France: The EU's Plan to Facilitate Trade with Iran Will Have Broader Applications

The French Foreign Ministry states that the EU's special plan to enable trade with Iran, which is under U.S. sanctions, could also be used in other cases to protect the union from U.S. laws. Last month, Federica Mogherini, the EU's foreign policy chief, announced that the new financial mechanism of the union, known as 'SPV', will be implemented in November so that the union can continue its trade and financial dealings with Tehran despite Washington's sanctions. The main idea of this mechanism is for the EU to neutralize the U.S. action of punishing banks that continue to facilitate the transfer of Iran's oil revenues. Until now, it seemed that this mechanism was solely aimed at Iran, but the French Foreign Ministry stated on Thursday, October 18, in response to Reuters, that the goal of this mechanism is not just Iran, but encompasses a broader scope. Agnes von der Muehle, a spokesperson for the French Foreign Ministry, stated: 'According to European laws, the new financial mechanism should facilitate financial transactions for companies that still want to maintain their trade relations with Iran.' She added: 'Beyond all this, the aim of this mechanism is to provide a tool for the financial independence of the EU. Therefore, this is a long-term plan that will protect European companies from illegal extraterritorial sanctions in the future.' Reuters reports that many analysts and diplomats have expressed doubts about the success of this mechanism, as the United States could target even the 'SPV' by changing its sanctions laws. Gordon Sondland, the U.S. ambassador to the EU, also stated on Wednesday that the special mechanism for European countries to preserve the nuclear deal with Iran will not be effective, as international companies and businesses will not cooperate with it. Mr. Sondland said in an interview with 'Euronews' that he does not agree with the EU's approach to Iran and the union's efforts to preserve the JCPOA. Many financial institutions and large European companies such as Peugeot-Citroen, Daimler, Airbus, Eni, Maersk, and the oil company 'Total' have ended their activities in Iran for fear of U.S. sanctions. Donald Trump, the President of the United States, who withdrew the U.S. from the six-power agreement with Iran over its nuclear program on May 8, threatened this July that if European companies trade with Iran while ignoring U.S. sanctions, they will be subject to sanctions. Washington re-implemented the first round of suspended sanctions against Tehran in mid-August. The U.S. has stated that the second round of sanctions will be implemented on November 4, aiming to reduce Iran's oil exports to zero.