New US Sanctions Targeting Iran
On 10 January 2020, President Trump signed into effect a new executive order targeting Iran’s construction, mining, manufacturing and textiles sectors, on the basis that revenues derived by the Iranian Government from these sectors “…may be used to fund and support its nuclear programme, missile development, terrorism and terrorist proxy networks, and malign regional influence”.
Section 1 of the new EO authorises the imposition of an asset freeze against any person who is determined by the Secretary of the Treasury in consultation with the Secretary of State:
(i) to operate in the construction, mining, manufacturing, or textiles sectors of the Iranian economy, or any other sector of the Iranian economy as may be determined;
(ii) to have knowingly engaged, on or after the date of the EO, in a significant transaction for the sale, supply, or transfer to or from Iran of significant goods or services used in connection with a sector of the Iranian economy specified in, or as may be determined, pursuant to, subsection (a)(i) of Section 1;
(iii) to have materially assisted, sponsored, or provided financial, material, or technological support for, or goods or services to or in support of, any person whose property and interests in property are blocked pursuant to the EO; or
(iv) to be owned or controlled by, or to have acted or purported to act for or on behalf of, directly or indirectly, any person whose property and interests in property are blocked pursuant to the EO.
The prohibitions in Section 1 include:
(a) the making of any contribution or provision of funds, goods, or services by, to, or for the benefit of any person whose property and interests in property are blocked pursuant to the EO; and
(b) the receipt of any contribution or provision of funds, goods, or services from any such person.
The EO also includes the customary anti-circumvention provisions.
The effect of the EO will likely be to further reduce trade involving Iran, limiting trade to mainly that involving humanitarian and food cargoes, and supply of medicine / medical items.
Also on 10 January 2020, OFAC announced the designation of a number of companies, individuals and one vessel under Executive Order 13871 which came into effect on 8 May 2019 and targets Iran’s trade in steel and aluminium: https://www.steamshipmutual.com/liabilities-and-claims/sanctions/iran/new-us-executive-order-iron-steel-aluminium-copper052019.htm
OFAC has published a press release explaining the background to these designations: https://home.treasury.gov/news/press-releases/sm870
