US President Donald Trump signed a decree that renews sanctions against Iran to the “highest level” after announcing that the US would leave the nuclear agreement with Iran signed by the Obama administration in 2015. In his announcement, Trump promised to create “bigger problems than ever before” for Iran when it develops nuclear weapons. But what are the sanctions and how do they affect other countries?
According to a statement issued on Tuesday by the U.S. Treasury Department, after a 90-day mining period Iran will be barred from buying or otherwise acquiring U.S. dollars and trading in gold and other precious metals such as graphite, coal, aluminum and steel. “Significant” transactions in Iranian rials and accounts outside Iran denominated in rials, as well as the purchase or subscription of Iranian national debt, are again subject to sanctions.
The US will also ban imports of Iranian carpets, food and certain related financial transactions and revoke special licences for the sale of commercial aircraft and related parts and services. Sanctions previously imposed on the Iranian automotive sector will also be imposed anew, the Ministry of Finance said, without specifying the details. All these sanctions will enter into force on 6 August 2018.
After a six-month liquidation phase, the US will again impose sanctions against Iranian port operations, shipping and shipbuilding. The Islamic Republic of Iran Shipping Lines (IRISL), South Shipping Line Iran and its subsidiaries were expressly mentioned in the Treasury document. The purchase of oil, petroleum products or petrochemical products from Iran will also be banned again and the companies concerned have been designated as National Iranian Oil Company (NIOC), Naftiran Intertrade Company (NICO) and National Iranian Tanker Company (NITC).
Iran’s oil exports had accelerated in April when Tehran tried to maximize revenues before Trump’s upcoming decision.
Sanctions against the Iranian Central Bank and the Iranian financial institutions designated under § 1245 of the National Defense Authorization Act (NDAA) for 2012 will also return by 4 November 2018. These include sanctions for the provision of “specialised financial intelligence services” to the central bank and other financial institutions and the provision of “underwriting services, insurance or reinsurance”.
The authorization for US-owned or US-controlled foreign companies to do business with the Iranian government or under Iranian jurisdiction, which was previously permitted under the provisions of the JCPOA, will be revoked with effect from November 5, 2018.
The U.S. government will “if necessary, reimpose” sanctions against persons removed from the Specially Designated Nationals and Blocked Persons (SDN) list and other lists maintained by the U.S. government on January 16, 2016.
European countries will have 90 to 180 days to abandon their operations in Iran, or they will “risk serious consequences,” according to a White House statement adding that all nations must “work together to stop the Iranian regime’s destabilizing quest for regional hegemony” for aligning themselves to the interests of Israel and the US.
Many US sanctions against Iran are already in place and have not been affected by the 2015 agreement. Under these sanctions, much of the direct trade between the US and Iran is already banned. The White House said it believes that the reintroduction of sanctions will put pressure also on European Countries to force Tehran “to change its course of malicious activity”.