On February 7, 2014, the US Treasury Department, Office of Foreign Assets Control (OFAC) issued General License D-1 under the Iranian Transactions and Sanctions Regulations (ITSR), 31 C.F.R. Part 560. The general license expands and supersedes General License D, which was issued last March and authorized the export to Iran of certain services, software, and hardware incident to the exchange of personal communications. The newest authorization further broadens the circumstances under which personal communications-related items may be exported to, transferred in, and imported from Iran.


Despite the imposition of comprehensive sanctions against Iran, one of the few areas in which OFAC has encouraged trade with Iran is personal communications tools. This position is consistent with the broader US government policy that seeks to foster freedom of expression in Iran. In 2010, in response to Iranian repression of dissidents following the 2009 presidential election, OFAC first issued a rule authorizing the export to Iran of services incident to personal, Internet-based communications, as well as free, publicly available software necessary to enable such services. See 31 C.F.R. § 560.540. 

As we previously reported, OFAC issued General License D in March 2013 to expand the prior authorization to cover certain fee-based services and software and common hardware products. In general, the items authorized for export by General License D had to be classified as EAR99 or ECCN 5D992.c (mass market encryption software), or specified in an Annex (including, for example, mobile phones and smartphones, SIM cards, modems, routers, satellite phones, laptops, tablets, and anti-virus software; and consumer-grade internet connectivity services).

General License D also authorized the export of consumer-grade internet connectivity services, and permitted US financial institutions to process transfers of funds from Iran in furtherance of authorized activities. Finally, General License D provided that OFAC may issue specific licenses on a case-by-case basis for the export and reexport of services, software, and hardware not authorized under the general license.

New General License D-1

OFAC’s new general license further expands the scope of authorized Iran-related trade transactions involving personal communications tools. The main changes include the following:

  • General License D-1 covers the “exportation, reexportation, or provision, directly or indirectly, to Iran” of certain personal communications software, hardware, and related services subject to the EAR – as opposed to just the exportation or reexportation from the United States or by a US person. The addition of the term “provision” could include, for example, an in-country transfer of covered software or hardware. The expanded language also now covers the activity of non-US persons located outside the United States. 
  • General License D-1 authorizes the exportation, reexportation, or provision – by a US person located outside the United States – to Iran of certain items not subject to the EAR. This includes foreign-made hardware or software not subject to the EAR because it contains less than a de minimis amount of US controlled content. The general license also authorizes shipments of publicly-available technology and software not subject to the EAR, when such shipments are made from the United States or by a US person. Items are eligible under these provisions if they would be classified as EAR99 or ECCN 5D992.C, or an ECCN specified in the Annex, if they were subject to the EAR.
  • General License D-1 authorizes an individual’s importation into the United States of certain hardware and software previously exported by that individual to Iran pursuant to this license or Section 560.540 of the ITSR. There is also a note to clarify that shipments of hardware and software to Iran may be made by individuals leaving the United States for Iran. Accordingly, General License D-1 permits an individual to carry a qualifying mobile phone or laptop while traveling to and from Iran.
  • General License D-1 permits the exportation or reexportation from the United States or by a US person to the Government of Iran of certain services and software publicly-available at no cost to the user. The category of services and software subject to this provision is narrower than the rest of the license, and excludes mobile phones, SIM cards, modems, satellite phones, laptops, and tablets. Also, in this provision only, the term “publicly available” refers “generally to software that is widely available to the public,” and is more narrow than that term is defined in the EAR.

The general license includes an Annex of qualifying products, which differs from the Annex to General License D only in minor respects. One change is that accessories to mobile phones and computers are now covered, as are applications (“apps”) designed to run on mobile operating systems, including apps downloaded from online app stores. Another change is to the type of SSL products covered by the authorization. 

OFAC also published a set of Frequently Asked Questions, which provide guidance on the scope and application of General License D-1. A few points are notable.

First, the general license covers services and software (EAR and ECCN 5D992.c) “incident to the exchange of personal communications over the Internet,” regardless of whether they are listed in the Annex. Other provisions – such as those related to hardware and certain items not subject to the EAR – only cover the products set forth in the Annex.

Second, to the extent that the general license authorizes US persons to export or reexport qualifying items, entities owned or controlled by US persons are authorized as well, subject to the conditions in Section 560.556 of the ITSR. 

Third, although computer accessories and peripherals specified in the Annex are authorized for export, a specific license would be required to export parts or components (including spare parts) of authorized hardware. An example of such a part or component would be a microprocessor.

Finally, the general license does not authorize transactions with blocked parties or activity that is otherwise prohibited by the EAR. Also, like past authorizations, it does not cover commercial-grade Internet connectivity services or telecommunications transmission facilities, or commercial web-hosting services.


General License D-1 represents a significant expansion of the previously existing authorization. It appears that OFAC is periodically fine-tuning these provisions to encourage their use. For example, OFAC stated that it is expanding the authorization to cover certain exports to the Government of Iran to “ensure that the sanctions on Iran do not have an unintended chilling effect on the willingness of companies to make available certain publicly available, no cost personal communications tools to persons in Iran.” OFAC may be concerned that many US exporters were not taking advantage of previous authorizations, potentially due to uncertainty regarding their scope or perceived risk from engaging in any transactions with Iran. OFAC has responded to this situation, for example, by authorizing certain transactions by non-US persons, trade in items not subject to the EAR, and a narrow class of exports to the Government of Iran. It seems that OFAC, as part of a broader US foreign policy, is continuing actively to use export and sanctions laws to promote the transfer of personal communications tools to Iran to foster free expression.