US President Donald Trump's decision to withdraw from the Iranian nuclear deal and reimpose sanctions on Tehran comes into effect immediately for any new contracts but gives a wind-down period of 90-180 days, the White House has said.
"We have announced a withdrawal from the deal. So, we're out of the deal. The president signed a decision memorandum that instructs the departments and agencies to effectuate that. Part of that is reinstituting all of the nuclear-related sanctions that were waived by the Obama administration. So the sanctions are in effect as soon as they're promulgated," said National Security Advisor John Bolton.
"What that means is, with respect to any new or prospective contract that's covered by it -- with firms covered by our jurisdiction, that they are forbidden. So, in other words, no new contracts in the prescribed areas.
"For contracts that already exist, there is a wind-down period to allow an orderly termination of the contract, so that people who in good-faith reliance on the waiver of the sanctions -- have engaged in business are not totally surprised," Bolton explained.
He said there are going to be different wind-down periods depending on the nature of the commodities.
But I don't really think anybody in the business world is surprised at this action, he said.
Bolton said it's entirely possible that additional sanctions will follow as new information comes to light.
That's something that we should pursue vigorously because we want to put as much economic pressure on Iran as we can, and deny them the revenues that they would have gotten from the transactions we're now eliminating, he said, reiterating that the decision that Trump signed yesterday puts sanctions back in place that existed at the time of the deal.
What that means is that within the zone of economics covered by the sanctions, no new contracts are permitted, he said adding that the US Treasury will be announcing what they call wind-down provisions that will deal with existing contracts.
This contingency has been posted on the Treasury Department website since 2015 because of the potential for the use of the provisions of Resolution 2231, which we're not using because we're out of the deal. In other words, the concept that there would be a wind-down period has been there for a long time. That's basically the pattern we are following. But the fact of the sanctions coming back in is effective right now, Bolton said.
A senior state department official explained that the US is providing a six-month wind-down for energy-related sanctions. So that's oil, petroleum, petrochemicals, and then all of the ancillary sanctions that are associated with that, the official said.
So, for example, banking sanctions on the Central Bank of Iran in particular because it is involved in Iran's export of oil and the receipt of revenues. Shipping, shipbuilding, ports all of those sanctions that are related to both the energy sector and then the banking and the shipping or transportation of that energy will all have a six-month wind-down period.
Everything else is going to have a 90-day wind-down. So the architecture of the Iranian sanctions programme was quite complex, but everything else includes things like dealing in the trial, providing metal precious metals and gold to the Iranian regime, providing US banknotes, the official said.
In addition, within the first 90 days, the treasury department is going to work to end terminate the specific licenses that were issued pursuant to the statement of licensing policy on civil aviation.
So treasury's going to be reaching out to those private sector companies that have licenses and work to terminate those licenses in an orderly way that doesn't lead to undue impact on the companies, the state department official said.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)
Get Latest Business News, Stock Market Updates and Videos; Check your tax outgo through Income Tax Calculator and save money through our Personal Finance coverage. Check Business Breaking News Live on Zee Business Twitter and Facebook. Subscribe on YouTube.