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Britain on Wednesday froze the assets of international neo-Nazi group Blood and Honour, the first use of the UK's counter-terrorism sanctions to target a far-right entity.

The finance ministry said it had "reasonable grounds" to suspect that Blood and Honour was "promoting and encouraging terrorism, seeking to recruit people for that purpose and making funds available" for terror activities.

Under the order, all assets and economic resources in the UK owned or controlled by Blood and Honour and its aliases, including the violent Combat 18 group, must now be frozen.

No person or entity in Britain is allowed to deal with any funds or economic resources belonging to the far-right entity or make funds, financial services or resources available to it unless they obtain a licence.

"The designation of Blood and Honour is a clear signal that the UK works proactively to stop terrorist financing and will take action against any who try to exploit the UK financial system for this activity," the ministry added.

The group emerged in England in 1987 from the skinhead music scene, according to The Counter Extremism Project (CEP), a non-profit policy organisation working to combat extremist ideologies.

Founded by Ian Stuart Donaldson, who died in a 1993 car crash, it has since spread across Europe, Russia, Australia, and North America, the CEP noted.

Right-wing extremist Anders Behring Breivik, who carried out Norway's deadliest peacetime attack when he killed 77 people in 2011, told a court there in 2022 he was merely a "foot soldier" for the Blood and Honour movement.

Canada designated it and its violent offshoot Combat 18 as terrorist groups in 2019, while several European countries have banned them.