On 16 February 2026, HM Government (HMG) launched a call for evidence to seek industry views on the application of the ownership and control test in UK financial sanctions regulations, including how firms implement the regulations and where they face challenges.
Background
The two-condition ownership and control test works to ensure that entities owned or controlled by a designated person (DP) (i.e. a person or entity who is designated and recorded on the UK Sanctions List) are subject to financial sanctions, even if not listed. In particular, the second condition of that test, referred to as the ‘control test’ is broadly drafted to capture as much activity as possible.
As part of the Review of Sanctions Implementation and Enforcement, published in May 2025, HMG committed to provide further clarity on ownership and control to which the review highlighted the implementation challenges associated with the ‘control’ element of the test.
Overview
The scope of the call for evidence aims to gather evidence in three main areas:
- The prevalence and nature of ‘hypothetical control’ in financial sanctions casework including how frequently this form of control is encountered and its significance in the application of financial sanctions.
- The practical challenges and ease of implementation associated with the ‘control’ test, with a particular focus on the assessment of the ‘hypothetical’ element of the test and the financial impact of compliance and implementation.
- The practical utility of ‘control’ typologies as a tool to assist stakeholders with assessing the ‘hypothetical’ element of the control test which includes, in particular, the four categories of the typology or concept of control.
HMG explain in this call for evidence that it is seeking practical insights and evidence from stakeholders to ensure that any future policy development is grounded in the realities of implementation.
Next steps
HMG welcomes views in response to the questions posed in the call for evidence, inviting feedback until 13 April 2026.