Published: Fri, May 18, 2018
Worldwide | By Lisa Hogan

European Union considers little-used statute to block United States sanctions over Iran

European Union considers little-used statute to block United States sanctions over Iran

The European Commission said Friday it is taking steps to shield EU companies doing business in Iran after the USA government abandoned an worldwide nuclear deal and warned that it could impose sanctions on companies trading with Tehran.

The EU wants to salvage the nuclear deal and its blocking statute is the most powerful tool at its immediate disposal, as it means EU companies won't have to comply with USA sanctions.

The statute prohibits European Union companies and courts from complying with specific foreign sanctions laws and says no foreign court judgments based on these laws have any effect in the EU.

To view the full article, register now. The aim is to have the measure in force before 6 August 2018, when the first batch of USA sanctions take effect.

The European Union is trying to find ways to keep Iran in the 2015 accord by safeguarding the economic benefits of the nuclear deal after US President Donald Trump abruptly pulled out of the deal.

The European Commission is also encouraging member-states to "explore the possibility of one-off bank transfers to the Central Bank of Iran".

The European Commission received the unanimous backing of EU heads of government to proceed with proposals made by commission president Jean-Claude Juncker and High Representative Federica Mogherini, which aim to protect European companies investing in Iran through action on four fronts.

The Commission also urged national governments to make one-off transfers to Iran's central bank to pay for oil before United States sanctions on transactions take effect.

"But we still think that, with the agreement, we would have better pre-conditions to speak with Iran about further agreements than by unilaterally cancelling an agreement that was unanimously approved and endorsed in the UN Security Council", she added.

Maersk, the world's biggest shipping container firm, the French oil giant Total and German-based insurance firm Allianz have already announced plans to withdraw from operations in Iran, to avoid new USA sanctions.

The Commission itself will maintain its cooperation with Iran.

"If they can not do that, we are ready to take our nuclear programme to a level stronger than before the JCPOA", Ali Akbar Salehi said. "We will have to see whether those remaining in the JCPOA can deliver those benefits to Iran", he said in the Belgian capital on Tuesday. It has also facilitated the ability of the European Investment Bank to support investment in small and medium-sized enterprises in Iran.

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