The Financial Action Task Force (“FATF”) has announced the continued suspension of countermeasures against Iran. FATF, the international standards setting body for anti-money laundering (“AML”) and combating the financing of terrorism (“CFT”), maintains a list of high-risk and non-cooperative jurisdictions that may be subject to calls for enhanced due diligence and countermeasures. Iran was previously subject to FATF calls for countermeasures, but the organization granted a temporary suspension in June of 2016 after Iran committed to implementing an action plan designed to address its AML/CTF deficiencies.

At its plenary meeting on June 23, FATF renewed its suspension, which had previously been granted for a 12 month period. While the suspension of countermeasures is highly significant for Iran, the country continues to be included on FATF’s so-called “blacklist” of high-risk and non-cooperative jurisdictions and remains subject to FATF’s call for enhanced due diligence.

FATF’s initial suspension of countermeasures came on the heels of the Iran nuclear deal (formally known as the Joint Comprehensive Plan of Action or JCPOA) and the sanctions relief incorporated in that agreement. Many observers expected that sanctions relief would generate significant interest by non-U.S. companies with regard to business opportunities in Iran (U.S. persons continue to be barred from most Iranian business opportunities). However, international business has been slow to return to Iran due to a variety of factors including concerns over remaining US sanctions, corruption risks, and money laundering. FATF’s continued suspension of its call for countermeasures is an important step in ameliorating some of the AML concerns regarding Iran, but many businesses likely will continue to view the country wearily until it is removed from FATF’s blacklist and FATF ends its call for enhanced due diligence. Such action likely will not occur until FATF determines that Iran has completed implementing its action plan. The FATF statement did not include any timetable for expected completion.