EU strug­gles to find host for Iran trade mech­a­nism

Otago Daily Times - - WORLD -

BRUS­SELS/PARIS: The Euro­pean Union has so far failed to find a coun­try to host a spe­cial mech­a­nism to trade with Iran and beat newly reim­posed US sanc­tions, three diplo­mats said, as gov­ern­ments fear be­ing tar­geted by US coun­ter­mea­sures.

Voic­ing op­po­si­tion to US pol­icy on the day Wash­ing­ton an­nounced a new raft of sanc­tions on Iran, the Euro­pean Union yes­ter­day reis­sued its Novem­ber 2 state­ment say­ing it was still set­ting up the so­called spe­cial pur­pose ve­hi­cle (SPV).

The Euro­pean Union had hoped to ready its SPV, which is de­signed to cir­cum­vent the US sanc­tions, by the time of the sanc­tions an­nounce­ment by the US yes­ter­day.

No EU na­tion has so far vol­un­teered to host the en­tity, the EU diplo­mats said. Sev­eral states have been asked by EU for­eign pol­icy chief Federica Mogherini to con­sider be­ing the head­quar­ters, as the bloc tries to up­hold the arms con­trol ac­cord, which US Pres­i­dent Don­ald Trump with­drew from in May.

While the Euro­pean Com­mis­sion de­clined to com­ment yes­ter­day, Euro­pean Eco­nomic Af­fairs Com­mis­sioner Pierre Moscovici said ‘‘the Euro­pean Union does not ap­prove of’’ the reim­po­si­tion of US sanc­tions lifted un­der the 2015 nu­clear deal.

Brian Hook, Wash­ing­ton’s spe­cial rep­re­sen­ta­tive for Iran, un­der­scored the risks for Euro­pean com­pa­nies, warn­ing that any EU coun­try host­ing the SPV could po­ten­tially be sanc­tioned.

‘‘The United States will not hes­i­tate to sanc­tion any sanc­tion­able ac­tiv­ity in con­nec­tion with our Iran sanc­tions regime,’’ Hook said in a tele­phone call with Euro­pean re­porters when asked about the ve­hi­cle.

The SPV, which could in­cor­po­rate a barter sys­tem, aims to side­step the US fi­nan­cial sys­tem by us­ing an EU in­ter­me­di­ary to han­dle trade with Iran. It could en­sure, for ex­am­ple, that Ira­nian oil bought by Eu­ro­peans could be paid for with EU goods and ser­vices of the same value.

A se­nior French diplo­mat said Paris was con­fi­dent the mech­a­nism would be legally in place soon, but things needed to be fully ce­mented first. — Reuters

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