On 18 October 2015, referred to as “Adoption Day”, the Joint Comprehensive Plan of Action nuclear deal (the “JCPOA”) between Iran, the EU and the P5+1 (see Issue 41 of the Sanctions Alert) was formally adopted. Iran’s parliament approved the deal on 13 October 2015. The following day, Iran’s Guardian Council ratified the bill after finding it to be compliant with both religious law and the constitution.

Adoption Day marked the point at which Iran must begin to meet commitments such as dismantling proliferationsensitive components of its nuclear facilities and reducing its uranium stockpiles, and the EU and US were obliged to publish relevant legislation and guidance. The next stage for the JCPOA is “Implementation Day”, on which, following verification from the International Atomic Energy Agency (the “IAEA”) that Iran has complied with its JCPOA obligations, the sanctions relief measures described in the JCPOA will take effect.

On Adoption Day, US President Barack Obama issued a memorandum to the relevant Cabinet secretaries directing them to take the necessary actions to implement the JCPOA, and the US Secretary of State John Kerry issued contingent waivers of certain secondary sanctions. Secretary Kerry called these actions “a critical first step in the process of ensuring that Iran’s nuclear program will be exclusively for peaceful purposes”.

In connection with the waivers, the US Treasury Department’s Office of Foreign Assets Control (“OFAC”) issued a set of answers to Frequently Asked Questions about Adoption Day. The new FAQs stress that no changes will take effect until Implementation Day and that US persons will be prohibited from most transactions with Iran even after Implementation Day. OFAC also promised to issue further guidance about sanctions changes before Implementation Day.

The EU introduced legislation setting out changes to the existing sanctions on Iran and identifying the individuals and entities for delisting. The effect of the legislation will be to lift all nuclear-related EU economic and financial sanctions, and allow certain nuclear-related exports subject to licensing, as specified in the JCPOA.

The EU measures are contained in Council Regulation (EU) 2015/1861, Council Decision (CFSP) 2015/1863 and Council Implementing Regulation (EU) 2015/1862. The EU High Representative Federica Mogherini and Iranian Foreign Minister Javad Zarif issued a joint statement explaining the Adoption Day process.

Foreign governments, companies and banks are already said to have been in talks with Iran ahead of Implementation Day, which is due to occur early next year. Japan and Iran are said to have reached an investment agreement due to come into force in 2016. This activity has led the US Government to issue a “demarche” reminding foreign governments that sanctions on Iran will remain in place until Implementation Day.