Iran Secondary Sanctions
The US government has clamped down on Iran with a new set of secondary sanctions. There’s a whole variety of these sanctions: those that the US regularly renews, as well as the ones that have been in place since day one. Because of this, a massive number of businessmen, company and firm owners are keenly interested in the ins and outs of all these sanctions. It’s crucial to understand how these sanctions against Iran affect inheritance matters, carrying out various financial transactions, and much more.
Secondary sanctions against Iran
Secondary sanctions on Iran are a specific type of economic sanction that’s been folded into the US government’s economic policy. As a result, anyone found to be supporting wrongdoers or terrorist organisations in any way will be hit with a list of restrictions and bans. So, all businesses, from your local startups to your medium-sized enterprises that fall foul of these sanctions, will find themselves cut off from the US financial system. This makes the whole process of forging partnerships, scouting for clients, manufacturers, and suppliers from other countries to grow one’s business a right headache. It’s important not to muddle up two key terms here – secondary sanctions and the standard set of economic sanctions (or primary sanctions). The latter have been around for donkey’s years, historically speaking.
Qualified sanctions solicitors will help you get to grips with the nitty-gritty of the various sanctions in place against Iran and other countries (jurisdictions), as well as their specific conditions. For instance, economic sanctions, also referred to as primary sanctions, apply to US citizens and anyone with ties to the United States. Such connections to the US could include, among other things: importing goods from the US, transactions conducted on US soil or falling under US jurisdiction.
Regarding secondary sanctions, they’re connected to anyone who’s doing business with sanctioned entities (that is, parties that have already been slapped with sanctions or are under sanction). These sanctions allow the US government to compile lists of various foreign individuals who’ve decided to engage in business with other entities already marked as specially designated, potentially dodgy citizens or legal bodies.
When you find yourself on the secondary sanctions list, every individual must be prepared for the fact that the US government reserves the right to select specific restrictive measures to be put into action. The choice of such measures depends on a variety of factors:
- taking into account the current programmes covered by secondary sanctions;
- Taking into account the primary directives on which the secondary sanctions were introduced.
- at the discretion of the US Secretary of State or the Treasury Secretary.
Among the most common stringent measures, it’s worth noting:
- Restrictions on conducting any business activity that a company wishes to carry out using US accounts;
- A ban on all individuals from the US engaging in business, maintaining any business relations with foreign enterprises that have been hit with sanctions.
So, secondary sanctions against Iran are referred to as quite a potent tool. The greatest effectiveness and success of these sanctions have been observed when they are combined with multilateral sanction efforts. In developing such conditions, sanctions, and other prohibitions, the US government has adhered to a strategy of complete isolation of foreign entities to prevent the possibility of doing business with Iran.
Risks of Failing to Comply with Secondary Sanctions
The most common type of sanctions employed involves placing individuals on the SDN list, that’s the Specially Designated Nationals List. This list comprises both legal entities and individuals from specific categories whose activities fully fall under the sanctions.
Landing on this list can happen to any business or organisation if 50% or more of their capital is owned by someone who’s already on the SDN list. As a result, there are certain complications in complying with sanctions legislation. These complications stem from the need to conduct a thorough check of the entire structure of the counterparty.
Under American law, breaking the rules OFAC sanctions and fines, could lead to both civil and criminal liability:
In the event of civil liability, the individual will have to pay a fine of a specific, previously stated amount or a fine twice the size of the financial transaction carried out.
In the event of criminal liability, the individual faces imprisonment. Additionally, there’s provision for responsibility in the form of secondary sanctions.
In the danger zone, it’s usually financial institutions that deal with money transfers, shifting various amounts in dollars, that find themselves at risk. Specialists at the financial company http://daybankinvest.com/ have encountered such issues while carrying out various money transfer operations.
In second place, when it comes to the level of risk, are companies and businesses that specialise in selling or buying goods and services in dollars. Moreover, the risk also affects companies involved in the purchase and sale of goods produced in the USA.
How to Comply with Secondary Sanctions?
To dodge both civil and criminal liability and to carry on with your business above board, it’s essential to adhere to the requirements and legislation concerning all the secondary sanctions the US has slapped on Iran. Specifically for this purpose, compliance programmes have been knocked up. These are essentially a set of measures and procedures designed to ensure that a company’s operations are in line with certain legislative standards.
To promptly identify any potential breaches that could land you on the list of individuals who’ve violated US sanctions, it’s advisable to carry out timely risk assessments:
- Rigorous planning and subsequent implementation of the company’s internal policy into our operations.
- staff training, employee development;
- appointing individuals who will be responsible for ensuring compliance with all the sanctions conditions;
- Continuous monitoring and auditing to promptly identify and mitigate any risks.
Developing an effective sanctions programme will be a piece of cake with the help of experienced OFAC solicitors. When it comes to managing a company or organisation, it’s crucial to consider the unique aspects of its operations. First and foremost, there’s a need to thoroughly assess the entire customer base and the nature of transactions carried out by the specific company. The risk level significantly increases if a company lacks a localized customer base, primarily due to the ever-changing roster of clients brought on by international market expansion.
In the category of companies and organisations with a high risk, all financial institutions are included, particularly those offering services such as internet banking and international money transfers. Special attention should be paid to companies that have several active branches abroad and hold correspondent accounts in foreign banks.
Faced Issues with Iran Secondary Sanctions?
If you’re having a bit of bother due to the secondary sanctions against Iran, our solicitors are on hand to offer professional legal assistance for sorting out any issue, no matter how tricky it might be. We’ve got a broad range of services in our arsenal, which we swiftly tailor to meet the individual needs and requests of each client.
Our solicitors offer representation and support to clients throughout legal proceedings related to investigations of sanction breaches. We also boast considerable experience in challenging secondary sanctions, lifting freezes on assets, and assisting in obtaining OFAC licenses for unfreezing funds or assets. Our team of experts guarantees top-notch client service, providing strong assurances of swift and successful resolution of our clients’ legal issues and challenges.
Give us a call right now to get top-notch service and quality legal support from the pros!
