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Home Posts tagged "Iran Nuclear Deal"

‘With Friends Like That, Who Needs Enemies?’: Extraterritorial Sanctions Following the United States’ Withdrawal from the Iran Nuclear Agreement

Published on May 29, 2018        Author: 

On Monday 21 May 2018, the US Secretary of State announced that, as a result of its withdrawal from the Joint Comprehensive Plan of Action (‘JCPOA’ or ‘Iran Nuclear Deal’), the United States is set to impose the ‘strongest sanctions in history’ against Iran. While the remaining states parties are committed to preserve the Iran Nuclear Deal, whether the JCPOA can in fact survive in the face of the US change of heart is a matter of uncertainty. Of particular concern is the effect that the resumption of US economic sanctions will have on non-US companies that have flocked to Iran in the aftermath of the JCPOA. Unlike the sanction programmes implemented against Iran by various states before 2015, the US measures present distinctively extraterritorial features, directly targeting foreign companies carrying out business with Iran despite the absence of a significant connection with the United States. The European Union has already vowed to take action in order to protect its trade interests and to ‘block’ unwarranted interference by the United States. As tension in the transatlantic relations mounts, serious questions arise concerning the legality of the US sanctions regime under international law. This post will focus in particular on the compatibility of these measures with the international rules governing the assertion of jurisdiction by states. It will be shown that, in the absence of an adequate jurisdictional basis, the extraterritorial aspects of the US sanctions regime must be considered unlawful. Some measures that the European Union and other JCPOA states can take in order to react to these wrongful acts will further be considered. Despite the availability of legal means to counter the US sanctions, a negotiated settlement between the United States and its economic partners remains the most viable solution to this standoff.

The long arm of the US sanction regime

Despite the Trump administration’s lack of specific directions on the issue, the US Treasury Department’s Office of Foreign Assets Control (OFAC) recommends that persons engaged in transactions with Iran:

‘should take the steps necessary to wind down those activities to avoid exposure to sanctions or an OFAC enforcement action under U.S. law after August 6, 2018, or November 4, 2018, depending on the activity’ (Question 1.4).

Of particular concern for foreign firms are the provisions contained in Executive Order 13590 (providing for an almost complete ban on the Iranian petrochemical sector), Executive Order 13622, and Executive Order 13645 (which prohibit foreign financial institutions from carrying out a vast set of transactions on behalf of Iranian entities). As recently as August 2017, Congress also vested the US President with ample powers to take measures against:

‘any person that … knowingly engages in any activity that materially contributes to the activities of the Government of Iran with respect to its ballistic missile program, or any other program in Iran for developing, deploying, or maintaining systems capable of delivering weapons of mass destruction’ (Section 104 of the Countering America’s Adversaries Through Sanctions Act).

Alongside their broad content, these measures all are characterised by an unspecified — and potentially unlimited — jurisdictional scope. Through these provisions, the United States seeks to compel not only US persons, but ‘any person’ — wherever located and regardless of their connection with the United States — to refrain from engaging in certain transactions with Iran. This is problematic in several respects. Read the rest of this entry…

Filed under: Iran, Nuclear Weapons, Sanctions
 

The Trump Presidency and the Iran Nuclear Deal: Initial Thoughts

Published on November 17, 2016        Author: 

Well it’s been a dramatic and, for many of us, soul searching week since last Tuesday’s presidential election in the U.S. resulting in Donald Trump being elected the next U.S. president. I’ll hold back on political editorializing in this space. We all have our views and there are other fora in which to express them.

Among the many issues that will be affected when Trump assumes the U.S. presidency in January is of course the Iran nuclear issue. Trump famously stated on the campaign trail: “My number one priority is to dismantle the disastrous deal with Iran.”  I don’t actually think this is his number one priority, but nevertheless a President Trump and his foreign policy team will most definitely not be the champions of the Joint Comprehensive Plan of Action (JCPOA) that President Obama and Secretary of State John Kerry have been.

Of course this all comes as a shock to most of us who work in the nuclear nonproliferation area. I genuinely thought that the JCPOA would, under a Hillary Clinton presidency, perhaps not be as positively supported by the U.S. administration as it had been, but that nevertheless the U.S. would seek to keep its commitments under the deal.  And as a side note, I also thought that this meant I probably wouldn’t be writing that much more about the JCPOA, and I welcomed that.

But now we are faced with a new reality and a lot of uncertainty about specifically how President Trump and his foreign policy team will treat the JCPOA, as well as whether Republicans in Congress will now – with Trump as president and willing to sign it into law – be successful in imposing new economic sanctions on Iran through statute.

I thought I would just offer a few initial observations and thoughts about the various questions that we now face relative to the JCPOA:

Read the rest of this entry…