In May, we published an e-bulletin discussing President Trump's announcement that the United States would withdraw from the Iran nuclear deal (the Joint Comprehensive Plan of Action – "JCPOA"), and that all pre-JCPOA nuclear-related sanctions on Iran (including secondary sanctions) would be re-imposed.
The European Union, along with leaders of the other countries party to the JCPOA (Germany, France, the United Kingdom, Russia and China) have all reiterated their commitment to the JCPOA. On 18 May, the European Commission announced in a press release that it had taken (or will continue to take) the following four steps to continue the full and effective implementation of the JCPOA:
- launched the formal process to activate Council Regulation (EC) No 2271/96 (the "Blocking Statute") by updating the list of US sanctions on Iran falling within its scope;
- launched the formal process to remove obstacles for the European Investment Bank to decide under the EU budget guarantee to finance activities outside the European Union, in Iran;
- continue and strengthen the ongoing sectoral cooperation with, and assistance to, Iran, as confidence building measures; and
- encourage Member States to explore the possibility of one-off bank transfers to the Central Bank of Iran.
On 6 June, the Commission published a delegated act amending the Annex to the Blocking Statute, which lists the extraterritorial laws to which the Statute applies, to include the proposed re-imposed sanctions against Iran (the "Delegated Act"). The Commission aims to have the amended Blocking Statute in force before 6 August 2018, when the first set of re-imposed US sanctions on Iran will take effect (although there is a two month period before the Delegated Act enters into force during which the European Parliament and the Council may make objections to the proposed updates).
In this briefing, we provide a summary of the provisions of the Blocking Statute, as well as a brief analysis of its enforcement and commentary on the potential conflicts which arise as a result of the proposed amendments.