West of England P&I warns Iran sanctions waivers may not be repeated

Citing helpful advice from the club’s US attorneys Freehill Hogan & Mahar, it specifically highlighted advice in relation to the sanctions concerning financial transactions involving petroleum and petroleum products.

In this regard, Freehill’s advises that “…they will only apply if the President determines that there is a sufficient supply of such commodities from countries other than Iran to permit a significant reduction in the amount of petroleum and petroleum products purchased from Iran.”

This refers to the potential for some countries to be granted a waiver under the National Defense Authorization Act (“NDAA”) of 2012 to continue buying Iranian oil as long as there was evidence that there was not a sufficient supply on the world market to replace their Iranian supply. West P&I reminded that when secondary sanctions were previously in place prior to January 2016 six countries - China, India, Japan, the Republic of Korea, Taiwan, and Turkey – held such a waiver.

It warned however that there is no current indication from the US administration whether any countries will be granted a similar waiver under the re-imposed sanctions and advised: “Members should therefore assume until informed otherwise that the prohibitions on the purchase and carriage of Iranian crude oil, petroleum products and petrochemicals apply in full and without waiver”.

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West P&I also advised members take note of the caveats expressed by Freehill’s in their summary, which implied that the situation may be slightly different this time around and the US may take a tougher stance due to conflicting stances held by the EU, Russia and China. “Since the US has not been joined by the EU, Russia and China in re-imposing the pre-JCPOA sanctions, it seems likely that in order to exert maximum pressure OFAC will apply a strict interpretation of the sanctions and will enforce them with renewed vigor,” the US law firm said.

“Any parties trading with Iran should now exercise caution and carefully review the status of the US secondary sanctions against Iran to determine whether their activities may expose them to penalties,” Freehill’s concluded.