On 18 May 2018, the European Commission announced its intention to expand Council Regulation (EC) 2271/96 of 22 November 1996 (the “Blocking Regulation”) in order to discourage European companies from complying with newly re-imposed U.S. Iran-related sanctions. On 6 June 2018, the European Commission adopted a delegated regulation to enact these changes, which will come into force by 6 August 2018 (the date when the first wind-down period for the U.S. secondary sanctions on Iran expires), provided the EU Parliament and Council do not have objections.

This blogpost considers how the Blocking Regulation will work in practice for UK and European companies, in particular in light of the UK’s departure from the European Union (“EU”) in 2019. Continue Reading The Blocking Regulation and Brexit: the Effect of U.S. Sanctions in a Changing Europe

On May 8, 2018, President Trump announced that the United States will cease its participation in the Joint Comprehensive Plan of Action (the “JCPOA”) and reintroduce nuclear-related sanctions on Iran that were lifted following the implementation of the JCPOA, effectively restoring the 2013 Iranian sanctions program from a U.S. perspective.

The U.S. Department of the Treasury and the U.S. Department of State announced that to implement the President’s decision, they will introduce 90-day and 180-day wind-down periods with sanctions relief consistent to that currently provided by the JCPOA. Following these wind-down periods, U.S. secondary sanctions (i.e., sanctions targeting activity outside U.S. jurisdiction by threatening that those engaged in such activity will themselves be sanctioned by the United States) lifted under the JCPOA will be re-imposed.

In contrast to their responses in 2013, however, key allies are actively opposing U.S. sanctions policy. Although it is likely that the re-imposition of U.S. sanctions will have a significant disruptive effect on international financial transactions with Iran (which, even under the JCPOA, were never completely normalized), the impact and political fallout of secondary sanctions remains to be seen. The legal provisions are the same as those in place prior to the JCPOA, but the outcome may well be different.

Please click here to read the full alert memorandum.

On December 14, 2017, Cleary Gottlieb partner Paul Marquardt led a presentation titled, “Developments in U.S. Sanctions Against Iran, Russia, and Venezuela” as part of PLI’s Coping With U.S. Export Controls and Sanctions 2017 conference.

To view the full presentation, click here.

For additional information regarding the conference, please visit the event’s website.