TRUMP ADMINISTRATION RE-IMPOSES IRAN SANCTIONS
September 7, 2018
On May 8, 2018, President Trump announced that the United States would withdraw from the Iran Nuclear Deal, and re-impose certain sanctions through Executive Order 13846 – which took effect after a wind-down period on August 6, 2018.
The re-imposed sanctions include, notably, blocking financial transactions and the imports of raw materials, as well as severe restrictions on commercial aircraft purchases by Iranian entities. Years of U.S. sanctions have prevented Iran from investing in new jets or purchasing aircraft parts, which has contributed to the country’s poor aviation record. The U.S. Office of Foreign Asset Control (OFAC) will still consider related license applications for the export, re-export, sale, lease, or transfer of commercial passenger aircraft and related parts under much more limited “aircraft safety” licensing policy:
“Specific licenses may be issued on a case-by-case basis for the exportation or re- exportation of goods, services, and technology to insure the safety of civil aviation and safe operation of U.S.-origin commercial passenger aircraft.”
In addition, General License “J” authorizes non-U.S. airlines to fly U.S. origin aircraft into Iran for stays of up to 72 hours, commonly known as the sojourner exception. Despite the revocation of certain general licenses following the U.S.’s withdrawal from the Iran Nuclear Deal, it does not currently appear that OFAC intends to revoke General License J. Thus, carriers can still operate scheduled service under the “sojourner exception”, but cannot wetlease to an Iranian entity or wetlease to another non-Iranian airline operating to Iran.
If you have any questions, please contact Evelyn Sahr (esahr@eckertseamans.com or 202-659-6622); Drew Derco (dderco@eckertseamans.com or 202-659-6665), or Alexander Matthews (amatthews@eckertseamans.com or 202-659-6633).
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