A transaction connected with a sanctioned country, blocked person, or restricted property is not always prohibited under every circumstance. Some activities are authorized by an exemption or a general license. Others require a specific license issued to the applicant by the Office of Foreign Assets Control.

The challenge is determining which category applies before the transaction occurs. A business should not assume that an important commercial purpose, humanitarian element, or prior banking relationship creates permission that does not appear in the governing sanctions rules.

General and specific licenses serve different purposes

A general license authorizes a defined category of transactions for everyone who satisfies its terms. It is self-executing, which means an eligible person generally does not apply to OFAC for individual approval. Conditions, reporting duties, deadlines, and exclusions must still be followed precisely.

A specific license is written authorization issued to a particular applicant for a transaction or series of transactions that would otherwise be prohibited. OFAC reviews these applications individually. The existence of a licensing process does not mean approval is automatic.

Before seeking legal help with an OFAC license application, the applicant should first examine whether the activity is already authorized or exempt. OFAC generally does not issue a specific license where an applicable general license already permits the transaction.

When a specific license may be relevant

Licensing questions can arise when a person seeks to release blocked funds, complete a restricted payment, provide services involving a sanctioned party, deal with blocked property, or wind down an activity that cannot lawfully proceed without authorization.

The applicable policy depends on the sanctions program. Permission available under one program may not exist under another. Rules can also distinguish between exports, financial services, legal services, personal transactions, humanitarian activities, and dealings involving blocked entities.

The application should identify the exact prohibition and explain why the proposed activity requires authorization. A vague request for permission to “do business” is less useful than a defined transaction with identified parties, amounts, dates, and responsibilities.

What an application should explain

OFAC may need enough information to understand the complete transaction and assess the sanctions risk. Depending on the matter, an application can include:

• The names, addresses, nationalities, and roles of all parties;
• Corporate ownership and control information;
• The amount, currency, banks, and payment route;
• Contracts, invoices, court documents, or account records;
• The purpose of the transaction and requested authorization;
• An explanation of any blocked or rejected payment.

Supporting documents should be consistent with the written account. Missing intermediaries, unexplained ownership, or conflicting transaction amounts can delay review and lead to follow-up questions.

Submitting an application does not authorize the transaction

A pending application is not permission to proceed. Unless a general license or exemption independently applies, the restricted activity should not occur before OFAC grants the requested authorization.

OFAC may request additional information or consult other government agencies. Review times differ according to complexity, sanctions policy, documentation, and workload. The applicant should retain the case information and respond carefully to follow-up requests.

Legal guidance on U.S. sanctions restrictions may also be necessary when the licensing question overlaps with compliance, entity ownership, blocked accounts, investigations, or transactions involving several countries.

What happens after approval or denial

A specific license authorizes only what its text permits. The licensee must review the parties, amounts, time limits, reporting conditions, and other restrictions before relying on it. A bank or business partner may request a copy and supporting information before processing the transaction.

If OFAC denies the application, the applicant should examine the stated basis, determine whether the facts or policy have changed, and consider whether additional information supports a renewed request. Repeatedly submitting the same incomplete package is unlikely to resolve the issue.

A licensing strategy begins with classification, not paperwork. The key questions are whether the activity is prohibited, whether an exemption or general authorization applies, and whether the specific request can be supported by a complete and accurate evidentiary record.