The UK Foreign & Commonwealth Office recently hosted a panel discussion with UK business leaders to clarify UK trade policy on Iran following the lifting of sanctions. The principal points of note for those interested in investing in the country or doing business with Iranian counterparts are as follows:

HM Government supports the restoration of trade links with Iran and recognises the commitments already made by Iran to meet the requirements for JCPOA Implementation Day (reached on 16 January 2016). The UK has appointed Norman Lamont as its trade envoy for Iran.  UK Trade & Investment now have a representative based in Tehran to support UK companies doing business in Iran and have recently updated their guidance. UK Export Finance has reintroduced cover for UK companies exporting to Iran. Cover will be made available on a case-by-case basis and UKEF are liaising with the Export Guarantee Fund of Iran. UK Export Control aims to issue clear and accurate advice to UK businesses seeking to invest in Iran, providing guidance as to activities that are permitted, prohibited or subject to licence. The FCO continues to take steps to upgrade the services provided by the UK Embassy in Tehran and hopes reciprocal measures will be taken by the Foreign Ministry in Tehran. HM Government recognises that the continuing US Primary Sanctions (prohibiting US persons/companies from engaging in business with Iran) are seen to be problematic for many UK entities, especially banks, who fear financial penalties. The Government is encouraging OFAC to be as clear as possible in their guidance on Iran. UK investors may seek to explore what financing channels may be available to ring-fenced UK entities, perhaps more readily available from Asian financial institutions.

Despite the generally positive tone, UK businesses must be wary of political involvement in key industrial sectors as well as in major projects. Any investors should be aware that the legal and administrative environment in Iran often lacks clarity. Due diligence must be conducted on counterparts in Iran (given that a number of individuals and companies remain designated (sanctioned) entities. HM Government believes this, and any reputational risk, is navigable in most sectors, and is available to give guidance.