Sanctions as Unfunded Mandates: The Infrastructure Gap in Targeted Asset Freezes
Abstract
Modern targeted sanctions achieve speed and breadth by prioritizing legal minimalism at the designation stage—relying on intelligence-based attribution rather than evidence-based adjudication—while exporting the resulting unfunded mandates of complexity, costs, and legal uncertainty to enforcement. This Article argues that this infrastructure gap is a structural feature of modern sanctions design, functioning as an unfunded mandate imposed on enforcing jurisdictions. Sanctioning states rely on enforcing jurisdictions to supply the legal and administrative financial infrastructure needed to convert designation into control.
The Article develops this argument through the seizure of the M/Y Alfa Nero, stranded in Antigua following the designation of its alleged beneficial owner as part of the post-Ukraine invasion Russia sanctions regime. Antigua enacted emergency legislation, litigated multiple cases, and absorbed years of administrative and custodial costs. The vessel sold for $40 million against a reported $120 million value, with the difference representing deadweight loss absorbed by the enforcing jurisdiction, third parties, and the asset itself. Generalizing from this case, the Article shows that small states systematically function as shock absorbers for sanctions enforcement, supplying unfunded infrastructure under treaty compulsion and reputational coercion while lacking voice in sanctions design. Assessing sanctions requires transparency about enforcement costs, not just assets frozen.
Read the full piece at SSRN.