Following the announcement of the new strategies on Iran in October 2017, on January 12, 2018, the Trump administration announced that it will continue to waive the application of certain nuclear sanctions under the Joint Comprehensive Plan of Action (“JCPOA”) as a “last chance.” In a statement, the President states that he intends to pursue a supplemental agreement with European allies of the US, and in the absence of such an agreement, the United States will ultimately withdraw from the JCPOA.
When President Trump announced that he was not going to certify Iran’s compliance with the JCPOA in October last year, Congress had 60 days to enact new legislation addressing what President Trump views as the agreement's deficiencies. This did not occur within the prescribed time. The next waiver announcement is due mid-May, and the European participants of the JCPOA will likely face diplomatic pressure to reach some kind of compromise before that.
The Trump administration has also specified terms and conditions which it envisions for the supplemental agreement and new legislation, including certain triggers that the Iranian regime cannot exceed related to ballistic missiles; a nuclear breakout period; inspection rights; and the elimination of the JCPOA's sunset clause. However, the Trump administration also expressly stated that it does not intend to negotiate with the Iranian government directly, and appears to envision that the supplemental agreement would be an agreement between the US and the EU.
On the same day, the US Department of the Treasury also announced new sanctions designations of fourteen individuals and entities in connection with serious human rights abuses and censorship in Iran, and support to designated Iranian weapons proliferators. Designated persons include the current head of the judiciary of Iran and several Chinese individuals and entities who allegedly have supplied to military-related entities in Iran. These designations are imposed outside of the JCPOA’s scope.
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© Herbert Smith Freehills 2020