France, Germany and Britain are working closely with EU officials on the finance tool ahead of November’s restoration of a second wave of US sanctions that will target Iran’s oil exports and transactions with its central bank. An official EU effort to maintain financial access to Iran would deepen a transatlantic rift after Washington warned European companies to comply with its reimposed countermeasures or be shut out of the US financial system.
The goal of European policymakers is to help both EU and Iranian businesses preserve the commercial benefits that are part of the 2015 nuclear agreement, known as JCPOA.
The European troika of France, Germany and Britain — which are all signatories to the nuclear deal, along with Russia and China — have been working with the European Commission and the EU’s diplomatic service on the planned funding channel, the Financial Times reported.
Various ideas on how to structure the mechanism are still under consideration. “There has not been a political decision yet on what precise form an independent financing facility could take, but there has been an acceleration in the intensity of work,” a spokesperson for the French minister of finance said.
French finance minister Bruno Le Maire
The French government has long pushed the need for an alternative financing mechanism that would allow trade with Iran to continue in the face of US sanctions. Paris now believes that interest in the project, particularly from Germany, has increased ahead of the November deadline for Washington’s latest measures against Tehran. The Germany finance ministry said: “The consultations on this are intensive and they continue. There are different models on the table.” The UK Foreign and Commonwealth Office said the UK and the EU were “currently undertaking discussions to find practical solutions to support continued economic relations with Iran, consistent with the nuclear deal”.
It is unclear whether the proposed channel could be used for payments for Iranian oil, or whether the channel would only be used to pay for trade in other goods and services. Maja Kocijancic, an EU spokesperson, told reporters on Friday that efforts were continuing to sustain co-operation with Iran in key economic sectors, including oil. Part of the work was to ensure that companies doing legitimate business with Iran could still “have access to the necessary finance”, she added.
