On May 8, 2018, President Trump withdrew the United States from the Joint Comprehensive Plan of Action (JCPOA), an agreement reached in July 2015 between Iran, the United States, the United Kingdom, France, China, Russia, and Germany in which Iran agreed to curtail its nuclear program in exchange for phased economic sanctions relief. A White House Fact Sheet indicated that Iran entered the JCPOA in bad faith, citing Iran’s destabilizing role in conflicts throughout the Middle East, continued development of its ballistic missiles, support for terrorist organizations, and human rights abuses. The JCPOA and the United Nations Security Council Resolution that endorsed the deal included mechanisms for implementing a sanctions “snapback” in the event of a JCPOA violation, but the Trump Administration elected to withdraw unilaterally from the JCPOA without relying on these procedures.
To implement the withdrawal, President Trump signed a National Security Presidential Memorandum (NPSM) directing the Secretary of the Treasury and Secretary of State to “immediately begin taking steps to reimpose all United States sanctions lifted or waived in connection with the JCPOA.” The NPSM called for all sanctions relief pursuant to the JCPOA to be rescinded within 180 days. The Department of the Treasury’s Office of Foreign Assets Control (OFAC) and Trump Administration officials have explained that primary and secondary sanctions will be reimposed after 90- or 180-day “wind-down” periods, depending on the business activity, and that failure to halt sanctioned activity by the end of the wind-down period would risk “severe consequences.”
On May 8, OFAC published a statement providing additional details regarding the reimposition of sanctions. OFAC also published new FAQs detailing subsequent expected changes to the Iran sanctions program pursuant to the president’s directive and the US withdrawal from the JCPOA.
The United States made several changes to the US Iran sanctions program pursuant to the JCPOA. Most US “secondary” sanctions on Iran – which impose restrictions on non-US persons for doing business in certain sectors of the Iranian economy, or with certain Iranian entities or individuals – were lifted or waived during the time of the US government’s participation in the JCPOA. In addition, several hundred Iranian companies, individuals and vessels were removed from the Specially Designated Nationals (SDN) List administered by OFAC. While most aspects of the comprehensive “embargo” on trade between the United States and Iran remained in effect during the JCPOA, the United States issued limited authorizations for US persons to conduct additional business with Iran for the import of certain foods and carpets from Iran and, in some circumstances, for the export of commercial passenger aircraft, parts and services to Iran. The US government also authorized non-US subsidiaries of US companies to conduct certain business with Iran under General License H issued by OFAC.
As a presidential candidate, President Trump took the position that the JCPOA represented a “bad deal” for the United States, and President Trump promised to renegotiate the deal if elected. In April and July 2017, pursuant to the Iran Nuclear Agreement Review Act of 2015 (INARA), the Trump Administration certified Iran’s continued compliance with the JCPOA. However, on October 13, 2017, President Trump announced a strategic review of the JCPOA, stating that he “cannot and will not” continue to make certifications under INARA. In January 2018, when the Trump Administration issued the periodic waivers of statutory sanctions required to provide JCPOA sanctions relief, President Trump declared that the US would not issue any additional periodic waivers unless the United States’ European allies negotiated a “supplemental agreement” that strengthened the JCPOA. On May 8, 2018, despite having “engaged extensively with our allies and partners around the world,” President Trump announced that the US would withdraw from the JCPOA.
Reimposition of Sanctions
President Trump’s NSPM indicates that “all” of the sanctions waived or lifted under the JCPOA will be reimposed. These changes most likely will be implemented through new Executive Orders (EOs) from the president; termination of the periodic statutory sanctions waivers that have been issued by the Secretary of State; and changes to licenses, licensing policy, and the SDN list that will be made by OFAC. While there are numerous questions still outstanding about how the new sanctions may be implemented on a practical level, it is clear that the greatest impact of the reimposition of the sanctions will be on non-US entities, including non-US entities owned or controlled by US persons.
Consistent with the approach that the US government has taken in several other sanctions programs, the Trump Administration softened the impact on businesses of “immediate” reimposition of sanctions by establishing a series of wind-down periods for different types of sanctionable conduct. In the post-announcement press briefing, State Department officials noted that the wind-down periods would “allow both US companies [and] foreign companies as well to end contracts, terminate business, get their money out of wherever the sanctions target is – in this case, Iran.” The stated goal of the wind-down periods is to reduce the impact of sanctions on business and avoid “unintended consequences on our allies and partners.”
The statement and the FAQs issued by OFAC on May 8 provide additional important details on the mechanics for reimposing sanctions, although a number of issues will require further clarification and detail.
Secondary Sanctions Subject to 90-day Wind-down Period
In FAQ 1.2, OFAC explained that a number of secondary sanctions will be reimposed after a 90-day wind-down period that ends on August 6, 2018. These sanctions apply to the pre-JCPOA sanctions that had been in place in the following business activities and sectors, as well as sanctions on “associated services” related to these activities and sectors:
- The purchase or acquisition of US dollar banknotes by the Government of Iran
- Iran’s trade in gold or precious metals
- The direct or indirect sale, supply, or transfer to or from Iran of graphite, raw, or semi-finished metals such as aluminum and steel, coal, and software for integrating industrial processes
- Significant transactions related to the purchase or sale of Iranian rials, or the maintenance of significant funds or accounts outside the territory of Iran denominated in the Iranian rial
- The purchase, subscription to, or facilitation of the issuance of Iranian sovereign debt
- Iran’s automotive sector
Although the administration has not provided more specific information regarding the sanctions that will be reimposed, some of the specific sanctions that appear most likely to be reimposed at the end of this 90-day wind-down period include:
- US banknote sanctions in EO 13622
- Gold and precious metals sanctions in EO 13622 and the Iran Freedom and Counter-Proliferation Act of 2012 as amended (IFCA)
- Graphite, raw, semi-finished metals, and industrial process software sanctions in IFCA
- Iranian rial sanctions in EO 13645
- Iranian sovereign debt sanctions in the Iran Threat Reduction and Syria Human Rights Act of 2012 as amended (TRA)
- Automotive sector sanctions in EO 13645
FAQ 1.2 indicates that business “undertaken pursuant to the US sanctions relief provided for in the JCPOA” that is related to activities and sectors specified in the FAQ should wind down prior to August 6, 2018.
Secondary Sanctions Subject to 180-Day Wind-down Period
In FAQ 1.3, OFAC indicated that other secondary sanctions will be imposed after a 180-day wind-down period prior to reimposing sanctions on the following entities, sectors, and activities, as well as sanctions on “associated services” related to these entities, sectors, and activities:
- Iran’s port operators, and shipping and shipbuilding sectors, including the Islamic Republic of Iran Shipping Lines (IRISL), South Shipping Line Iran, or their affiliates
- Petroleum-related transactions with, among others, the National Iranian Oil Company (NIOC), Naftiran Intertrade Company (NICO), and National Iranian Tanker Company (NITC), including the purchase of petroleum, petroleum products, or petrochemical products from Iran
- Transactions by foreign financial institutions with the Central Bank of Iran and designated Iranian financial institutions under section 1245 of the National Defense Authorization Act for Fiscal Year 2012, as amended (NDAA)
- The provision of specialized financial messaging services to the Central Bank of Iran and Iranian financial institutions described in Section 104(c)(2)(E)(ii) of the Comprehensive Iran Sanctions and Divestment Act of 2010 (CISADA)
- The provision of underwriting services, insurance, or reinsurance
- Iran’s energy sector
Again, while the administration has not provided more specific information regarding the sanctions that will be reimposed, some of the specific sanctions that appear most likely to be reimposed after this 180-day wind-down period include:
- Iran port operators, shipping and shipbuilding sectors sanctions in IFCA
- Petroleum-related transactions with, among others, NIOC, NICO, and NITC sanctions in EO 13622
- Foreign financial institutions and Iranian financial institutions sanctions in the NDAA and EO 13599;
- Specialized financial messaging services involving the Central Bank of Iran and Iranian financial institutions sanctions in CISADA and TRA
- Underwriting services, insurance, and reinsurance sanctions in IFCA
- Energy sanctions in ISA and IFCA
FAQ 1.3 indicates that business “undertaken pursuant to the US sanctions relief provided for in the JCPOA” that is related to activities and sectors specified in the FAQ should wind down prior to November 5, 2018.
Aviation Sector Activity
In FAQs 4.1 and 4.2, OFAC indicated that it will no longer consider new or pending license applications under the Statement of Licensing Policy for Activities Related to the Export or Re-export to Iran of Commercial Passenger Aircraft and Related Parts and Services (JCPOA SLP). With respect to the specific licenses issued under the JCPOA SLP that are currently operative, FAQ 4.2 indicates that OFAC expects to revoke these licenses and replace them with “authorizations to provide for a wind-down period that will end on August 6, 2018.”
In FAQ 4.3, OFAC indicated that it also expects to revoke, “as soon as is administratively feasible,” General License I, which authorized US persons to enter into, and to engage in transactions that are ordinarily incident to the negotiation of and entry into, contingent contracts for activities eligible for authorization under the JCPOA SLP. In place of General License I, OFAC expects to issue a revised authorization for a 90-day wind-down of activities authorized pursuant to this General License.
FAQs 4.1 and 4.2 indicate that OFAC will still consider applications pursuant to the safety of flight licensing policy set forth in 31 C.F.R. § 560.528.
General License H
Non-US entities owned or controlled by US persons will no longer be authorized under OFAC General License H to engage in certain activity related to Iran. FAQ 4.4 explains that General License H will be revoked “as soon as is administratively feasible,” and will be replaced with a more narrowly scoped authorizations to allow US-owned or US-controlled foreign entities, to engage in all transactions ordinarily incident and necessary to wind down activities that were previously authorized by November 4, 2018. After November 4, 2018, US-owned or US-controlled foreign entities again will be required to apply for specific licenses from OFAC in order to conduct nearly any activity related to Iran.
Iranian-Origin Foodstuffs and Carpets
OFAC FAQ 1.2 indicates that “following the 90-day wind-down period that ends on August 6, 2018, the US government will revoke” the JCPOA-related authorizations for activities related to the importation into the United States of Iranian-origin carpets and food stuffs and certain financial transactions general license at 31 C.F.R. §§ 560.534, 560.535. In FAQ 2.1, OFAC indicates that “[a]s soon as administratively feasible, OFAC intends, via Federal Register publication, to replace” these licenses with “more narrowly scoped authorizations to allow US persons and, as appropriate, US-owned or US-controlled foreign entities, to engage in all transactions ordinarily incident and necessary to wind down activities.”
Other Issues Related to Sanctions Reimposition
“New” Business During the Wind-Down Periods
The US government’s posture with respect to “new” business with Iran during the wind-down periods is not clear. On the one hand, statements have been made by the National Security Advisor and by a State Department official indicating that “new” contracts are precluded during the wind-down period. On the other hand, OFAC’s guidance is not clear on this point, and could be read to suggest that new activity is not prohibited, so long as it is completed during the wind-down period.
OFAC FAQ 2.2 states, “Can I engage in new activity involving Iran if the activity will not extend beyond the relevant wind-down period?” OFAC’s response does not provide a direct answer to that question, but reiterates that entities engaged in activity consistent with the JCPOA should take steps to wind-down that activity by the applicable wind-down dates. OFAC’s response notes that “[w]hen considering a potential enforcement or sanctions action with respect to activities engaged in [after the wind-down dates] OFAC will evaluate efforts and steps taken to wind-down activities and will assess whether any new business was entered into involving Iran during the applicable wind-down period.”
The Treasury Department’s statement notes that the State Department has issued “necessary statutory sanctions waivers” to allow for the wind-down periods for secondary sanctions, although the waivers have not been made public. Treasury’s statement and OFAC’s FAQs also indicate repeatedly that, “as soon as is administratively feasible,” OFAC expects to replace existing licenses with new authorizations to allow the wind down of transactions and activities. (It is possible that the revised licenses and authorizations issued by OFAC will provide further clarity on this point.) Treasury’s statement further notes that “at the end of the 90-day and 180-day wind-down periods, the applicable sanctions will come back into full effect.”
Post-Wind Down Period Payments
Even after the applicable wind-down periods, FAQ 2.1 notes that OFAC will allow certain payments to non-US, non-Iranian persons that fully delivered goods or services to an Iranian counterpart before the end of the relevant wind-down period in fulfillment of a written contract or agreement that was entered into before May 8, 2018, provided that the transaction was in compliance with applicable sanctions laws at the time. The FAQ notes, however, that US persons and the US financial system cannot be involved in such payments. It is not clear from the FAQs whether or how the wind-down provisions would apply to payments for purchases of goods or services from Iran.
Re-designation of SDNs
Pursuant to the JCPOA, OFAC moved many entities that met the definition of “Government of Iran” or “Iranian financial institution” from the SDN list to a newly-established “List of Persons Identified as Blocked Solely Pursuant to Executive Order 13599” (the EO 13599 list). Other persons were removed from the SDN list and were not added to any other OFAC lists.
In FAQ 3.1, OFAC indicated that it expects to return the “Government of Iran” or “Iranian financial institution” entries from the EO 13599 list to the SDN list no later than November 5, 2018. The FAQ further states that beginning on November 5, 2018, activities with “most persons” moved from the EO 13599 List to the SDN List will be subject to secondary sanctions, and that such persons “will have a notation of ‘Additional Sanctions Information – Subject to Secondary Sanctions’ in their SDN List entry.”
FAQ 3.2 states that, no later than November 5, sanctions will be reimposed “as appropriate” against other persons removed from OFAC sanctions lists as of the date of the JCPOA. Persons against whom sanctions are reimposed and who are subject to secondary sanctions will also have a notation of “Additional Sanctions Information – Subject to Secondary Sanctions” in their SDN List entry.
Officials from the State Department clarified that the re-designation of individuals as SDNs will not occur overnight, stating that OFAC’s “aim is to relist all of those individuals and entities by the end of the six-month wind down” period. The officials went on to state that this was done both “for practical reasons, but also for policy reasons,” including to allow for a full six-month wind-down of energy-related and petroleum-related activities.
FAQ 1.5 clarifies that, due to the change in policy, OFAC’s new guidance regarding Iranian sanctions supersedes past FAQs (most notably, the lengthy FAQs issued by OFAC in January 2016) to the extent that they are inconsistent. Among other things, the explanation of wind-down periods in the new FAQs supersedes the explanation from the earlier FAQs.
US Sanctions Implementation Issues to be Monitored
A number of issues critical to US Iran sanctions policy bear careful monitoring moving forward:
“Enforcement” of US Iran Sanctions
Multiple US government officials have suggested that the Trump Administration will aggressively implement and “enforce” the reimposed sanctions. Secretary of State Pompeo stated that “sanctions will go into full effect and will remind the Iranian regime of the diplomatic and economic isolation that results from its reckless and malign activity.” In a press briefing held by unidentified senior State Department officials shortly following the announcement, the State Department emphasized that the purpose of the reimposition of sanctions was to target companies that do business with Iran. One of the State Department officials noted that the Trump Administration wanted to rebuild the “extensive architecture of secondary sanctions” that was used previously as “leverage” to engage with countries “to partner with us to build the economic isolation of Iran.” Secretary of the Treasury Mnuchin has also indicated at a US Senate Appropriations subcommittee hearing on May 22, 2018, that the administration has “communicated with our European partners” that the administration will be enforcing the secondary sanctions against Iran.
That said, sanctions implementation and “enforcement” is resource-intensive and will fall to the State Department and OFAC at a time when the agencies also face demands to implement sanctions on Russia, North Korea, Venezuela, and in other areas of the world. It is a practical reality that the administration will need to prioritize its resources, and it remains to be seen how Iran secondary sanctions implementation will compare to these other priorities.
“Significant Reduction” Exceptions
According to FAQs 5.1 and 5.2, OFAC will reimpose sanctions on foreign financial institutions that help conduct or facilitate the purchase of Iranian crude oil pursuant to section 1245(d) of the National Defense Authorization Act of 2012. However, there is an exception from these sanctions for countries that have “significantly reduced” imports of Iranian crude oil. The “significant reduction” exception in Section 1245(d)(4)(D) of the NDAA by the Iran Threat Reduction and Syria Human Rights Act of 2012, applies if the Secretary of State, in consultation with the Secretary of the Treasury and other agencies, has determined that the country with primary jurisdiction over the foreign financial institution has significantly reduced its purchases of Iranian crude oil during a specified period of time. Notably, the president already fulfilled the first requirement of the exception when he announced on May 14, 2018 that there is a sufficient supply of petroleum and petroleum products from countries other than Iran to permit a significant reduction in the volume of petroleum and petroleum products purchased from Iran by or through foreign financial institutions.
While petroleum-related sanctions take effect on November 4, 2018, the State Department will evaluate and make determinations at the same time as to whether foreign countries have made a “significant reduction” in the volume of their purchases of Iranian crude oil. If so, certain imports of Iranian petroleum or petroleum products would not be considered sanctionable if specific criteria were met. As a result, OFAC advised countries seeking that exception to reduce the volume of crude oil purchased during the 180-day wind-down period, and OFAC noted that reduction can be demonstrated by the quantity and percentage of reduction in purchases or the termination of contracts for future delivery.
Significant reduction exceptions were previously granted in 2012 and 2013. However, it is difficult to draw on these prior exceptions as guidance as the circumstances were substantially different than now (e.g., the EU in 2012 imposed a prohibition on the importation from Iran of crude oil and petroleum products).
Although the administration has made clear that it does not expect to issue further broad waivers of the statutory secondary sanctions on Iran, administration officials have not necessarily foreclosed the possibility of granting waivers for particular transactions or projects on a case-specific basis. The Secretary of State is provided the delegated authority to issue waivers under the ISA, the NDAA, and IFCA, in consultation with the Secretary of the Treasury and (in some circumstances) with other officials. Waivers of sanctions may be issued for a time-limited period of 120 days to one year, depending on the statute, and pursuant to the criteria set forth in each statute. Absent further significant policy developments, we do not anticipate that the administration will issue many waivers.
Additional US Sanctions
The US government clearly is intent on imposing new sanctions designations under existing authorities. On May 31, OFAC continued its steady stream of new Iran-related designations with designations against three entities and five individuals for their alleged roles in serious human rights abuses, the operation of information technology that facilitates monitoring or tracking that could enable serious human rights abuses, and censorship activities that limit the exercise of freedom of expression or assembly. This was the sixth new series of Iran sanctions designations announced by Treasury since President Trump’s May 8 decision to withdraw from the JCPOA. For example, on May 15, 2018 OFAC designated the governor and a senior official of the Central Bank of Iran (CBI) as Specially Designated Global Terrorists (SDGTs) for CBI’s funneling of money on behalf of the IRGC-QF to Hezbollah. On May 22, OFAC designated five Iranians for their role in providing ballistic-missile expertise and weapons to the Houthi rebels in Yemen on behalf of the IRGC-Qods force. On May 24, OFAC announced new designations targeting procurement networks and aircrafts associated with Mahan Air and other designated Iranian airlines. In total, OFAC designated nine individuals and entities as SDGTs pursuant to EO 13224 for procuring export-controlled US origin goods for sanctioned Iranian airlines and 31 aircraft in which persons previously designated under EO 13224 have an interest. The rapid pace of these new designations shows that the administration is actively pursuing a variety of mechanisms through which to pressure Iran in addition to the sanctions being rolled back as part of the JCPOA withdrawal.
In addition, it will be important to monitor whether the US creates any new sanctions to cover additional industries or activities beyond those that will go back into effect with the JCPOA. During the period preceding the JCPOA, the Obama Administration and the US Congress took numerous actions to expand the scope of US secondary sanctions on Iran. Presumably the Trump Administration and Congress will also consider taking additional actions to expand the scope of US primary and/or secondary sanctions. (In a speech given after the withdrawal announcement on May 21, 2018, Secretary of State Pompeo said that the new sanctions will “indeed end up being the strongest sanctions in history when we are complete.”)
It is also unclear whether the Trump Administration will consider narrowing some of the Iran sanctions licenses that were in place prior to the JCPOA. These include General License D-1, which authorizes certain exports to Iran of hardware, software and services incident to personal communication, and General License J-1, which authorizes the temporary sojourn of civil aircraft into Iran, among others.
Foreign Policy Issues That Could Impact US Iran Sanctions
Future of JCPOA
The future of the JCPOA is unclear. Most countries and international bodies, with the exception of Saudi Arabia and Israel, have expressed disapproval of the US decision to withdraw. In particular, the European Union has pledged continued support for the JCPOA. Following two meetings between High Representative Federica Mogherini and French Foreign Minister Jean-Yves Le Drian, German Foreign Minister Heiko Maas, UK Foreign Secretary Boris Johnson and Iranian Foreign Minister Mohammed Javad Zarif, Ms. Mogherini gave prepared remarks affirming all participants’ commitment to the JCPOA and reiterating their regret at the withdrawal of the United States.
Ms. Mogherini added that discussions had commenced with a view to arriving at solutions over the next few weeks for a number of matters, including (1) maintaining and deepening economic relations with Iran, (2) effective banking transactions with Iran, (3) the continued sale of Iran’s oil and gas products, and (4) further investments in Iran.
On May 23, Iran’s supreme leader laid out a number of demands that Europe must meet for Iran to remain in the JCPOA. The demands included creating mechanisms to safeguard EU-Iranian trade and Iranian oil exports. Ayatollah Khamenei also said that Germany, France, and the UK must pledge not to seek negotiations on Iran’s ballistic missile program and regional activities – topics they had previously discussed with US negotiators. He also warned that Iran could resume certain nuclear-related activity if Europe did not meet these demands.
If the JCPOA were terminated, UN Security Council sanctions could automatically come back into force, which would further complicate the position of those countries seeking to remain economically engaged with Iran.
EU Blocking Regulation
On May 18, the EU Commission announced the launch of the formal process to activate the EU blocking regulation (Council Regulation (EC) 2271/96) by updating the list of US sanctions on Iran falling within its scope. The Commission starts the process after receiving unanimous informal support from the leaders of the EU Member States to a package of measures that the Commission has proposed to protect the interests of EU companies investing in Iran and to demonstrate the EU’s commitment to the JCPOA. As part of the package, in addition to reactivating the EU blocking regulation, the Commission:
- Launched the formal process to remove obstacles for the European Investment Bank (EIB) to finance activities in Iran, under the EU budget guarantee.
- Will continue and strengthen the ongoing sectoral cooperation with and assistance to Iran, including facilitating financial assistance through the Development Cooperation or Partnership Instruments.
- Is encouraging Member States to explore the possibility of one-off bank transfers to the Central Bank of Iran which would allow the Iranian authorities to receive their oil-related revenues.
In order to activate the EU blocking regulation, the Commission will be amending the list of non-EU laws set out in the Annex to the Regulation 2271/96 by adding to that list the reimposed US sanctions on Iran.
Once the reimposed US sanctions are added to the Annex, the EU blocking regulation requires companies incorporated in the Member States to notify the Commission within 30 days whenever the renewed US extraterritorial sanctions directly or indirectly affect the economic or financial interests of the company. EU companies will also be prohibited from complying with the extraterritorial effects of US sanctions identified in the EU blocking regulation. The EU blocking regulation allows EU companies to recover damages in EU courts from persons causing damages as a result of the sanctions. Finally, the EU blocking regulation nullifies the effect in the EU of any foreign court judgments or decisions of administrative bodies which are based on the reinstated US sanctions.
The activation of the EU blocking regulation could be viewed as a political statement rather than an effective legal tool that the EU companies will be able to rely upon. At the same time, the EU blocking regulation could become an element of discussion between the EU and the US to try to mitigate the impact of the implementation of the reinstated US sanctions on Iran. But it also will complicate the situation of EU companies that will potentially face Member State enforcement of the EU blocking regulation, and in particular the prohibition on complying with US extraterritorial measures.
A “New” Iran Deal?
The White House has outlined a broad list of requirements to which Iran must agree prior to receiving sanctions relief, including halting the development of a nuclear weapon:
- Never have an intercontinental ballistic missile, cease developing any nuclear-capable missiles, and stop proliferating ballistic missiles to others
- Cease its support for terrorists, extremists, and regional proxies, such as Hezbollah, Hamas, the Taliban, and al-Qa’ida
- End its publicly declared quest to destroy Israel
- Stop its threats to freedom of navigation, especially in the Persian Gulf and Red Sea
- Cease escalating the Yemen conflict and destabilizing the region by proliferating weapons to the Houthis
- End its cyberattacks against the United States and allies, including Israel
- Stop its grievous human rights abuses, shown most recently in the regime’s crackdown against widespread protests by Iranian citizens
- Stop its unjust detention of foreigners, including United States citizens
Echoing earlier criticism of the JCPOA, President Trump also called for an international “coalition of nations” to deny Iran all paths to a nuclear weapon and to counter the totality of the regime’s malign activities. Iran is unlikely to agree to the above comprehensive list of demands, suggesting either that the Trump Administration is taking a strong initial position for the purpose of negotiation or that the administration does not see an opportunity to reach a good faith agreement.
National Security Advisor John Bolton emphasized in a press briefing shortly after the US announcement that the United States was prepared to discuss “a much broader deal addressing all aspects of Iran’s conduct that we find objectionable.” On May 18, the State Department Director of Policy Planning held a teleconference news briefing regarding Iran and the JCPOA withdrawal. The State Department official added that a new deal would “involve a range of things around [Iran’s] nuclear program, missiles, proliferating missiles and missile technology, and support for terrorists, and its aggressive and violent activities that fuel civil wars in Syria and Yemen.” In the speech given after the withdrawal announcement on May 21, 2018, Secretary of State Pompeo reiterated the above conditions of any new agreement with Iran. He also stated that the United States was prepared to “end the principal components of every one of our sanctions against the regime” if Iran took actions which benefitted the Iranian people.
To date, Iran has categorically rejected negotiating a new or broader deal, and the EU and US allies have not indicated their support for any such US initiative.
We will continue to monitor and report on developments as the US government provides additional guidance and works to form an international coalition to implement the reimposition of sanctions pursuant to its withdrawal from the JCPOA. Further commentary is available on the Steptoe International Compliance Blog. You can also follow us on Twitter (@SteptoeIntlReg).