Strict liability definition

Strict liability

Civil liability that does not depend on knowing or having reason to know a transaction was prohibited. OFAC applies it, and the UK's OFSI has since 15 June 2022.

also known as

strict civil liability

reviewed

2026-10-02

Cite this page

APA 7

Sanctions Evasion Reference. (2026, October 2). Strict liability. https://sanctionsevasion.org/reference/glossary/strict-liability/

Chicago

Sanctions Evasion Reference. “Strict liability.” Last reviewed October 2, 2026. https://sanctionsevasion.org/reference/glossary/strict-liability/.

BibTeX

@misc{ser-reference-glossary-strict-liability,
  author = {{Sanctions Evasion Reference}},
  title  = {Strict liability},
  year   = {2026},
  note   = {Last reviewed 2026-10-02},
  url    = {https://sanctionsevasion.org/reference/glossary/strict-liability/}
}

The date is when this page was last reviewed, not when it was first published.

For OFAC, a person subject to US jurisdiction “may be held civilly liable even if such person did not know or have reason to know that it was engaging in a transaction that was prohibited”, as the 2024 Tri-Seal Compliance Note puts it. Knowledge still matters, but as a factor in the penalty, not as a condition of the violation.

In the UK the Economic Crime (Transparency and Enforcement) Act 2022 amended the Policing and Crime Act 2017 on 15 March 2022, and for breaches on or after 15 June 2022 OFSI no longer has to show the person knew or had reasonable cause to suspect a breach. The knowledge then counts only as a case factor. The Apple Distribution International case turns on it: a payment processed on the day a designation was published was a breach, and OFSI treated the timing as mitigation rather than as a defence.

Where this term is used

What is ownership threshold structuring? — Arranging shareholdings so that designated parties own less than the percentage at which ownership is automatically attributed, while control of the entity stays where it was.
How do gaps in acquisition integration create sanctions exposure? — A company buys a foreign business and keeps running its systems separately, so the acquired unit's transactions never pass through the parent's sanctions screening until someone thinks to connect them.
What happens when sanctions-screening controls go untested? — A firm builds real geo-blocking or screening controls, then never independently tests whether they still work, so a bug, a disabled setting or a discontinued tool runs unnoticed for months or years.

Related terms

Egregious case — OFAC's label for a particularly serious violation calling for a strong enforcement response, which sets a much higher starting penalty than a non-egregious case.
Voluntary self-disclosure — A self-initiated notification to OFAC of an apparent violation, made before or at the same time as OFAC or another authority discovers it, which lowers the base penalty.
Screening — Automated comparison of names, identifiers and other transaction data against sanctions lists and internal watchlists, at onboarding and on each payment.

Sources

Tri-Seal Compliance Note: Obligations of foreign-based persons to comply with U.S. sanctions and export control laws. U.S. Departments of Commerce, the Treasury (OFAC) and Justice, 2024. Applicability of U.S. Sanctions and Export Control Laws to Foreign-Based Persons; OFAC Enforcement Actions Against Foreign Persons; 6 March 2024.

Financial sanctions enforcement and monetary penalties guidance. HM Treasury, Office of Financial Sanctions Implementation, 2024. Section 146 of the Policing and Crime Act 2017 as amended.

Policing and Crime Act 2017, section 146. UK Parliament (legislation.gov.uk), 2017.