6 Restrictive measures against Iran:
nuclear issues
| Committee's assessment
| Legally and politically important |
| Committee's decision | Not cleared from scrutiny; further information requested
|
| Document details | Council Decision concerning restrictive measures against Iran
|
| Legal base | Article 29 TEU; unanimity
|
| Department
Document number
| Foreign and Commonwealth Office
(36568), —
|
Summary and Committee's conclusions
6.1 As well as implementing the measures contained in UNSCR 1929
of 9 June 2010, Council Decision 2010/413/CFSP imposed additional
EU sanctions in the energy sector, the financial sector,
trade, the Iranian transport sector in particular
the Islamic Republic of Iran Shipping Line and its subsidiaries
and air cargo; and new visa bans and asset freezes,
especially on the Islamic Revolutionary Guard Corps.
6.2 Council Decision 2014/829/CFSP of 25 November
2014, amending Decision 2010/413/CFSP concerning restrictive measures
against Iran, extended the suspension of restrictive measures
specified in the Joint Plan of Action, agreed between the E3+3
and Iran, from 24 November 2014 until 30 June 2015. The full background
is set out in our most recent relevant Report,[15]
and is briefly summarised below (see paragraphs 6.9-6.13)
6.3 This Council Decision extends the expiry date
of an existing exemption to the freezing of funds and economic
resources from 31 December 2014 until 30 June 2015 and relists
one individual, Gholam Hossein Golparvar (Golparvar) and one entity,
National Iranian Tanker Company (NITC).
6.4 The Minister for Europe (Mr David Lidington)
explains that the purpose of the above exemption is to allow EU
Member States to recover debts owed by Iran: "For example,
an EU state may have paid under contract for the provision of
oil from Iran before 23 January 2012 but has not yet received
the oil from Iran" (see paragraph 6.19 below for full details).
6.5 The Minister also explains that Golparvar and
NITC had their original listings annulled following adverse General
Court judgments;[16]
the EU Council reviewed the Court judgments and the evidence basis
for the proposed new listings, and agreed that both Golparvar
and NITC should be relisted, and that these relistings should
occur in early 2015; but that due to "the confidential nature
of EU Council negotiations, and of the evidence supporting these
two relistings", he is unable to disclose detail of the evidential
basis (see paragraph 6.20 below for the reasons for the relistings).
6.6 The Minister also notes that under the Joint
Plan of Action (JPoA) agreed by the E3+3 and Iran in November
2013, and recently extended until 30 June 2015, the E3+3 is able
to maintain pressure on Iran; and that these relistings are thus
consistent with the principles agreed as part of the JPoA.
6.7 We draw these developments to the attention
of the House because of the importance of these measures and of
ensuring that they are properly implemented.
6.8 We note that the judgment annulling restrictive
measures against Gholam Golparvar was delivered as long ago as
12 December 2013 (and not earlier in 2014 as stated by the Minister),
and the judgment in respect of the National Iranian Tanker Company
on 3 July 2014. In each case the General Court maintained the
effect of the relevant legislation for a further period, which
provided an opportunity for the relisting to be made without a
break in the continuity of the restrictive measures. These periods
appear to have expired. If this is indeed the case we ask the
Minister why the opportunity was not taken to maintain continuity,
and whether the delay in relisting has had any adverse effect
of the effectiveness of the restrictive measures.
Full
details of the documents: Council Decision
amending Council Decision 2010/413/CFSP concerning restrictive
measures against Iran: (36568), —.
Background
6.9 As the Committee's previous Reports illustrate
in detail, the EU has been engaged since December 2006 in a "dual
track" strategy — with both engagement and restrictive
measures — regarding Iran's nuclear activities, not simply
implementing in the EU, but also strengthening in that context,
successive UN Security Council Resolutions (UNSCRs).
6.10 UNSCR 1929 of 9 June 2010 imposed a number of
further restrictive measures which in broad terms:
— reaffirmed
that Iran shall cooperate fully with the IAEA;
— banned new Iranian nuclear facilities
and banned Iranian nuclear investment in third countries;
— banned exports of several major categories
of arms, and further restricted Iran's ballistic missile programme;
— froze the assets of 40 entities, including
one bank subsidiary, several Islamic Revolutionary Guard Corps
companies, and three Islamic Republic of Iran Shipping Lines subsidiaries,
which had been involved in multiple sanctions violations cases;
— froze the assets of, and banned travel
by, one senior nuclear scientist;
— implemented a regime for inspecting suspected
illicit cargoes and authorising their seizure and disposal;
— placed restrictions on financial services,
including insurance and reinsurance, where there was suspicion
of a proliferation link;
— banned existing and new correspondent
banking relationships where there were proliferation concerns;
— established a Panel of Experts to advise
and assist on sanctions implementation; and
— reaffirmed the dual track strategy (of
pressure and diplomacy).
Council Decision 2010/413/CFSP
6.11 As well as implementing the measures contained
in UNSCR 1929, the EU imposed additional EU sanctions in the following
areas:
— the
energy sector, including the prohibition of investment,
technical assistance and transfers of technologies, equipment
and service;
— the financial sector, including
additional asset freezes against banks and restrictions on banking
and insurance;
— trade, including a broad ranging
ban on dual use goods and trade insurance;
— the Iranian transport sector in
particular the Islamic Republic of Iran Shipping Line (IRISL)
and its subsidiaries and air cargo; and
— new visa bans and asset freezes,
especially on the Islamic Revolutionary Guard Corps (IRGC).
6.12 Council Decision 2010/413/CFSP was adopted by
the 26 July 2010 Foreign Affairs Council, together with a Regulation
(Council Regulation (EU) 961/2010) extending the list of entities
and individuals subject to an assets freeze.
6.13 A further package of EU sanctions was adopted
by the 15 October 2012 Foreign Affairs Council. The Committee
cleared the relevant Council Decision on 31 October 2012. The
Council Regulation required to implement the October package was
adopted on 21 December 2012. It includes:
· Finance:
a financial cut-off, prohibiting all but specifically licensed
trade with a notification system for humanitarian payments up
to €100,000 and other payments (€40,000); a full listing
of the Central Bank of Iran except to permit channels for the
provision of liquidity and repayment of debts; a full ban on the
public provision of export credit guarantees (adding short term
to the already prohibited medium and long term);
· Energy
sector: a gas embargo: a further ban on
exporting equipment for the Iranian Energy Sector; a ban on construction
of oil tankers;
· Trade:
bans on exporting graphite and metals that can be used in Iran's
nuclear programme; naval equipment for ship building and maintenance;
software for integrating industrial processes;
· Transport:
bans on the flagging and classification of Iranian oil tankers
and cargo vessels; and on the leasing/chartering of vessels for
the transport or storage of Iranian oil; and
· New
Designations: the Council Decision and
Council Implementing Regulation imposed an asset freeze on further
Iranian companies and updated the entries for three already listed
entities.[17]
6.14 On 24 November 2013 in Geneva, the Foreign Ministers
of the E3+3 (China, France, Germany, Russia, the United Kingdom
and the United States), supported by the EU High Representative,
reached an agreement with Iran — the Joint Plan of Action
(JPoA). The 17 January 2014 EEAS Fact Sheet on the negotiations
describes the JPoA thus:
"The Joint Plan of Action is an interim
agreement setting out an approach towards reaching a long-term
comprehensive solution. As a first step, it includes the implementation,
by both sides, of a series of voluntary measures, for a duration
of six months. This first step could be renewed by mutual agreement.
"A Joint Commission of the E3/EU+3 and Iran
will be established to monitor the implementation of these measures,
with the IAEA responsible for the verification of nuclear-related
measures. The Joint Plan of Action also includes elements for
the final step — i.e. the common goal of reaching a final,
comprehensive solution which would lead to the full resolution
of the international community's concerns about Iran's nuclear
programme, along with UN Security Council resolutions."[18]
6.15 The E3+3 and Iran first agreed on 19 July 2014
to extend the JPoA for a further four months until 24 November
2014, i.e., the anniversary of agreement on the JPoA. Both sides
agreed to continue to implement all measures agreed under the
Geneva interim deal that had not yet expired, which meant that
the limited sanctions relief under the JPoA would remain in place
until 24 November 2014.[19]
In summary:
· the
US agreed to pause efforts to reduce crude oil sales to Iran's
oil customers, repatriate an amount to be agreed of oil revenue
held abroad, and suspend oil-related insurance and transport costs;
· the
EU and US agreed to suspend sanctions on petrochemical exports,
and sanctions on imports of gold and precious metals;
· the
US agreed to suspend sanctions on the auto industry, and allow
licensing on the civil aviation sector;
· no new
nuclear-related sanctions would be implemented by the UN, EU and
US Administration;
· the
US agreed to establish a financial channel to facilitate humanitarian
and legitimate trade, including for payments to international
organisations, and for Iranians studying abroad; and
· the
EU agreed to increase the thresholds for authorisation of financial
transactions for humanitarian and non-sanctioned trade.[20]
6.16 It was hoped that this would provide the additional
time needed to conclude an agreement. However, on 24 November
2014, the then EU High Representative and the Iranian Foreign
Minister issued a statement noting that: while some ideas
had been developed, more work was required to assess and finalize
them as appropriate; they, together with the Foreign Ministers
of the E3+3, had therefore agreed to continue these diplomatic
efforts; and it had accordingly been decided to extend the measures
of the Joint Plan of Action to allow for further negotiations
until 30 June 2015.[21]
Council Decision 2014/829/CFSP of 25 November
2014
6.17 This Council Decision extended the suspension
of restrictive measures specified in the Joint Plan of Action,
agreed between the E3+3 and Iran until 30 June 2015.
6.18 We cleared it from scrutiny at our meeting on
10 December 2014.[22]
The draft Council Decision
6.19 In his Explanatory Memorandum of 15 December
2014, the Minister for Europe (Mr David Lidington) explains the
draft Council Decision thus:
EXEMPTION EXTENSION
"The current EU Iran Decision (2010/413/CFSP)
allows an exemption to the general EU oil embargo where a transaction
pertains to a contract concluded before 23 January 2012, and where
the proceeds from the supply of such oil is for reimbursement
of outstanding amounts (Article 3(c)2). The legislation also
provides that the asset freeze should not apply to such transactions
as referred to above until 31 December 2014 (Article 20(14)).
The Council has decided that this date should be extended to 30
June 2015, in line with the extension of the Joint Plan of Action
(JPoA) agreed between the E3+3 and Iran.
"The purpose of the above provision is to allow
EU Member States to recover debts owed by Iran. For example,
an EU state may have paid under contract for the provision of
oil from Iran before 23 January 2012 but has not yet received
the oil from Iran."
The Government's view
6.20 The Minister says:
"The amendment of this provision is not
directly related to the sanctions relief as part of the Joint
Plan of Action agreed with Iran. This provision does not
alter the level of pressure on Iran, and indeed the shipments
of oil under this provision take resources away from Iran, and
give them to the EU (Iran will be exporting oil for which it has
already received payment). It allows for the continued application
of an exemption that has existed throughout the period of the
Joint Plan of Action. For these reasons HMG supports the
amendment.
RELISTINGS
"Golparvar and NITC had their original listings
annulled following adverse General Court judgments earlier this
year. The EU Council reviewed the Court judgments and the evidence
basis for the proposed new listings. The EU Council agreed that
both Golparvar and NITC should be relisted, and that these relistings
should occur in early 2015. Due to the confidential nature of
EU Council negotiations, and of the evidence supporting these
two relistings, it is not possible to disclose detail of the evidential
basis.
"The statement of reasons for NITC's relisting
reads: "The National Iranian Tanker Company provides financial
support to the Government of Iran through its shareholders the
Iranian State Retirement Fund, the Iranian Social Security Organization,
and the Oil Industry Employees Retirement and Savings Fund, which
are State-controlled entities. Moreover, NITC is one of the largest
operators of crude oil. Accordingly NITC provides logistical support
to the Government of Iran through the transport of Iranian oil.
"The statement of reasons for Golparvar's relisting
reads: "Mr Golparvar acts on behalf of IRISL and companies
associated with it. He has been commercial director of IRISL,
as well as Managing Director and shareholder of the SAPID Shipping
Company, non-executive director and shareholder of HDSL, and shareholder
of Rhabaran Omid Darya Ship Management Company, which are designated
by the EU as acting on behalf of IRISL."
The Government's view
6.21 The Minister says:
"Under the Joint Plan of Action (JPoA) agreed
by the E3+3 and Iran in November 2013 and recently extended until
30 June 2015, the E3+3 is able to maintain pressure on Iran. These
relistings are thus consistent with the principles agreed as part
of the JPoA."
Previous Committee Reports
None, but see Twenty-fifth Report HC 219-xxiv (2014-15),
chapter 15 (10 December 2014); Ninth Report HC 219-ix (2014-15),
chapter 41 (3 September 2014); also see (35964) —
and (35965) —: Forty-seventh Report HC 86-xlii (2012-13),
chapter 11 (30 April 2014) and (35712) 18163/13: Thirty-first
Report HC 83-xxviii (2013-14), chapter 15 (22 January 2014),
and the earlier Reports referred to therein.
15 See (36529), -: Twenty-fifth Report HC 219-xxiv
(2014-15), chapter 15 (10 December 2014). Back
16
Cases T-565/12 and T-58/12. Back
17
For the full background, see the European External Action Service
(EEAS) fact sheet on the European Union and Iran. Back
18
See http://eeas.europa.eu/statements/docs/2013/131219_02_en.pdf.
Back
19
See the "Background" section in Twenty-fifth Report
HC 219-xxiv (2014-15), chapter 15 (10 December 2014) for full
details of the commitments entered into by Iran on the one hand
and the EU and USA on the other. Back
20
Also see Ninth Report HC 219-ix (2014-15), chapter 41 (3 September
2014). Back
21
See http://eeas.europa.eu/statements-eeas/2014/141124_02_en.htm.
Back
22
See Twenty-fifth Report HC 219-xxiv (2014-15), chapter 15 (10
December 2014). Back
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