Implementation Day, which is 16th January 2016, marks the day on which it was verified that Iran implemented its nuclear-related commitments of the JCPOA. The Club and International Group are examining what this actually means in reality for Iran’s oil, gas, shipping, petrochemicals, insurance and financial sectors, and importantly for those owners/operators wishing to engage business with Iran.
The Club has published Circular 18/15 in common with all Clubs in the International Group: http://www.ukpandi.com/publications/article/circular-18-15-lifting-of-certain-sanctions-under-the-joint-comprehensive-plan-of-action-jcpoa-134371/
For more detailed advice see the paragraphs below.
US Sanctions relief
The US Treasury has published an FAQ relating to the Lifting of Certain U.S. Sanctions Under the Joint Comprehensive Plan of Action (JCPOA) on Implementation Day: https://www.treasury.gov/resource-center/sanctions/Programs/Documents/jcpoa_faqs.pdf
Guidance from the US Treasury on the lifting of certain U.S Sanction is available to download here:https://www.treasury.gov/resource-center/sanctions/Programs/Documents/implement_guide_jcpoa.pdf
The US has broadly lifted “nuclear-related secondary sanctions” which had targeted non-US companies/persons dealing with Iran’s energy, shipping, financial, shipbuilding and automotive sectors, Iran's port operators, providers of related insurance, Iran's trade in gold and other precious metals, and trade with Iran in graphite and raw or semi-finished metals, such as aluminum, steel and coal.
EU Sanctions relief
Full guidance on the termination or suspension of nuclear related financial and economic sanctions by the EU under the JCPoA is available on the UK Government Website here. Brussels has published a Note on the EU sanctions to be lifted following implementation day: http://eeas.europa.eu/top_stories/pdf/iran_implementation/information
However, not all of the EU and US sanctions against Iran are being lifted. There are still residual asset freezes in place against individuals and entities linked to Iran’s ballistic missile program and human rights violations. In fact, despite the announcement over the weekend the US has imposed fresh sanctions on Iranian companies and individuals over a recent ballistic missile test. The new sanctions prevent 11 entities and individuals linked to the missile programme from using the US banking system. Furthermore, the US “primary” sanctions will continue to prohibit US persons in general from carrying out business with Iran outside the few exempted areas such as food, medicine and the newly liberalised aviation sector. Banks are therefore likely to be weary in clearing US dollars transactions for Iran-related business for the foreseeable future.
Anyone proposing to engage in business in Iran will still be required to carry out proper due diligence on their counterparts before concluding contracts.
The following checklist, reproduced courtesy of Holman Fenwick Willan, identifies some of the issues that should be considered:
We will of course provide further details and guidance from the International Group once available.
For more information please contact Nigel Carden (firstname.lastname@example.org).