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U.S. Lifts Nuclear-Related Sanctions Against Iran

Effective 16 January the United States has lifted its nuclear-related secondary sanctions against Iran following the United Nations’ determination that Iran has complied with specified commitments under the Joint Comprehensive Plan of Action aimed at reducing the country’s capability to produce nuclear weapons. However, the U.S. trade embargo against Iran remains in place and U.S. persons and entities are still prohibited from virtually all dealings with Iranian entities. In addition, the United States will continue to target sanctionable activities outside of the JCPOA, including those related to Iran’s support for terrorism, regional destabilisation, human rights abuses and ballistic missile development.

New General License H issued by the Treasury Department’s Office of Foreign Assets Control allows only non-U.S. subsidiaries of U.S. parent companies to engage in the following activities with respect to Iran without a licence.

  • Insurance – provide underwriting services, insurance or reinsurance for activities authorised by the JCPOA
  • Energy and petrochemicals – purchase, acquire, sell, transport or market petroleum, petroleum products or natural gas to or from Iran, including providing investment (including joint ventures), goods, services (including financial) and technology for use in the development of these sectors and associated services
  • Shipping, shipbuilding and ports – own, operate, control or insure a vessel used to transport crude oil or petroleum products, operate a port in Iran, engage in activities with or provide financial services and other goods in connection with the shipping, shipbuilding sectors and associated services
  • Gold and other precious metals – sell, supply, export or transfer gold and other precious metals, directly or indirectly, to or from Iran or conduct or facilitate financial transactions or provide services for the foregoing including security, insurance, and transportation and associated services
  • Software and metals – sell, supply or transfer, directly or indirectly, graphite, raw or semi-finished metals such as aluminium and steel, coal and software for integrating industrial processes to or from Iran and the sale or supply of such materials to the industries above and associated services
  • Automotive – sell, supply or transfer to Iran goods and services used in connection with the automotive sector in Iran, including associated services
  • Commercial aircraft – sell, export, re-export, lease or transfer commercial passenger aircraft and related parts and services (warranty, maintenance and repair) to Iran for civil aviation end-use and associated services
  • Financial and banking – engage in activities including financial and banking transactions with the government of Iran, the Central Bank of Iran, Iranian financial institutions and other Iranian persons, including the provision of loans, transfers, accounts (including the opening and maintenance of correspondence and payable through accounts at non-U.S. financial institutions), investments, securities, guarantees, foreign exchange, letters of credit and commodity futures or options, specialised messaging services and facilitation directly or indirectly for the government of Iran’s purchase of U.S. bank notes and the purchase, subscription to, or facilitation of the issuance of Iranian foreign debt

However, General License H carves out two exceptions to the prohibition on U.S. persons facilitating the above activities: (1) they may change their policies to allow for owned or controlled non-U.S. subsidiaries to engage in permissible transactions with Iran, and (2) they can allow non-U.S. subsidiaries access to automated or globally integrated business support systems such as telecommunications, email, accounting, etc. that utilises a U.S. server as long as no U.S. person performs any physical input, such as data entry.

In addition to issuing this general licence, OFAC has removed more than 400 individuals and entities from its List of Specially Designated Nationals and Blocked Persons, Foreign Sanctions Evaders List and/or Non-SDN Iran Sanctions Act List, as appropriate. As of 16 January non-U.S. persons are longer subject to sanctions for conducting transactions with any of these individuals and entities, including the Central Bank of Iran and the specified Iranian financial institutions, provided these transactions do not involve persons on the SDN List after that date or certain prohibited conduct.

OFAC has also issued a statement of licencing policy allowing for the case-by-case licencing of U.S. persons and entities to sell, export, re-export, lease or transfer commercial passenger aircraft and related parts and services (warranty, maintenance and repair) to Iran for exclusively civil aviation end-use. Finally, OFAC has issued a separate general licence that will allow U.S. imports of Iranian-origin carpets and foodstuffs, including pistachios and caviar.

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