Iran

Initial Imposition of EU Sanctions

The EU initially imposed sanctions against Iran in April 2007

UN Sanctions

UNSCR 1737 (2006) – Iran should without further delay suspend all enrichment-related and reprocessing activities

UNSCR 1747 (2006) – asset freezes and prohibition on doing business in certain materials with designated persons and entities

UNSCR 1803 (2007) – amendments and extensions to UNSCR 1737 (2006)

UNSCR 1929 (2010) – additional sanctions against Iran

Form of the Sanctions

Asset freezes

Embargo on material, goods and technology which could contribute to enrichment-related, reprocessing or heavy water-related activities, or to the development of nuclear weapon delivery systems

Travel bans

Criteria for Inclusion in Targeted Measures

Nuclear Proliferation

  1. persons and entities involved in nuclear and ballistic missile activities
  2. persons and entities controlled by the Islamic Revolutionary Guard Corps
  3. entities owned or controlled by the Islamic Republic of Iran Shipping Lines (IRISL)

Human Rights Violations

  1. persons complicit in or responsible for directing or implementing grave human rights violations in the repressions of peaceful demonstrators, journalists, human rights defenders, students or other persons who speak up in defence of their legitimate rights, including freedom of expression
  2. persons complicit in or responsible for directing or implementing grave violations of the right to due process, torture, cruel, inhuman and degrading treatment or the indiscriminate, excessive and increasing application of the death penalty, including public executions, stoning, hangings or the execution of juvenile offenders in contraventions of Iran’s international human rights obligations

Provisions in Force – Nuclear Proliferation

Council Regulation (EU) No 267/2012 (24 March 2012)

  • Prohibition on the provision of military equipment and technology contained in the Common Military List
  • Prohibition on the provision of software designed for information security
  • Prohibition on the provision of nuclear reactors and related equipment
  • Prohibition on the provision of equipment and technology used for the exploration, production and refining of oil or gas products
  • Prohibition on the importing into the EU of oil and petroleum products
  • Prohibition on the sale or purchase of a wide variety of metals and diamonds
  • Annex VIII contains a list of designated persons and entities under this Regulation. Originally the list contained 41 natural persons and 57 entities involved in nuclear or ballistic missiles activities, 15 entities controlled by the Islamic Revolutionary Guard Corps, and 3 entities controlled by Islamic Republic of Iran Shipping Lines

Amended by Council Implementing Regulation (EU) No 350/2012 (24 April 2012) to remove 1 person and 2 entities from the list

Amended by Council Implementing Regulation (EU) No 709/2012 (3 August 2012) to remove 5 persons from the list

Amended by Council Regulation (EU) No 708/2012 (3 August 2012) to clarify criteria for inclusion in targeted asset freezes

Amended by Council Implementing Regulation (EU) No 945/2012 (16 October 2012) to add 1 person and 34 entities to the list, and to remove 10 persons and entities from the list

Amended by Council Implementing Regulation (EU) No 1016/2012 (7 November 2012) to add National Iranian Oil Company Nederland to the list

Amended by Council Regulation (EU) No 1067/2012 (15 November 2012) to clarify exemptions to the asset freezes provided in Article 28a to Regulation No 267/2012

Amended by Council Regulation (EU) No 1263/2012 (22 December 2012) to provide that where a Member State had granted a license to engage in the exploitation of hydrocarbons to a designated entity then that Member State may authorise derogation from prohibitions where this was necessary to avoid environmental damage

Corrigendum (OJ L 332, 4 December 2012)

Amended by Council Implementing Regulation (EU) No 1264/2012 (22 December 2012) to add 1 person and 18 entities involved in nuclear or ballistic missile activities. 2 entities are removed from the list, including CF Sharp Shipping Agencies Pte Ltd

Amended by Council Implementing Regulation (EU) No 522/2013 (6 June 2013) to add 2 persons and 5 entities involved in nuclear or ballistic missile activities. 4 entities are removed from the list

Corrigendum (OJ L 41, 12 February 2013)

Amended by Council Regulation (EU) No 917/2013 (23 September 2013) to clarify the definitive countervailing duty rate for the importing of polyethylene terephthalate from Iran following the decision of the General Court in Novatex Ltd v Council of the European Union (T-556/10) on 11th October 2012

Amended by Council Implementing Regulation (EU) No 1154/2013 (16 November 2013) to add 6 entities involved in nuclear or ballistic missile activities, 1 person and 2 entities controlled by Islamic Republic of Iran Shipping Lines

Amended by Council Implementing Regulation (EU) No 1203/2013 (27 November 2013) to relist several entities that had previously won their annulment actions, including IRISL and others

Amended by Council Implementing Regulation (EU) No 1202/2014 (OJ L 325, 8 November 2014) to relist one individual and two entities on the basis of new statements of reasons and update the identifying information in relation to four entities

Council Decision 2010/413/CFSP (27 July 2010)

  • Prohibition on the provision of materials contained in the Nuclear Suppliers Group and Missile Technology Control Regime lists, and additional items that could contribute to enrichment-related or heavy water-related activities or to the development of nuclear weapon delivery systems
  • Prohibition on the supply of arms and related materiel
  • Prohibition on the provision of technical assistance or training related to the prohibited items
  • Prohibition on the provision of financial assistance to enterprises involved in commercial activity involving uranium mining and production of nuclear materials
  • Competent authorities may authorise derogations from the prohibitions
  • Prohibition on the provision of key equipment used for refining, exploration and production sectors of the oil and natural gas industry
  • Member States must exercise restraint in entering into new short term commitments for public and private provided financial support for trade with Iran
  • Member States shall not enter into new commitments for grants or financial assistance to the Government of Iran
  • Travel ban on persons listed in Annex I, as well as persons engaged in Iran’s proliferation-sensitive nuclear activities (listed in Annex II)
  • Asset freezes against persons and entities listed in Annex I
  • Annex I lists: i) 41 natural persons and 57 entities involved in nuclear or ballistic missile activities; ii) 15 entities controlled by the Islamic Revolutionary Guard Corps; iii) 3 entities controlled by the Islamic Republic of Iran Shipping Lines
  • Annex II lists: i) 17 natural persons and 42 entities involved in nuclear or ballistic missile activities; ii) 13 natural persons and 6 entities controlled by the Islamic Revolutionary Guard Corps; iii) 24 entities controlled by the Islamic Republic of Iran Shipping Lines

Amended by Council Decision 2010/644/CFSP (27 October 2010) to replace Annex II with a new list including: i) 17 natural persons and 42 entities involved in nuclear or ballistic missiles activities; ii) 13 natural persons and 6 entities controlled by the Islamic Revolutionary Guard Corps; iii) 23 entities controlled by Islamic Republic of Iran Shipping Lines

Amended by Council Decision 2011/299/CFSP (24 May 2011) to amend information relating to 4 natural persons listed in Annex II

Amended by Council Decision 2011/783/CFSP (2 December 2011) to add 22 natural persons and 26 entities involved in nuclear or ballistic missiles activities, 3 natural persons and 1 entity controlled by the Islamic Revolutionary Guard Corps, and 12 natural persons and 116 entities controlled by Islamic Republic of Iran Shipping Lines. Further amendments were made to information pertaining to existing listed entities.

Amended by Council Decision 2012/35/CFSP (24 January 2012) to introduce prohibitions on the purchase of Iranian crude oil and petroleum products. 12 entities are added to Annex II, HTTS are delisted

Amended by Council Decision 2012/152/CFSP (16 March 2012) to introduce a prohibition on the supply of specialised financial messaging services

Amended by Council Decision 2012/169/CFSP (24 March 2012)

Amended by Council Decision 2012/205/CFSP (24 April 2012) to remove 3 persons and entities from Annex II

Amended by Council Decision 2012/457/CFSP (3 August 2012) to remove 5 persons from Annex II

Amended by Council Decision 2012/635/CFSP (16 October 2012) to prohibit the trade of natural gas from Iran, in addition to a prohibition on the construction of new oil tankers for Iran, and a prohibition on the supply of key naval equipment to Iran. Furthermore, 1 person and 34 entities involved in nuclear or ballistic missile activities are added to the list. Information pertaining to the Central Bank of Iran is amended. 10 persons and entities are removed from the list.

Amended by Council Decision 2012/687/CFPS (7 November 2012) to add the National Iranian Oil Company to the list

Amended by Council Decision 2012/829/CFSP (22 December 2012) to include provisions imposing stricter monitoring of the activities of financial institutions within the EU with financial institutions in Iran

Amended by Council Decision 2013/270/CFSP (8 June 2013) to add 7 entities to the list and remove 4 entities from the list

Amended by Council Decision 2013/497/CFSP (10 October 2013) to amend the criteria for designation to include persons and entities that have themselves evaded or violated proliferation-related sanctions

Amended by Council Decision 2013/661/CFSP (16 November 2013) to relist a number of entities that had previously won their annulment actions, including Persia International Bank, Export Development Bank of Iran, Iran Insurance Company, Post Bank Iran, Bank Refah Kargaran, Naser Bateni, Good Luck Shipping and Iran Offshore Engineering & Construction

Amended by Council Decision 2013/685/CFSP (26 November 2013) to realist a number of entities that had previously won their annulment actions, including Islamic Republic of Iran Shipping Lines, Bushehr Shipping Co, Hafize Darya Shipping Lines, Irano-Misr Shipping Co, Investship and others

Amended by Council Decision 2014/21/CFSP (OJ L 15, 20 January 2014) to implement the provisions concerning Iranian sanctions in the Joint Plan of Action.

Amended by Council Decision 2014/480/CFSP (OJ L 215, 21 July 2014) to extend the provisions concerning sanctions outlined in the Joint Plan of Action.

Amended by Council Decision 2014/776/CFSP (OJ L 325, 8 November 2014) to relist one individual and two entities on the basis of new statements of reasons and update the identifying information in relation to four entities

Amended by Council Decision 2014/829/CFSP (OJ L 338, 25 November 2014) to extend the implementation of the measures in the Joint Plan of Action until 30 June 2015.

Provisions in Force – Human Rights Violations

Council Decision 2011/235/CFSP (14 April 2011)

  • Member States shall take necessary measures to prevent listed persons from entering or travelling through their territories
  • Asset freezes implemented against listed persons
  • Annex contains the sanctions list, including 32 natural persons

Amended by Council Implementing Decision 2011/670 (12 October 2011) to add 29 natural persons to the list

Amended by Council Decision 2012/168/CFSP (24 March 2012) to implement a prohibition on the sale of equipment that might be used for internal repression in Iran. Adds 17 natural persons to the list

Amended by Council Decision 2012/810/CFSP (21 December 2012) to provide that equipment can be transferred to Iran for the protection of EU personnel in Iran

Amended by Council Decision 2013/124/CFSP (12 March 2013) to renew restrictive measures until 13th April 2014

Amended by Council Decision 2014/205/CFSP (12 April 2014) to renew restrictive measures until 13th April 2015. Provides updated entries for 16 natural persons already on the list

Council Regulation (EU) No 359/2011 (14 April 2011)

  • Asset freezes against listed persons responsible for human rights violations
  • Annex I contains the list of designated persons responsible for human rights violations, including 32 natural persons
  • Annex II contains the list of competent authorities that can authorise derogations from the asset freezes

Amended by Council Implementing Regulation (EU) No 1002/2011 (12 October 2011) to add 29 natural persons to the list

Amended by Council Regulation (EU) No 264/2012 (24 March 2012) to include a prohibition on the sale of equipment which might be used for internal repression. Adds 17 natural persons to the list

Amended by Council Regulation (EU) No 1245/2012 (20 December 2012)

Amended by Council Implementing Regulation (EU) No 206/2013 (12 March 2013) to add 9 natural persons and 1 entity (the Iranian Cyber Police)

Amended by Council Implementing Regulation (EU) No 371/2014 (12 April 2014) to implement a prohibition on the sales of certain carcinogenic or harmful substances

Case Law

Nuclear Proliferation

In Bank Mellat v Council (T-496/10), the claimant Iranian commercial bank was listed and subject to asset freezes on the grounds that Bank Mellat had engaged in conduct which supported and facilitated Iran’s nuclear programmes whilst providing banking services to EU listed entities. Bank Mellat contested its listing on the grounds that the Council had breached its obligation to state the reasons for listing, as well as infringements of the rights of defence and rights to effective judicial protection, that the Council had committed a manifest error of assessment, and that the Council had infringed Bank Mellat’s right to property in a disproportionate manner. The General Court annulled the measures in so far as they concerned Bank Mellat on the basis of a breach of Bank Mellat’s right to receive reasons for its listing, and on the grounds of manifest error.

In Qualitest v Council (T-421/11), the applicant contested that the reasons given for its listing amounting to a “mere reference to the legal conditions for the application of the restrictive measures”. The General Court ultimately agreed and held that Qualitest had been added to the list “without any justification”, and that the Council had not provided any reason to support the listing.

In Bank Mellat v HM Treasury [2013] UKSC 39, the claimant was subject to an Order from HM Treasury prohibiting all persons operating in the financial sector from having a business relationship with the claimant. By a majority of 5:4, the Order was viewed as disproportionate and discriminatory, on the grounds that it had singled out Bank Mellat whilst ignoring other Iranian banks, in spite of the fact that there were no particular concerns about Bank Mellat.

In Bank Saderat Iran v Council (T-494/10), the applicant was listed on the grounds that it had provided financial services to listed entities. The General Court held that the Council’s reasons were excessively vague, having given no information regarding which entities Bank Saderat Iran was alleged to have provided services for. The Court strongly reaffirmed that the burden of proof is on the Council in these cases to provide sufficient evidence to justify the designations.

In Council v Manufacturing Support & Procurement Kala Naft (C-348/12 P), the applicant was listed on the basis that it was involved in selling equipment for use in Iran’s oil and gas sector. The ECJ held (overturning the General Court) that this was capable of being determined as constituting support for the Iranian nuclear programme. The ECJ held (in agreement with the General Court) that it did not have jurisdiction to determine the legality of general prohibitions of sanctions, only the legality of targeted measures.

In Fulmen & Mahmoudian v Council (C-280/12 P), the Council had appealed against the ruling of the General Court annulling restrictive measures in respect of the applicants. Fulmen, and its director Mr Mahmoudian, were listed on the grounds that they were “involved in the installation of the electrical equipment on the Qom/Fordoo site at a time when the existence of the site had not yet been revealed”. The ECJ held that the reasons were specific enough but were not sufficiently supported by evidence. The Council’s argument that it did not have to provide evidence in light of its confidential nature was rejected as an infringement of the applicants’ rights of defence and a restriction of the Court’s ability to adequately review whether the allegations were themselves justifiable.

In Islamic Republic of Iran Shipping Lines v Council (T-489/10), the applicant had been listed on the grounds that had supported the nuclear proliferation programme in Iran by shipping prohibited cargo. The Court held that the Council had provided insufficient evidence to support its allegations. The Court further held that it was insufficient and unlawful to designate an entity on the basis of speculation regarding a perceived future risk without current evidence detailing the entity’s actual involvement.

In Melli Bank Plc v Council (C-380/09 P), the applicant had been listed on the basis that it was wholly owned by a listed entity. The General Court had rejected the applicant’s challenge. The ECJ upheld the judgment of the General Court in part but disagreed with the General Court’s assertion that the phrase “owned or controlled” required further enquiry by the Council.

In Bank Saderat Plc v Council (T-495/10), the applicant was listed on the sole basis that it was wholly owned by Bank Saderat Iran, which was a listed entity. In this case, it was held by the General Court that, even where its parent company’s listing had been annulled, the applicant could not rely on that without also challenging their own listing’s substantive basis.

In Turbo Compressor Manufacturer v Council (T-404/11), the applicant was listed on the grounds that it had participated in procurement efforts for the Iranian nuclear programme. This reason was held to be vague and insufficient in light of an absence of supporting evidence. The General Court also suggested that targeted sanctions should not be imposed on an entity on the basis of past conduct where that conduct was not mirrored by a current threat assessment.

In HTTS Hanseatic Trade Trust & Shipping GmbH v Council (T-128/12 and T-182/12), the applicant German shipping company succeeded in its second application for annulment, having been delisted (T-562/10) and then relisted by the Council. Different reasons were given for each listing. The General Court annulled the second listing on the grounds that the Council had made a manifest error in assessing HTTS as being owned or controlled by IRISL. The fact that HTTS was registered at the same address as IRISL Europe was held to be insufficient grounds for the listing of HTTS.

In Iran Transfo v Council (C-392/11), the applicant was listed on the basis that it was alleged to have been involved in the construction of a nuclear facility in Qom.   the ECJ rejected an argument from the Council that the Iran sanctions regime should be subject to a less intensive standard of judicial review than the Al-Qaeda/Terrorist regime. Both regimes were seen to implement a severe impact on rights and liberties and, as such, should be subjected to the same high standards. Furthermore, the Council rejected the Council’s argument that the European institutions should not be expected disclose evidence given the intrinsic secrecy surrounding the nature of nuclear activities.

In Nabipour v Council (T-58/12), 11 individuals contested the asset freezes and travel bans that they had been subjected to on the grounds that they were alleged to have held positions within the Islamic Republic of Iran Shipping Lines or companies owned or controlled by that entity. All of the listings were annulled on the basis that IRISL’s own listing had been annulled and declared unlawful. The General Court also said that the Council could only include individuals on the basis outlined above where there was sufficient evidence that the individual was “capable of influencing the activities alleged against the company or entity employing him”.

In Iran Liquefied Gas Company v Council (T-13/R), the General Court refused the applicant’s application for interim measures to suspend operation of EU sanctions that prevented it from fulfilling its contractual obligations with European companies until the hearing of its annulment action. The General Court refused the application on procedural grounds (the application had been brought too late and with regard to the incorrect provisions).

In Abdulrahim v Council of the European Union (C-239/12 P), the applicant appealed to the ECJ and submitted that the General Court had erred in law by holding that he did not have an interest in bringing annulment proceedings because his name had been removed from the list during proceedings. The ECJ held that the removal of his name from the list did not deprive Mr Abdulrahim of an interest in securing recognition that he ought never to have been included in the list, given the potential damage to reputation that is an inherent part of being listed.

In Naser Bateni (T-42/12 and T-181/12), the applicant was listed on the grounds that he was or had been the director of a company that was included in the designated list. The General Court held that this was an insufficient reason upon which to justify a listing, without specific evidence against that individual.

In Iranian Offshore Engineering & Construction Co v Council (T-110/12), the applicant was subject to three export denials, in relation to which the General Court held that the Council had made a manifest error in that this by itself did not justify the listing.

In considering the annulment applications in Post Bank Iran (T-13/11), Iran Insurance Co (T-12/11), Good Luck Shipping LLC (T-57/12), and Export Development of Iran (T-4/11 and T-5/11), the General Court held that the burden of proof had not been discharged regarding the reasons for listing these entities. The Council was unable to establish that the applicants in each of these cases actually had provided support for the Iranian nuclear proliferation programme.

In Bank Refah Kargaran (T-24/11), the General Court held that the Council had breached its obligation to state its reasons as well as its obligation to disclose to the applicant the evidence that had been used against it. The Council had given one reason, namely that Bank Refah Kargaran had taken over Bank Melli’s operations after the latter’s listing. The Court held that this was an insufficiently detailed reason as it did not identify specific operations.

In Persia International Bank v Council (T-493/10), the General Court gave guidance on the common phrase used in Iranian Sanctions: “owned or controlled”. The applicant was 60% owned by the designated entity Bank Mellat. The General Court viewed this as an insufficient reason upon which to base a listing.

In Europaisch-Iranische Handelsbank (T-434/11), the applicant managed to secure a partial annulment of restrictive measures against it, alleging procedural errors on the part of the Council. However, certain transactions that Europaisch-Iranische Handelsbank had carried out on behalf of listed entities were viewed by the Court to have justified the listing. The applicant thus secured a partial annulment but remained on the designated list.

In North Drilling Co v Council (T-552/12), the applicant entity was listed on the grounds that it was a 100% subsidiary of another listed entity (National Iranian Oil Company). North Drilling successfully contested the listing on the grounds that it had had no connection with the listed entity since 2011 upon being privatised. Whilst the Council contested this point on the grounds that North Drilling were still effectively under state control, the Council did not permit the Council to rely on this new reason, as North Drilling had not been given the opportunity to comment on it.

In Ali Sedghi & Ahmad Azizi v Council (T-622/12), the applicants had been listed on the grounds that they worked for a bank that was itself a subsidiary of a listed entity. The General Court held that this was insufficient grounds for a listing, and that there was no evidence against the individuals themselves.

In Sina Bank v Council (T-67/12), the applicant bank, which had previously been successfully delisted, fought its second listing. The General Court held that the Council had infringed Sina Bank’s rights of defence in that it had justified the second listing with new evidence that Sina Bank had not been given an opportunity to comment on. The General Court annulled Sina Bank’s second listing, as well as the listing of Abdolnaser Hemmati, as an agent or employee of Sina Bank (see T-68/12).

In Sharif University of Technology in Iran (T-181/13), the applicant University was listed on the grounds that it was “providing support to Iran’s proliferation” activities, having provided laboratories for listed entities. The General Court held that a manifest error had been committed by the Council, which had also failed to discharge the burden of proof as it was not prepared to adduce evidence in support.

In National Iranian Tanker Company v Council (T-565/12), the applicant Iranian company operated a large fleet of double-hulled tankers, and was listed on the grounds that it was “effectively controlled by the Iranian government” and provided financial support to the government. The General Court held that the Council had made a manifest error and had no supporting evidence, and refused to allow the Council to adduce new reasons at trial that had not been included in the original restrictive measures against NITC.

In Babak Zanjani v Council (T-155/13) and Sorinet Commercial Trust Bankers Ltd v Council (T-157/13), Babak Zanjani was designated for providing assistance to designated entities for the purpose of avoiding the sanctions, and was described as a “key facilitator for Iranian oil deals”. Zanjani was also listed on the grounds that he owned and operated the Sorinet Group, of which the Sorinet Commercial Trust (another listed entity) was a part. The General Court annulled both listings on the grounds that the Council had no supporting evidence (the Member States concerned would not authorise the release of such material). The Court also clarified the time limit for annulment actions as beginning to run from 14 days from publication of notice in the Official Journal of the European Union in cases where the addresses of the designated party was not known.

 

One thought on “Iran

  1. Pingback: EU EXTENDS IRAN HUMAN RIGHTS SANCTIONS, & RELISTS BANK TEJARAT & 32 IRISL COMPANIES ON PROLIFERATION SANCTIONS - European Sanctions

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