On August 29, 2014, the US Government imposed sanctions on persons involved in certain Iran-related activity.  Specifically, the US Treasury Department, Office of Foreign Assets Control (OFAC) imposed sanctions on eight individuals, fourteen entities, and six vessels, while the US Department of State sanctioned two entities. 

The measures demonstrate the US Government’s continuing commitment to enforcement of sanctions against Iran, even while limited sanctions relief remains in effect.

Background

The United States maintains various types of sanctions regimes that target Iran:

  • “primary” sanctions, applicable to US persons and subsidiaries of US companies, that restrict most trade with Iran
  • “secondary” sanctions that seek to curb non-US persons’ involvement in certain types of business related to Iran, such as support for Iran’s energy, shipping, and shipbuilding sectors, which we have previously summarized in part
  • targeted sanctions that focus on specific individuals and entities involved in certain illicit activity, such as support for terrorism, weapons proliferation, and human rights abuses

As we have previously advised, in January 2014 the United States and the European Union relaxed certain sanctions against Iran pursuant to the Joint Plan of Action (JPOA) agreement between Iran and the “P5+1” states consisting of the United States, the United Kingdom, France, Russia, China, and Germany.  This sanctions relief was extended on July 20, 2014, and will remain in effect through November 24, 2014 unless extended, as we have previously advised.

OFAC Designations

As detailed in a press release, on August 29, 2014 OFAC imposed sanctions on individuals, entities, and vessels involved in the following activities:

All of the sanctioned persons have been designated under OFAC’s List of Specially Designated Nationals (SDNs).  Consequently, their property is “blocked,” meaning that their property in the United States or in the possession or control of US persons are frozen, and all US persons worldwide are cut off from dealings with them.  Furthermore, the property of any entity owned 50 percent or more by these SDNs, or by any combination of SDNs in the aggregate, is also blocked.

The designations under EO 13622 and IFCA/EO 13645, which provide for “secondary” sanctions, are particularly notable:

  • Under EO 13622, OFAC sanctioned the Russia-based, Iranian-owned Asia Bank (formerly doing business under the name Chemeximbank) for facilitating the delivery of approximately $13 million in US bank notes from Russia to the GOI. 
  • Under IFCA/EO 13645, OFAC sanctioned two UAE-based companies, Faylaca Petroleum and Lissome Marine Services LLC.  Faylaca Petroleum made payments on behalf of the National Iranian Oil Company, while Lissome Marine Services LLC provided support to the National Iranian Tanker Company by facilitating ship-to-ship transfers of crude oil.  OFAC also sanctioned three individuals—one Iranian, one Turkish, and one Swiss—involved in the activity.

State Department Sanctions

As detailed in a press release, on August 29, 2014 the US Department of State imposed secondary sanctions on two companies:

  • Goldentex FZE, based in the United Arab Emirates, which was sanctioned under IFCA/EO 13645 for providing support to the Iranian shipping sector
  • Dettin SpA, based in Italy, which was sanctioned under the Iran Sanctions Act for providing Iran’s petrochemical industry with goods and support whose value exceeded $250,000

The State Department press release did not specify the particular sanctionable activity or the types of sanctions imposed.  Presumably, the State Department imposed certain of the sanctions available under the Iran Sanctions Act, which include restrictions on access to US financing and trade.  See our previous advisory summarizing these sanctions. 

Conclusion

The OFAC and State Department actions demonstrate that the US Government remains serious about enforcing sanctions against Iran.  Companies should be aware that although the JPOA relaxed certain sanctions, most US sanctions against Iran remain in effect.  Both the OFAC and State Department press releases explicitly state that the US Government will continue to enforce existing restrictions while the JPOA is in effect.