Delisting of Entities on the U.S. Sanctions Lists
January 16, 2016, marked the Implementation Day for the Joint Comprehensive Plan of Action (“JCPOA”) – known in Iran as Barnamey-e Jame Eghdam-e Moshtarek (“BARJAM”). On Implementation Day, the International Atomic Energy Agency (“IAEA”) verified that Iran implemented key nuclear-related commitments set forth in the JCPOA, and the U.S. Secretary of State confirmed the IAEA’s verification. As a result of Iran meeting its JCPOA commitments, as part of the lifting of nuclear-related sanctions, the United States Government removed over 400 individuals and entities listed in the following:
- the Specially Designated Nationals (“SDN”) List;
- the Foreign Sanctions Evaders (“FSE”) List; and
- the Non-SDN Iranian Sanctions Act (“NS-ISA”) List.
The above Lists are overseen and published by the U.S. Treasury Department’s Office of Foreign Assets Control (“OFAC”). SDNs are individuals and companies owned or controlled by, or acting for or on behalf of, targeted countries, and also lists non-country-specific individuals, groups, and entities. SDN assets are blocked and U.S. persons are generally prohibited from dealing with SDNs. FSEs are foreign individuals and entities determined to have violated, attempted to violate, conspired to violate, or caused a violation of U.S. sanctions on Iran, as well as foreign persons who have facilitated deceptive transactions for or on behalf of persons subject to U.S. sanctions. Transactions by U.S. persons or within the United States involving FSEs are prohibited. As of Implementation Day, sanctions imposed on all persons named on the NS-ISA List were terminated, and that list is now empty.
Following Implementation Day, noteworthy delisted entities include, among others:
- the Central Bank of Iran and most Iranian financial institutions;
- a number of American, Asian, and European shipping and trading companies;
- almost all of the aircrafts and vessels that belong to Iran Air, Iran Shipping Lines, and the National Iranian Tanker Company;
- Iran’s Ministry of Energy and its Ministry of Petroleum; and
- major Iranian energy companies and their foreign affiliates, including the National Iranian Oil Company (“NIOC”), and Naftiran Intertrade Company (“NICO”).
The names of the approximate 400 delisted individuals and entities are set out in Attachment 3 to Annex II of the JCPOA. Nevertheless, more than 200 Iranian or Iran-related individuals and entities continue to remain on the SDN list.
Simultaneous with delisting of Iranian aircrafts from the SDN list, OFAC established a favorable licensing policy regime through which U.S. persons may request specific authorization to engage in transactions for the sale, export, lease, or transfer of commercial passenger aircraft and related parts and services to Iran. OFAC’s licensing policy also applies to associated services including the supply of parts, warranty service, brokering, insurance and financing, as well as the involvement of individual U.S. persons in the transaction.
In addition, non-U.S. persons are no longer subject to sanctions for investing in Iran’s oil, gas, or petrochemical sectors, provided that transactions do not involve persons on the SDN list. In addition, U.S.-owned or controlled foreign entities are now permitted to engage in transactions that would otherwise be prohibited if engaged in by a U.S. person.
With the removal of over 400 individuals and entities from the SDN, FSE, and NS-ISA Lists, particularly the Central Bank of Iran, Iran Air, and the National Iranian Oil Company, the global marketplace can expect changes to emerge within the spectrum of transactional options available with respect to Iran, particularly its civilian aerospace and natural resource sectors.
The views expressed in this article are solely those of the author; they do not necessarily represent the position of the Department of Labor or of any other agency.
Emad Maghsoudi is a 2016 Juris Doctor candidate at Fordham University School of Law, and holds an MA in Management from Harvard University. Emad served as an International Trade Analyst for the U.S. Department of Labor.