After Washington pulled out from the 2015 Joint Comprehensive Plan of Action (JCPOA), the Iran nuclear deal, and reimposed sanctions on Tehran, the European Union (EU) is now looking for viable solutions so that trade ties between the block and Iran will not be crushed. At the moment, the Union is working on setting up a “legal entity” to facilitate legitimate financial transactions with Iran.

“The participants welcomed practical proposals to maintain and develop payment channels, notably the initiative to establish a Special Purpose Vehicle to facilitate payments related to Iran’s exports — including oil — and imports, which will assist and reassure economic operators pursuing legitimate business with Iran”, said EU’s foreign and security policy chief Federica Mogherini to reporters in New York, where she is attending the 73rd UN General Assembly, adding that the same solution might be adopted also by Russia and China.

The chief EU official elaborated the plan, explaining that, “In practical terms this will mean that EU member states will set up a legal entity to facilitate legitimate financial transactions with Iran.”

“The participants considered ways forward to ensure the full and effective implementation of the JCPOA in all its aspects (…) They also took stock of the process of finding and operationalizing practical solutions for issues arising from the unilateral withdrawal of the United States from the agreement and the re-imposition of sanctions”, continues the statement read to reporters by Mogherini.

However, fearing the repercussions, French Total, Peugeot, Renault, Siemens and Daimler have left Iran immediately after news reached them.

“Being aware of the critical nature of the situation and the need for tangible results, the participants welcomed the proposals on the maintenance and development of communication channels and the flow of payments, namely the initiative to set up a dedicated network to facilitate payments related to Iran’s oil exports”, Britain, China, France, Germany, Russia and the EU announced in their joint statement.

At present, EU’s main objective is to protect European businesses based in Iran, protect them from U.S. sanctions, due to enter into force in November, and prevent these companies from leaving the country.

Source: Nefeli Tzanetakou/balkaneu