiny on sanctions evasion networks point to heightened investigative activity. To that end, 2026 is likely to see additional investigations and prosecutions directed at sectors with recurring compliance weaknesses or heightened risks, particularly remittance providers, freight and logistics operators, and exporters of dual-use goods.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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