EU Court Limits Banks’ Ability to Refuse Accounts Based Only on U.S. Sanctions Lists

The Court of Justice of the European Union has ruled that inclusion on a U.S. sanctions list is not, on its own, sufficient reason for a bank in the European Union to refuse to open a basic bank account. The case began in Slovenia, where Nova Kreditna Banka Maribor, now acquired by OTP Group, refused in 2022 to open an account with basic features for a consumer identified only as LH. The bank’s refusal was based on the person’s inclusion on a sanctions list maintained by the U.S. Office of Foreign Assets Control, even though the consumer had not been convicted of the criminal offence that led to the listing and was not subject to sanctions imposed by the United Nations, the European Union, or Slovenia.

The ruling is important because basic bank accounts are treated differently from ordinary commercial banking products in the EU. Under EU rules, legal residents have a right to open and use a basic payment account, although that right remains subject to anti-money laundering and counter-terrorist financing requirements. These accounts are essential for everyday financial life, including receiving income, making payments, withdrawing cash, and participating in the formal economy. By confirming that a third-country sanctions listing cannot automatically block access, the court reinforced the idea that financial exclusion must be justified under EU law, not simply imported from another jurisdiction.

At the same time, the ruling does not tell banks to ignore U.S. sanctions. The court said that being listed by OFAC, or by another third-country sanctions authority, can still be considered as a relevant risk factor when banks assess money-laundering or terrorist-financing concerns. The distinction is narrow but powerful: a bank may examine the listing, assess the customer’s profile, and consider the legal and compliance risks, but it cannot treat the foreign listing as an automatic legal prohibition. In practice, this means banks need documented, individualized reasoning rather than blanket refusals.

For European banks, the decision creates a more complicated compliance environment. Many institutions operate globally, maintain U.S. dollar exposure, rely on correspondent banking relationships, or face potential U.S. enforcement risk if they deal with OFAC-listed parties. Because of this, banks often take a conservative approach and avoid clients who appear on U.S. sanctions lists, even when EU law does not impose the same restriction. The CJEU ruling pushes back against that tendency by reminding banks that risk management cannot override rights granted under EU law unless the refusal is properly grounded in EU anti-money laundering or counter-terrorism rules.

The broader message is about sovereignty in financial regulation. The EU is signaling that U.S. sanctions may influence risk assessment, but they do not automatically define legal access to basic banking inside the bloc. This matters beyond one Slovenian case because sanctions screening has become a central part of bank compliance, especially after years of geopolitical tension, Russia-related restrictions, and growing divergence between U.S., EU, and national sanctions regimes. The ruling may force banks to refine their onboarding policies, strengthen internal documentation, and separate legal prohibitions from broader reputational or commercial risk. For consumers and companies, it also offers a clearer path to challenge account refusals that rely too heavily on foreign sanctions lists without proper EU-law justification.