A multilateral sanction describes a Sanction issued collectively by multiple countries or international organizations acting together to achieve a common foreign policy, national security or human rights objective. These sanctions are typically coordinated through bodies such as the European Union (EU), the United Nations (UN) or other coalitions of nations. When an organization like the EU or UN imposes a sanction, it is considered multilateral because it represents the combined action and agreement of its member states.

Multilateral sanctions can target individuals, entities, sectors or entire countries and may include asset freezes, travel bans, trade restrictions or arms embargoes. They are often viewed as more powerful and legitimate than unilateral sanctions because they demonstrate broad international consensus and reduce the risk of sanctions being undermined by alternative markets or political support.

In the context of Know Your Customer (KYC) and Anti-Money Laundering (AML) compliance, screening for exposure to multilateral sanctions is a critical part of Customer Due Diligence (CDD) and ongoing monitoring. Financial institutions and regulated entities must ensure they do not conduct business with sanctioned parties or risk severe regulatory penalties, reputational damage and legal consequences.