US warns EU on Instex
News agencies are reporting that the US government is warning the European Union that it faces new sanctions if it goes ahead with plans to circumvent current US sanctions against Iran through the Instex payment mechanism.
Bloomberg says it has obtained a letter from US Treasury undersecretary Sigal Mandelker that says that anyone associated with Instex could be ‘barred from the US financial system’.
The news agency reports that the letter, to Instex President Per Fischer, says: ‘I urge you to carefully consider the potential sanctions exposure of Instex. Engaging in activities that run afoul of U.S. sanctions can result in severe consequences, including a loss of access to the U.S. financial system.’
According to Bloomberg, ‘A senior official involved in the internal debate that led to the letter said the U.S. decided to issue the threat after concluding that European officials, who had earlier downplayed the significance of Instex in conversations with the Trump administration, were far more serious about it than they had initially let on. The official, who asked not to be identified discussing internal deliberations, said the letter was intended to serve as a warning that the U.S. would punish anyone associated with Instex – including businesses, government officials and staff – if they were working to set up a program to help Iran evade U.S. sanctions.’
On 21 May, the French government said that it was ’determined to see the JCPoA – central to the international non-proliferation and international security regime – implemented in full.’
It said: ‘Along with its European partners, France is continuing its efforts to preserve the economic benefits linked to the lifting of sanctions as provided by the Iranian nuclear agreement, as long as Iran respects all of its nuclear obligations. The work under way for the operational implementation of the Instex mirror company known as the Special Trade and Financing Institute (STFI) is moving forward in a positive way and should soon be completed.’