Implementation Day: Iran Sanctions Eased Today

by Dechert LLP

On Saturday, 16 January 2016, the International Atomic Energy Association (IAEA) submitted a report to the United Nations Security Council (UNSC) certifying that Iran has satisfied its obligations under the Joint Comprehensive Plan of Action (JCPOA), the agreement reached in July 2015 among Iran, the United States, China, Russia, the United Kingdom, Germany and France.1 As a result, 16 January 2016 is “Implementation Day” under the JCPOA, triggering the easing of certain sanctions against Iran by the United States, European Union and United Nations Security Council.

The sanctions relief creates a significant asymmetry between U.S. and non-U.S. persons in dealings with Iran: U.S. sanctions continue to prohibit U.S. nationals and companies from most Iranian activities (though non-U.S. subsidiaries of U.S. companies now are authorized to engage in most activities with Iran), while EU (and other non-U.S.) persons are now affected only by vastly reduced prohibitions and are largely (but not entirely) free from the threat of “secondary” U.S. sanctions. Below we summarize the timing and scope of the sanctions relief which now comes into effect. We will publish more detailed guidance in the coming days.

Timing and Scope of Sanctions Relief Forthcoming

European Union

The European Union has today published a Decision bringing EU sanctions relief into immediate effect; the nature and extent of EU sanctions against Iran are therefore now very substantially reduced.2 While certain export restrictions and an asset freeze (with many fewer targets) will remain in place, most of the EU’s prohibitions and restrictions on transactions with Iran have now been removed.

United States

In contrast with the European Union, most U.S. sanctions against Iran remain in place.3 U.S. ‘secondary sanctions’ which target non-U.S. persons who engage in certain activities largely have been lifted. However, primary sanctions (which are applicable to U.S. persons) remain in force and continue to broadly prohibit transactions with Iran, including almost all transactions conducted in U.S. Dollars. The U.S. Treasury Department has issued general licenses authorizing certain transactions with Iran – including with respect to activities of non-U.S. subsidiaries of U.S. parent companies – thereby reducing the scope of primary sanctions to a degree. In addition, a number of Iran-related individuals and entities will be removed from the Specially Designated Nationals and Blocked Persons List (SDN List). Any previously-blocked funds of such persons/entities under U.S. jurisdiction may become unfrozen, if they are not required to be blocked pursuant to other sanctions regulations.4 Non-U.S. persons will not be subject to potential penalties under remaining secondary U.S. sanctions for transacting with such persons/entities.

United Nations

United Nations sanctions are now amended, as UN Resolution 2231 (passed in July 2015) provides that all past UN Resolutions relating to Iran’s nuclear program will be terminated as of Implementation Day.5 With UNSC approval, specific restrictions will be simultaneously established in areas such as military, nuclear and missile technology. A limited asset freeze and travel ban list will remain in place. Other countries therefore are free to reduce their sanctions on Iran to align with the new (much reduced) UN requirement; it is largely expected that most will do so quickly, although some, including notably Canada, have expressly reserved their position.

Proceeding with Caution

Both U.S. and non-U.S. companies should continue to exercise caution with respect to any dealings involving Iran. All companies should ensure that any Iran-related activities are conducted in a manner fully consistent with all sanctions measures now in place. U.S. companies in particular should be aware that other than the easing of prohibitions applicable to their non-U.S. subsidiaries and other limited authorizations, Implementation Day generally has not brought any meaningful easing in U.S. sanctions applicable to their activities, notwithstanding significant changes occurring in the EU and UN.

Significantly, all companies should remain vigilant in monitoring developments relating to Iran sanctions. Sanctions eased on Implementation Day may “snap back” in the event of significant non-performance of Iran’s obligations under the JCPOA.

Further updates will follow as developments occur.


1) The IAEA Director General’s Statement on Iran may be accessed here.

2) Decision (CFSP) 2016/37 of 16 January 2016, which brings into effect Decision (CFSP) 2015/1863 and Regulation (EU) 2015/1861. The effect of this is that the current Common Foreign and Security Policy (CFSP) Decision 2010/413/CFSP and the current Regulation (EU) 267/2012 remain in force, although now substantially amended by Decision (CFSP) 2015/1863 and Regulation (EU) 2015/1861, which apply from today.

3) The US Department of Treasury’s Office of Foreign Assets Control’s (OFAC) announcement and related guidance may be accessed online. OFAC has also released updated Frequently Asked Questions in connection with the JCPOA.

4) Regardless of their removal from the SDN List, persons that OFAC previously identified as meeting the definition of the Government of Iran or an Iranian financial institution continue to meet those definitions and continue to be persons whose property and interests in property are blocked pursuant to Executive Order 13599 and section 560.211 of the Iranian Transactions and Sanctions Regulations.

5) UNSC Resolution 2231 (2015), adopted in 2015, provides that the changes were to take place automatically “upon receipt by the Security Council” of the IAEA report. Resolution 2231 also includes a snapback provision, providing for the reinstatement of sanctions in the event of significant non-performance of Iran’s obligations under the JCPOA.


DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Dechert LLP | Attorney Advertising

Written by:

Dechert LLP

Dechert LLP on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
Privacy Policy (Updated: October 8, 2015):

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.


JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at:

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.