Supply chains face scrutiny from regulators, sanctions' lawyer says

GLOBAL supply chains are increasingly facing scrutiny as regulators enforce sanctions’ regimes, a prominent lawyer says.

Sanctions lawyer for UK law firm Reed Smith, Alex Brandt, has discussed the year just gone and the situation facing the industry in 2026.

Mr Brandt said 2025 had been a high-risk year for shipping from a sanctions perspective, with a “step change” in approach from both European Union and the United Kingdom regarding measures and enforcement.

He said 2026 remained “mired in uncertainty”, particularly regarding the flow of Russian oil and liquefied natural gas.

“Sanctions have become one of the most defining forces shaping the global shipping industry in 2025,” Mr Brandt said.

“What began as targeted restrictions have evolved into a web of overlapping measures that touch every aspect of maritime trade — from vessel ownership and flagging to finance and insurance.”

For shipowners and charterers, the challenge wasn’t just knowing what was prohibited but anticipating what might become prohibited.

“The complexity and pace of change mean that compliance has continued to shift to a central part of commercial decision-making,” Mr Brandt said.

“We’ve seen regulators move beyond targeting states or cargoes to focus on the entire logistics chain — the vessels, operators, brokers, and those ancillary service providers that sit behind the movement of vessels and cargo.”

He said the expansion of ‘shadow fleet’ sanctions had put the industry under unprecedented scrutiny.

Every voyage now carried a compliance dimension and the operational cost of getting it wrong could be massive, not just in fines, but in reputational damage and loss of market access.

“Looking ahead to 2026, the only real certainty is unpredictability. Geopolitical volatility means new sanctions regimes could appear almost overnight, and enforcement is becoming more sophisticated,” Mr Brandt said.

“The shipping industry will need to stay agile, invest in data and due diligence tools, and view sanctions compliance as an essential part of responsible and resilient business practice.”