Update on EU and US sanctions - 20th January 2014

A significant relaxation of sanctions against Iran, albeit on a temporary trial basis, is anticipated to commence at midnight on the 20th January. The EU will fast-track a Council Decision and Regulation to give effect to the European Commission's proposal arising from the Joint Plan of Action on Iran sanctions relaxation measures of November 2013. The US Office of Foreign Assets Control have confirmed the intention of the US administration to mirror this relaxation of sanctions measures. Circular 26/13 'Iran Sanctions Update' includes more detail on the changes in US sanctions measures.

Time period & designated persons/entities

It is important to note that the proposed relaxation of sanctions is for a defined period of six months from 20th January through to 20th July 2014 and will remain under review during that time. Members are advised that any transport contracts now permitted by that relaxation of current sanctions be fully executed by 20th July 2014 as no further extension of the time period is confirmed, as yet.

Furthermore, the proposed relaxation does not include the prohibition of dealings with designated persons or entities.

Oil & petroleum products

There is no relaxation of the current prohibition on EU purchase or import of Iranian oil and petroleum products but the waiver under US NDAA for certain non-EU states will remain. Transportation of oil and petroleum products consistent with those restrictions will be permitted under the terms of the relaxation. The Club will be able to provide cover to both EU and non-EU owned and registered ships transporting oil and petroleum products consistent with this latest form of sanctions. NOTE: A shipowner transporting Iranian oil or petroleum cargo to a non-NDAA waiver country will be in breach of sanctions and will not be covered by the Club.

Petrochemical products

The current prohibition on import, purchase, transport and insurance of petrochemical products from Iran will be suspended in full under this relaxation of sanctions. However, any P&I cover will be subject to other applicable non-EU or non-US sanctions or prohibitions.

Financial transactions

The general threshold limits on financial transactions will be increased to Euros 400,000 although sanctions remain unchanged for transactions with designated persons or entities.

Vessels for storage/transport of oil & petrochemicals

With the exception of charters to, or contracts with designated entities or persons, the sanctions on making available ships for the transportation or storage of oil and petrochemical products will be suspended in full under the terms of the relaxation.