Newsflash: Further step of the US Government in its withdrawal from the JCPOA
Cologne, 29th June 2018
The US Government, represented by the Office of Foreign Assets Control (OFAC), has taken a further step to withdraw from the Joint Comprehensive Plan of Action (JCPOA).
As announced, General Licences H and I as well as a General Licence to import carpets and foodstuff have been cancelled.
For German enterprises, the withdrawal of General Licence H is of particular significance. This permitted subsidiaries of US enterprises situated outside of the USA to conduct business with Iranian partners if the latter operated within the scope permitted pursuant to the JCPOA. Despite the fact that this exception still raised numerous compliance questions, it nevertheless provided a possibility to continue conducting business with Iranian partners. With the cancellation of General Licence H, this possibility now no longer exists for subsidiaries of US enterprises. Enterprises are now only permitted to conduct their ongoing business for the duration of the wind-down period (see Newsflash dated 9 May 2018). A new General Licence is to be published in this respect, the applicability of which will be limited to the deadlines of the wind-down periods.
The same situation applies to General Licence I, which was granted for the supply of civil aircraft and, above all, spare parts, as well as the General Licence for “carpets and foodstuff”, which concerned imports from Iran.
The equally important General License for the supply of drugs and medical devices is not affected by the current measure.
A link to the announcements and updated FAQ of the OFAC can be found here.
This measure is a further significant political sign set by the US Government with regard to Iran. The economic importance is most likely of lesser importance, however. General License H, in particular, was actually only used very rarely in any event, since the majority of the US parent companies had generally prohibited their foreign subsidiaries from conducting business with Iranian partners, irrespective of the possibilities which existed pursuant to General License H.