No new Iran sanctions (yet)

In spite of adverse publicity on Iranian nuclear procurement activities and the Iranian rocket program in the last couple of days, a snap back of the lifted sanctions against Iran is currently not pending.

On 7 July, German Chancellor Angela Merkel had expressed concern that Iran – in clear contradiction of the relevant provisions of the UN Security Council – unabatedly continued to develop its rocket program and that, unfortunately, the rocket program had not been terminated by the historical Vienna Agreement.

This is because under the Joint Comprehensive Plan of Action (JCPOA) Iran has only committed to stop its nuclear program, but not its rocket program. Violations with regard to the rocket program therefore cannot justify a snap back of the lifted EU and US sanctions.

This also holds true with regard to the fact that, according to the recently published annual report of the German Federal Office for the Protection of the Constitution (Bundesamt für Verfassungsschutz), Iran continued illegal procurement activities in the field of nuclear technology in Germany in 2015 at what is a high level also by international standards: According to media reports, the Federal Office has clarified that, since January 2016 (implementation day), there has been a decrease in the Iranian nuclear-related procurement activities.

Against this background, it is currently not to be expected that the Dispute Resolution Mechanism provided for in the JCPOA for violations of this agreement will be triggered, which, at its end, could lead to a snap back of the lifted sanctions against Iran. Nevertheless, companies doing business in Iran should design their contracts in a way that enables them – should the case arise – to withdraw from the business at any time.

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