On 8 May 2018, President Trump pulled the plug on the Iran Deal (JCPOA)1, announcing severe economic sanctions. President Trump’s decision does not directly affect the largely suspended EU sanctions against Iran. Various EU Member States have denounced his decision. The original US sanctions for the JCPOA may be divided into primary and secondary sanctions.
PRIMARY SANCTIONS PROHIBIT:
• US companies and individuals from developing activities in Iran;
• Any involvement of the US financial system and the US territory in Iranian activities; and
• The (direct or indirect) exporting of goods of US origin to Iran.
These are sanctions that are intended to prevent non-US companies and individuals from becoming involved with any individuals, entities or activities that are subject to US sanctions. These acts fall outside US jurisdiction. Nevertheless, non-US companies and their directors run the risk of becoming subject to restrictions on the development of activities in the US if they fail to comply with these sanctions. In the past, substantial penalties have been imposed on non-US companies for violation of the sanction regulations.2 The JCPOA had largely suspended the abovementioned US secondary sanctions. The primary sanctions had been upheld for the most part.3 The decision to pull out of the Iran deal has revived all the suspended sanctions.
On 6 August 2018, after a transitional period, the sanctions relating to, among other things, the following will be revived: • The purchase or acquisition of US dollar notes by the Iranian government; • The trade by Iran in gold or precious metals; • The direct or indirect trade with Iran in graphite, various metals and certain software; • Significant transactions in the Iranian Rial; • The Iranian automotive sector; • The trade in Iranian carpets and food products; and • Activities under certain granted licences.4 On 4 November 2018, after a transitional period, the sanctions relating to, among other things, the following will be revived: • Iranian ports and shipping and shipbuilding industries; • Petroleum-related transactions involving Iran; • Transactions by foreign financial institutions with the Iranian Central Bank; • Insurance and reinsurance; and • The Iranian energy sector.5