Three individuals – Alexander Samuel George, Paul Robert Attwater, and Iris Louise Attwater – have been convicted in the UK of evading export controls in relation to Iran.
Alexander George, who was sentenced yesterday to 2½ years’ imprisonment, shipped military items to Iran, including Russian MiG and US F4 Phantom parts, through various companies and countries without the appropriate licence. Paul Attwater and his wife Iris, who each received suspended sentences of 6 months’ imprisonment last month, sourced dual-use aircraft parts from the USA and shipped them to Alexander George’s companies in Malaysia and Dubai, which then sent them to Iran.
The offenders were also disqualified from being a company director (9 years for Alexander George, and 6 years each for Paul and Iris Attwater). POCA proceedings will now follow to recover the money made from the criminality. See UK Press Release.
OFAC has designated 5 individuals and 4 entities of an “international network through which the Iranian regime, working with Russian companies, provides millions of barrels of oil to the Syrian government. The Assad regime, in turn, facilitates the movement of hundreds of millions of U.S. dollars (USD) to the Islamic Revolutionary Guard Corps-Qods Force (IRGC-QF) for onward transfer to HAMAS and Hizballah.” The designations were made pursuant to Syria-related Executive Order 13582 and/or terrorism-related Executive Order 13224 (both authorities impose US asset freezes). See OFAC Notice, US Treasury Press Release, Department of State Press Release, and OFAC Advisory: Sanctions Risks Related to Shipping Petroleum to Syria.
The 5 individuals: Muhammad Qasim al-Bazzal; Mohamed Amer Alchwiki; Andrey Dogaev; Rasoul Sajjad; and Hossein Yaghoubi Miab.
The 4 entities: Global Vision Group (Russia-based); Promsyrioimport (Russia-based); Tadbir Kish Medical and Pharmaceutical Company (Iran-based); and MB Bank (Russia-based).
Following the full re-imposition of US Iran sanctions last week, the US has granted Iraq a temporary 45-day sanctions waiver to “continue purchasing natural gas and electricity from Iran”. See video announcement from the US Embassy in Baghdad, Iraq.
Eight other jurisdictions (China, India, Italy, Greece, Japan, South Korea, Taiwan and Turkey) were initially granted temporary waivers on the importation of Iranian oil, on the basis that they would stop or greatly reduce oil revenues in the coming weeks.
Today, the US will complete the full re-imposition of sanctions on Iran that were lifted or waived under the JCPOA, aimed at “depriving the regime of the revenues that it uses to spread death and destruction around the world”, in particular oil revenue. The timing is said to coincide with the anniversary of the 1979 storming by Iranian revolutionaries of the US embassy in Tehran when 52 American diplomats were held hostage for 444 days. Key points:
- The last set of Iran sanctions that were lifted under the JCPOA will be re-instated today, including measures against Iran’s energy, ship building, shipping, and banking sectors (the first set of measures were imposed on 7 August 2018).
- Over 700 individuals, entities, vessels and aircraft have also been added to the SDN list, including 50 Iranian banks and their foreign and domestic subsidiaries, oil exporters, and shipping companies – see OFAC Notice, Treasury press release, and new OFAC FAQs.
- 8 jurisdictions (China, India, Italy, Greece, Japan, South Korea, Taiwan and Turkey) will be granted temporary waivers on the importation of Iranian oil, on the basis that they will stop or greatly reduce oil revenues in the coming weeks.
- An amendment to the Iranian Transactions Sanctions Regulations will take effect today, reflecting the re-imposition of sanctions pursuant to certain sections of Executive Order 13846. See White House Factsheet.
A Joint Statement from EU High Representative Federica Mogherini, France, Germany, and the UK says that they “deeply regret the further re-imposition of sanctions by the US” and have committed to work on the “preservation and maintenance of effective financial channels with Iran, and the continuation of Iran’s export of oil and gas”. The EU Special Purpose Vehicle (SPV), whose aim is to safeguard non-US trade with Iran, is not yet in place (see previous blog). In a Special Press Briefing last week, US Treasury Secretary Steven Mnuchin said that “if there are transactions that go through [the SPV which] have the intent of evading [US-Iran] sanctions, we will aggressively pursue our remedies”. Link to Updated UK Guidance on Trade and Export with Iran.
Today, OFAC issued an amendment to the Iranian Transactions and Sanctions Regulations, in order to take additional regulatory steps to implement the US decision to cease participation in the JCPOA. The amendment will take effect upon publication in the Federal Register on 5 November 2018. Further OFAC guidance will also be issued on that day relating to the full re-imposition of US Iran sanctions. See OFAC Notice.
In a separate action today, OFAC removed Turkey’s Minister of Justice, Abdulhamit Gul, and Minister of Interior, Suleyman Soylu, from the US Global Magnitsky sanctions list (US asset freezes and travel bans lifted). Both were listed in August 2018, pursuant to Executive Order 13818 (Global Magnitsky), over the arrest and detention of US Pastor Andrew Brunson (previous blog), who has since been released and returned to the United States. See OFAC Notice.
Yesterday, the Government of Denmark announced that it will be (inter alia) “heading efforts to have the EU discuss the need for further sanctions against Iran” after Danish security and intelligence services foiled a plot on behalf of an Iranian intelligence agency to “assassinate a person on Danish soil”. Denmark will also be recalling its ambassador in Tehran.
The Foreign Ministers of the Nordic countries – Sweden, Norway, Finland, Iceland, and Denmark – have issued a Joint Statement on the matter.
OFAC has designated 20 entities as Specially Designated Global Terrorists, pursuant to Executive Order 13224 (US asset freezes), for “providing financial support to the Basij Resistance Force (Basij), a paramilitary force subordinate to Iran’s Islamic Revolutionary Guard Corps (IRGC)”.
According to the US Treasury press release, “the IRGC’s Basij militia recruits, trains, and deploys child soldiers to fight in IRGC-fueled conflicts across the region. This Iran-based network is known as Bonyad Taavon Basij, which is translated as Basij Cooperative Foundation, and is comprised of [(at least) the 20 entities designated today]”, of which are “deeply entrenched in major Iranian industries, such as automotive, mines and metals, tractor manufacturing, and banking.”
The 20 entities: Andisheh Mehvaran Investment Company; Bahman Group; Bandar Abbas Zinc Production Company; Bank Mellat; Bonyad Taavon Basij; Calcimin; Esfahan’s Mobarakeh Steel Company; Iran Tractor Manufacturing Company; Iran Zinc Mines Development Company; Mehr Eqtesad Bank; Mehr Eqtesad Financial Group; Negin Sahel Royal Investment Company; Parsian Bank; Parsian Catalyst Chemical Company; Qeshm Zinc Smelting And Reduction Company; Sina Bank; Tadbirgaran Atiyeh Iranian Investment Company; Taktar Investment Company; Technotar Engineering Company; and Zanjan Acid Production Company. See OFAC Notice.
The UK Commercial Court has given judgment in Mamancochet Mining Ltd v Aegis Managing Agency Ltd & Others  EWHC 2643 (Comm) holding that:
– Defendants are liable to pay insurance claim under a marine insurance contract (covering the theft of shipments of steel billets).
– This is because payment would not “expose” the underwriters to EU or US sanctions on Iran if paid out before 4 November 2018 (the end of the wind down period for reimposed US Iran sanctions) therefore the sanctions clause (“no… insurer shall be liable to pay any claim… to the extent that… payment of such claim… would expose that… insurer to any sanction, prohibition or restriction under [UN] resolutions or the trade or economic sanctions, laws, or regulations of the [EU], [UK] or the [USA]”) does not apply.
– The Court said that “exposure” to sanctions meant that the payment had to breach sanctions as opposed to exposing insurers to a real risk of breach.
– The risk was insufficient here because US sanctions waivers were in place until 4 November 2018 (the wind down period following the US decision to withdraw participation in the JCPOA).
– The Court did not reach a concluded view on the Claimant’s argument that reliance on the sanctions clause would breach the EU Blocking Regulation, but saw force in the argument that the Blocking Regulation was not engaged where the insurer’s liability to pay a claim is suspended under a sanctions clause because the insurer is not “complying” with a third country’s prohibition but is simply relying upon the terms of the policy to resist payment.