US amended Iran sanctions guidance

Last month, the US revised its guidance on its Iran sanctions (link here) to state that:

1) Transactions between foreign entities and non-sanctioned entities that are minority owned, or controlled in part by an Iranian or Iran-related SDN are “not necessarily sanctionable” under US law.  OFAC recommends caution in respect of those transactions, to ensure that they do not directly involve a sanctioned person.

2) Screening the name of a potential Iranian counterparty against the SDN list is an expected but not necessarily sufficient due diligence step, and non-US persons should consult their local regulators and maintain records documenting due diligence efforts.

3) OFAC advises non-US persons that OFAC does not expect non-US financial institutions to repeat the due diligence their customers have performed on Iranian customers, unless they believe that those processes were insufficient.

Secretary of State John Kerry made a statement suggesting that ordinary due diligence was now acceptable with respect to Iran. A State Department official has since then made clear that banks and businesses are expected to exercise due diligence in any overseas investment or transaction, and for a high-risk jurisdiction like Iran the norm is enhanced due diligence.

This entry was posted in Iran, USA by Maya Lester QC. Bookmark the permalink.

About Maya Lester QC

Maya Lester QC has a wide ranging practice in public law, European law, competition law, international law, human rights & civil liberties. She has a particular expertise in sanctions. As the most recent (2016) Chambers & Partners directory put it, she "owns the world of sanctions". She spent 2011-12 in New York at Columbia Law School lecturing and writing on sanctions. She represents and advises hundreds of companies and individuals before the European and English courts and has acted in most of the leading cases, including Kadi, Tay Za, Central Bank of Iran, NITC and IRISL.

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