With wide-reaching consequences, Iranian sanctions impact on a number of industries. Caroline Dutot reviews the latest developments and their effects on financial service providers.
In recent years the most stringent sanctions measures put in place have been those applied to Iran. Iranian sanctions have had far reaching consequences, especially in the oil, gas and shipping industries. It has been said that the sanctions have cost Iran more than $160bn (£102bn) in oil revenue alone since 2012.
In July 2015 a landmark deal was reached between key world players and Iran, including the United States. It would see the lifting of Iranian sanctions, subject to compliance by Iran with specified measures to reduce its nuclear programme over a ten-year period. Iran stands to gain access to more than $100bn in assets frozen overseas, from the lifting of sanctions.
16 January 2016 was a key implementation date in the Iran sanctions deal and heralded the termination (in some cases only suspension) of EU nuclear related financial and economic sanctions.
Detailed guidance can be found on the Gov.UK website but the following are the key changes:
- 34 individuals and 298 entities are no longer subject to an asset freeze.
- The restrictions on financial transfers to and from non-listed Iranian entities have ended.
- The requirement to seek prior authorisation for, or give notification of, transfers of funds sent to or received from Iran, is no longer applicable.
- Banking activities (such as the establishment of new correspondent banking relationships with Iranian Banks and the opening of branches, subsidiaries or representative office of Iranian Banks) in EU states is now permitted.
- The provision of insurance and reinsurance to non-listed entities Iranian entities is permitted. As are, transactions in public or public-guaranteed bonds with Iranian non-listed entities.
The lifting of sanctions on Iran is not absolute and it would be wise for local financial services businesses to remain on alert in respect of future Iranian business and take advice, if there is any uncertainty.
Advocate Caroline Dutot is a specialist in sanctions matters, having authored the Jersey Financial Services Commission’s guidance on the subject. Advocate Dutot can be contacted by telephone on 01534 481809 or by email on cdutot@ardentchambers.com
