On 8 May 2018, President Trump announced that the United States would withdraw from the Joint Comprehensive Plan of Action ("JCPOA"). In conjunction with that announcement, the President issued a National Security Presidential Memorandum ("NSPM") directing the re-imposition of certain secondary sanctions, being those that apply to non-US persons even where there is no US nexus. Depending on the economic sector targeted, the particular sanction will be imposed either 90 or 180 days after the President's announcement (6 August and 5 November, respectively).
Implementation of the first batch of sanctions is rapidly approaching. On 6 August, the United States will re-impose the following secondary sanctions that were lifted as part of the JCPOA:
- Sanctions on the purchase or acquisition of U.S. dollar banknotes by the Government of Iran;
- Sanctions on Iran's trade in gold or precious metals;
- Sanctions on the direct and indirect sale, supply, or transfer to or from Iran of graphite, raw or semi-finished metals such as aluminium and steel, and software for integrating industrial processes;
- Sanctions on significant transactions related to the purchase or sale of Iranian rials, or the maintenance of significant funds or accounts outside the territory of Iran denominated in Iranian rials;
- Sanctions on the purchase, subscription to, or facilitation of the issuance of sovereign debt; and
- Sanctions on Iran's automotive sector.
Note, however that the sanctions will also apply to the provision of associated services. By way of example, a person or entity providing indirect financing or transportation to Iran's automotive sector would also face potential exposure to secondary sanctions. Shipping companies, therefore, need to be mindful of these changes.
To the extent that you are a non-US person involved in activities falling into any of the above categories, you should urgently seek advice as to how the secondary sanctions may impact your business, as failure to wind-down any such activity by 6 August 2018 may be a breach of the secondary sanctions. To the extent you are an EU person, your position may be further complicated by the so-called EU "Blocking" Regulation, which is anticipated to take effect in early August in order to meet the 6 August 2018 deadline. Be sure you understand your obligations pursuant to this legislation, as well.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.