South Korea set to resume humanitarian exports to Iran under new OFAC licence
South Korea is gearing up to resume humanitarian exports to Iran under a special licence published by the US Office of Foreign Assets Control (‘OFAC’), with shipments likely to begin in May.
South Korea’s Yonhap news agency quoted a foreign ministry official as saying that exports will resume under General License No. 8, issued by OFAC in late February to authorise certain humanitarian transactions with the Central Bank of Iran (‘CBI’), which is targeted by US sanctions.
‘On April 6, the humanitarian export process based on the General License No. 8 got under way,’ the unidentified official said. ‘Our companies and banks should prepare documents needed to carry out enhanced due diligence, and we think that the shipments may begin about a month later.’
The official was quoted as saying that, apart from trading under the OFAC licence, South Korea is also pushing for the Korean Humanitarian Trade Arrangement (‘KHTA’), which uses an Iranian bank free from US sanctions – such as the Middle East Bank – to facilitate humanitarian transactions with the Islamic Republic.
Korea is also exploring how to tap to into the Swiss Humanitarian Trade Arrangement (‘SHTA’), a payment gateway designed for exports to Iran by Switzerland-based companies, according to the state-run news agency.
‘South Korea is pushing for all three methods,’ the official said. He noted that the General License No. 8 platform appeared to be the fastest way to resume humanitarian exports to Iran, which has faced shortages of medicines and equipment to fight the pandemic due to US sanctions.
Although Washington insists that humanitarian exports are not subject to the embargo on Iran, Yonhap said that South Korean firms had been hesitant to resume such sales for fear of breaching the sanctions.