The deadline for a nuclear deal and the expiration of temporary sanctions relief is fast approaching — November 24 — extended from the original July 20, 2014 deadline. It shouldn’t come as too much a surprise, however, that officials from different countries involved in the negotiations suggested last week that a deal by Monday is unlikely and that a second extension is under consideration.
The Joint Plan of Action (JPOA), reached on November 24, 2013 among the P5+1 (the U.S., UK, Germany, France, Russia, and China) and Iran, intends to halt, and in some respects roll back, progress on Iran’s nuclear program in return for limited and reversible sanctions relief. The U.S. State Department and Treasury Department have eased sanctions relating to certain activities and services for the JPOA Period (originally, January 20, 2014 to July 20, 2014 but extended to November 24, 2014).
In light of the impending deadline and potential extension, a brief recap of the scope of the temporary sanctions relief may be warranted:
So long as the activity does not involve a “U.S. Person” (or person/entity otherwise subject to the Iranian Transactions and Sanctions Regulations), the JPOA provides for the temporary suspension of U.S. sanctions on Iran’s:
Petrochemical exports (even from certain named SDNs, for example, National Petrochemical Company),
Crude oil sales (so as to allow Iran’s current customers to purchase their current average amounts of crude oil and to allow repatriation of a total of $7 billion in Iranian revenue held abroad),
Auto industry, and
Gold and other precious metals.
Recall that for the most part, the JPOA temporary relief does not cover U.S. Persons or others subject to the ITSR. (Additionally note, unlike most U.S. sanctions programs, the U.S. sanctions against Iran extend so far as to subject foreign entities that are owned or controlled by a U.S. Person.) Two additional sanctions suspension provisions that U.S. Persons have been able to take advantage of relate to civil aviation and humanitarian activities.
The JPOA provides for:
temporary licensing by the Treasury Department for the supply and installation in Iran of spare parts for safety of flight for Iranian civil aviation and
a financial channel to further facilitate humanitarian trade using Iranian oil revenues held abroad.
All of the above temporary suspensions also apply to necessary “associated services,” like insurance, transportation, and financial services. Such relief is strictly limited to conduct that occurs within the January 20 – November 24 period, and applicable transactions must be fully completed by the deadline.
Negotiators are meeting in Vienna this week for a a final push towards a deal.
Nina Mohseni is an associate attorney at Sandler, Travis & Rosenberg in Chicago where she practices customs and international trade law. She is the vice president of the Chicago chapter of the Organization of Women in International Trade (OWIT Chicago) and vice chair of the Chicago Bar Association’s International Corporate and Trade Law Committee.