WASHINGTON - The U.S. Treasury Department clarified on Tuesday the process in which sanctions on Iran's economy will be reinstated following U.S. President Donald Trump's decision to withdraw from the Iran nuclear deal.
Most of the sanctions won't be reinstated immediately, but over a period of several months so companies that have signed contracts in Iran after the deal's implementation can "phase out" of their operations in the Islamic Republic, as one senior U.S. official explained.
A significant amount of American sanctions were lifted from Iran's economy after the deal was signed. The lifting of those sanctions paved the way for American and international companies to sign business contracts in Iran and invest money into projects involving Iranian companies. All of those sanctions will be reestablished by the end of 2018 following Trump's declaration.
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The first batch of sanctions will be put back in place in August 2018. These will include, among others, sanctions on the acquisition of U.S. dollar banknotes by Iran's government; sanctions on Iran's trade in gold and other precious metals; sanctions on direct or indirect sale, supply or transfer of aluminum, steel, coal and graphite to Iran; and sanctions on Iran's automotive sector.
There will also be a renewal of sanctions limiting the importation of rugs from Iran into the United States.
The Treasury Department stated that "persons engaging in the activities listed above...should take the steps necessary to wind down those activities by August 6, 2018, to avoid exposure to sanctions or an enforcement action under U.S. law."
Many companies will probably terminate their activities in Iran before that date, which is the last date to do so without facing heavy punishments.
The second batch of sanctions will be put back in place by November 2018. These include, among others, sanctions on Iran's shipping sector; sanctions on Iran's petroleum exports; sanctions on the Central Bank of Iran, and broader sanctions on Iran's energy sector.
Sanctions on Iranian individuals that were lifted after the Iran deal will also be reinstated by November, and possibly earlier.
The Trump administration described the period until the sanctions will be reimposed as a "wind-down" period, created in order to allow the companies to minimize their damages and end their operations in Iran.
"The U.S. government has a past practice of working with U.S. or third-country companies to minimize the impact of sanctions on the legitimate activities of those parties undertaken prior to the imposition of sanctions," the Treasury Department explained on its website.
"The deal lifted crippling economic sanctions on Iran, in exchange for very weak limits on the regime's nuclear activities," Trump said, adding that the deal "should have never been made. It didn't bring peace, and it never will."