Sanctions screening for STS deals starts before the first email. Use the five checks below to keep risk low and decisions fast.
This is a practical guide, not legal advice. Always confirm with your compliance team and live regulations in your trading region.
1️⃣ Know every party in the deal
List every entity that touches the transfer. That includes both vessels and their registered and beneficial owners, managers, charterers, cargo owners, brokers, agents, terminal or lightering coordinators, the STS service provider, insurers, and any banks in the payment chain. Hidden links often appear in management companies or cargo traders.
- Vessel A and Vessel B with IMO and flag
- Registered owner, beneficial owner, and manager for each
- Charterer and cargo owner with addresses
- Agents, brokers, and STS provider names
- Banks that will touch funds
- Company name, registration number, country
- Shareholding or control if available
- Vessel certificates and last class status
- Emails and phone contacts for a quick audit trail
2️⃣ Screen names against sanctions lists
Run every party name and each vessel against official lists from your exposure regions. Common sets include United States, European Union, United Kingdom, and United Nations lists. If your banks or insurers require other lists, add them. Match by exact name, former names, and known aliases.
| Item | How to check | If you find a hit |
|---|---|---|
| Company or person | Search official lists and reliable screening tools. Include former names and addresses. | Confirm it is a true match, then escalate to compliance before any next step. |
| Vessel | Check IMO, former names, prior flags, and any sanctions advisories tied to the hull. | If listed or advised, stop and review with compliance and insurers. |
Keep screenshots or exports of each search with date and time. Save them to the deal folder so you can prove what you checked.
3️⃣ Verify vessel identity and recent behavior
Confirm you have the right hull and that recent movements look normal. Compare AIS trails, last ten port calls, and any STS history. Look for dark activity, long AIS gaps without a clear reason, frequent identity changes, or unusual course patterns near restricted areas.
- Multiple name or flag changes in a short time
- Unexplained AIS gaps near high risk waters
- STS events in areas known for illicit trades
- Mismatch between declared draft and cargo type
- Stable name and flag history
- Clear AIS with routine port calls
- Consistent class status and inspections
- STS events logged with proper paperwork
4️⃣ Trace the cargo and the route
Know what the product is, where it was loaded, and where it is going. Match bills of lading, certificates of origin, and any blend or rebrand details to the voyage plan. Check for transshipment points that are under restrictions or heavy advisories.
| Document | What to confirm | Action if unclear |
|---|---|---|
| Bill of lading | Consignor, consignee, load port, quantity | Ask for a corrected copy or a letter of explanation |
| Certificate of origin | Origin country matches declared route | Request proof of blend or rebrand if needed |
| STS plan and nav risk plan | Coordinates, time window, safety and pollution plan | Move location or postpone until approvals are clear |
Plot the last 90 days of movements for both vessels. Look for loops that do not match the declared trade.
5️⃣ Confirm insurance, class, and STS approvals
Check that both hulls have active P&I and H&M cover for the planned location and operation. Confirm class is in force with no overdue conditions. Ask the STS service provider for their approvals, equipment list, mooring plan, fenders, and launch support.
6️⃣ Map the money flow and price controls
List every bank and payment step. Confirm who pays whom and when. If your trade touches any price control rules or attestations, collect them in writing. Keep invoices, unit prices, and any freight or insurance adders in the file.
- Buyer bank and seller bank identified
- Intermediary banks listed if any
- Invoice and unit price confirmed
- Attestations collected if required
Enter the price and any cap to check the basic test.
Result: OK
7️⃣ Confirm STS location rules and permits
Check local rules for the coastal state or anchorage. Some areas require permits, notices, or specific providers. Review weather, daylight limits, traffic lanes, and any exclusion zones. If the site has a history of incidents, pick another location.
| Item | What to confirm | Go or hold |
|---|---|---|
| Local permits | Permit number and validity dates | Hold until permit is on file |
| Approved STS provider | Provider certificate and equipment list | Hold if provider is not approved |
| Weather and daylight | Safe window and fallback plan | Go only with clear window |
8️⃣ Add clear protections in the contract
Put the screening steps into the paperwork. Use charter party or letter of indemnity language that covers sanctions, KYC, accurate documents, right to cancel, and cost sharing if rules change. Keep the wording simple and easy to enforce.
- Sanctions compliance and KYC warranties
- Accurate cargo and origin documents
- Right to refuse unsafe site or unclear counterparties
- Cost split if approvals or permits change
- Watchlist search proofs with dates
- Insurance letters and class status
- STS plan and provider certificate
- Permit copies and contact list
9️⃣ Monitor live during the transfer
Watch AIS, record key VHF calls if local rules allow, and keep a short photo log. Note meeting time, start time, hose connection, first oil, meter readings, samples taken, and hose off time. Save time stamped proof in the deal folder.
- Vessels alongside at [hh:mm UTC]
- Hose connected at [hh:mm] and pressure test pass
- First oil at [hh:mm] with sampler and witness
- Hose off at [hh:mm] and spill check clear
- Photos uploaded to folder with dates
🔟 Close the file with a clean audit pack
When the transfer is complete, refresh the screenings, save final documents, and match payments to invoices. Archive the full set so you can answer questions later. A neat file can save weeks if someone asks for proof.
- Counterparty roster and contacts
- All watchlist proofs with dates
- AIS plots, port calls, and STS photos
- BoL, origin, samples, and meter slips
- P&I, H&M, class, permits, and provider docs
- Invoices, payments, and any attestations
Tick each box before you close the file.
- Current P&I letters for both vessels
- Class status and any conditions of class
- STS provider certificate and operating manual
- Local permits if required by coastal state
- Some insurers exclude certain trades or areas
- If the exclusion applies, do not proceed
- Keep written confirmations with dates
Quick STS risk score
Set each slider from 0 to 3. Higher is riskier. Use this for triage. It does not replace a full compliance review.
Score: 0 of 15 — Low
0 to 4 Low. 5 to 8 Medium. 9 to 15 High. Medium and High should pause for compliance review.
Save with the deal folder
- Entity roster with roles and contacts
- Watchlist search proofs with date and time
- AIS plots and last ten port calls for both vessels
- BoL, origin, and STS plan copies
- P&I, H&M, class, and STS provider approvals
These steps help you lower risk before, during, and after an STS deal. Keep the roster clear, check lists, confirm the hulls, trace the cargo, secure insurance and permits, and put your protections in the contract. Monitor the operation and finish with a clean audit pack. If anything looks unclear at any stage, pause and ask for proof. That habit protects your charter, your cover, and your reputation.
