In this case sanctioned means approved instead of the second meaning of punished.
Definitions from Oxford Languages ·
sanc·tion
/ˈsaNG(k)SH(ə)n/
verb
past tense: sanctioned; past participle: sanctioned
-
- give official permission or approval for (an action).
“only two treatments have been sanctioned by the Food and Drug Administration”
-
- impose a sanction or penalty on.
“foreigners in France illegally should be sent home, their employers sanctioned and border controls tightened up”