What do U.S. sanctions on Iran restrict? They restrict many transactions involving Iran, Iranian persons or entities, blocked parties, and designated sectors—especially for U.S. persons. But they are not a single rule banning every interaction. Regulations, executive authorities, exemptions, and licenses work together, and a transaction’s parties, goods or services, destination, end use, and payment route can change the answer.
Some communications services and humanitarian activity may be authorized under defined conditions. That does not make all technology, food, medicine, or payments permitted. For a specific transaction, check the operative OFAC rules and current notices and consult qualified sanctions counsel.
How the restrictions fit together
The U.S. Iran sanctions program is layered. OFAC’s Iran sanctions materials point to the Iranian Transactions and Sanctions Regulations (ITSR), executive authorities, sector determinations, general licenses, specific licenses, and FAQs. Different measures can apply to the same transaction.
It helps to distinguish three kinds of risk:
- Transaction and export prohibitions: rules may prohibit exports, services, or other dealings involving Iran or Iranian persons unless an exemption or authorization applies.
- Blocking sanctions: property and interests in property of designated persons can be blocked, and U.S. persons generally may not deal with blocked parties unless authorized.
- Sectoral or secondary-sanctions exposure: some measures target activity in specified sectors or can expose non-U.S. persons to sanctions for certain conduct. A transaction that is not directly prohibited for one party may still create separate exposure.
There is no universal answer based only on a product category or the fact that a recipient is an ordinary person in Iran. The applicable authority and each transaction’s facts matter.
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Can U.S. companies provide technology or online services to people in Iran?
Some communications-related services, software, cloud services, and specified hardware may be authorized under 31 CFR 560.540. OFAC incorporated the earlier General License D-2 into that regulation in amendments effective May 17, 2024, with additional changes. The authorization is bounded by the regulation’s categories, criteria, and exceptions; it is not blanket permission to provide technology to Iran.
Online communications and software
OFAC describes covered services that include messaging, chat and email, social networking, photo and movie sharing, browsing, blogging, collaboration, video conferencing, e-gaming, e-learning, automated translation, web maps, user authentication, and related cloud services. The examples are not the only possible qualifying services: an unlisted service may qualify if it otherwise meets the regulation. Qualifying software must also satisfy the relevant export-control criteria.
Hardware and technical limits
The regulation includes certain communications hardware and peripherals. OFAC’s May 2024 update describes an “APP” threshold that excludes laptops, tablets, and personal computing devices above 1 Weighted TeraFLOP. Certain accessories and peripherals may qualify, but hardware parts or components generally are not authorized for export to Iran under this provision. These technical criteria do not establish that consumer electronics generally may be exported.
Government and blocked-party boundaries
OFAC FAQ 1087 says the cloud-services authorization in 31 CFR 560.540(a)(1) does not authorize cloud-based services or software to the Government of Iran, except as specified in paragraph (a)(6). The general licenses summarized in OFAC’s Iran FAQ materials also do not authorize exports to persons blocked under other OFAC authorities unless a separate authorization applies.
What due diligence applies to cloud providers?
A cloud provider outside Iran whose customer uses its services to offer software or services to people in Iran may rely on 31 CFR 560.540 only if it conducts due diligence based on information ordinarily available to it. OFAC says the provider should confirm that the customer is not a blocked person, except in the specified authorized case, and that the customer’s offering fits a category described in FAQ 1087, including activity otherwise authorized or exempt under the ITSR.
OFAC says it generally does not expect a provider that has completed this ordinary-course due diligence to evaluate the ultimate end use or end user. That statement is tied to the described circumstances; it is not a waiver of the regulation’s other requirements.
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Are food and medicine exempt from Iran sanctions?
Not categorically. OFAC provides licensing information for agricultural commodities, medicine, and medical devices, and publishes licenses covering particular humanitarian transactions. Those routes can permit defined activity, but the applicable license or exemption, its conditions, and the transaction’s counterparties still need to be checked.
Humanitarian purpose alone does not establish that every sale, service, export, bank, or payment is covered. Screen relevant parties and financial institutions and confirm that the exact goods and activities fit the applicable authorization.
Why can payments and financial services be restricted?
Payment routes can bring separate rules into play. OFAC identifies potentially sanctionable activity involving significant goods, services, hardware, software, upgrades, or financial services connected with Iran’s financial sector. Its examples include new hardware or software and upgrades or related services for Iranian financial institutions sanctioned under Executive Order 13902, as well as financial services for transactions other than permitted ones. OFAC also says it may issue additional guidance.
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General License L and blocked Iranian financial institutions
General License L covers certain transactions and activities involving Iranian financial institutions blocked under Executive Order 13902 when the underlying activity is authorized, exempt, or otherwise not prohibited under the ITSR. It is a limited connection between authorities, not a general permission to transact with Iranian banks.
Personal remittances
OFAC describes General License B as covering certain noncommercial personal remittances processed by U.S. depository institutions or registered securities brokers or dealers, subject to blocked-party and routing conditions, including processing through a third country. Do not treat that summary as operational payment instructions: verify the current regulation and FAQ, the exact parties, and the proposed route before sending funds.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.What changed in the OFAC materials in 2026?
As of October 4, 2026, OFAC’s Iran sanctions page listed General Licenses F and G as suspended effective August 24, 2026, and General License J-1 as suspended effective September 8, 2026. The page also listed sector determinations effective August 24, 2026 for aviation, digital assets, gold, shipping, and technology, and determinations effective October 1, 2026 for automotive and rail.
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Those listings are currentness markers, not a complete statement of each measure’s legal effect. Read the linked notices and operative regulations for the scope, covered conduct, and effective dates before relying on any authorization or assessing a transaction.
How to assess a specific transaction
Before treating a transaction as prohibited or authorized, establish the relevant facts and match them to the exact rule. A general license is public and self-executing when a transaction meets its stated conditions; it is not individualized approval. A specific license is issued by OFAC to a particular applicant.
- Identify every party. Determine who is a U.S. person, who is located in or connected with Iran, and whether any person or entity is blocked under an OFAC authority.
- Describe the activity precisely. Identify the good, service, software, technology, or financial service, and determine any applicable export-control classification.
- Check destination, end user, and end use. Establish whether Iran or the Government of Iran is involved and whether a special restriction applies.
- Trace the payment path. Identify the banks, financial institutions, intermediaries, currency, and route, then check for separate blocking or sector-related rules.
- Match the facts to an authority. Read the relevant regulation, exemption, general license, or specific license in full, including exclusions, conditions, effective dates, reporting, and recordkeeping requirements.
- Verify current status. Consult OFAC’s current Iran sanctions page and the underlying notices close to the transaction date. If the rule’s application remains unclear, seek qualified sanctions counsel or OFAC interpretive guidance.
The answer depends on the parties, item or service, activity, payment route, and date. A general overview cannot determine whether a proposed transaction is lawful.
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