The long-awaited expiration of a decade long arms embargo on the Islamic Republic of Iran came into effect on 18 October 2020. This, however, is unlikely to have any material benefit for the country as the US pre-empted the end of the embargo by imposing sweeping sanctions on 18 Iranian banks.
A part of the US’s broader campaign of exerting maximum economic pressure, the sanctions are ostensibly aimed at coercing key decision makers within the Iranian regime. History tells us that aside from the main goal of isolating influential figures, sanctions targeting the financial sector have the most detrimental effect on the health and wellbeing of ordinary people. This empirical reality is likely to have particular relevance in this round of sanctions as the list of 18 banks includes Middle East Bank, the institution that controls the importation of food and medicine into Iran.
Rather than breaking the will of the theocratic elite, these sanctions will compound an on-going humanitarian crisis that has reached a crisis point during the Coronavirus pandemic and will do much to hinder the fundamental humanitarian aspirations every country should have for the health of their citizenship, as set out in Article 25 of the UN Universal Declaration on Human Rights: ‘…a standard of living adequate for the health…of himself and his family, including food…and medical care…’.
These latest restrictions, announced on 8 October, will also target foreign companies that do business with Iranian banks. Although the US have declared that humanitarian relief will be exempt from the strangulation of Iran’s financial sector, these secondary sanctions will dramatically inhibit the ability of third parties to engage with Iran in any capacity, even in these protected areas. The perception of risk and the threat of US aggression will act as a powerful disincentive for those seeking to help. These sanctions are therefore likely to disproportionately impact the most vulnerable in Iranian society.
Whilst a sustained campaign of maximum pressure inoculates the current US administration from domestic criticism, it pushes Iran further into the embrace of China and bolsters the nationalist legitimacy of the regime. Russia will continue to benefit from the gap in the oil market and augment their foreign currency reserves. These have doubled in the last five years as they have successfully adapted to their own sanctions regime. The unilateral imposition of sanctions will have important geopolitical ramifications, yet the most immediate result will be the collective suffering of the Iranian people.
Gherson has a wealth of experience in human rights matters and has acted in several sanctions cases at the General Court of the European Union. In the event that you require any advice or assistance, please do not hesitate to contact us.
The information in this blog is for general information purposes only and does not purport to be comprehensive or to provide legal advice. Whilst every effort is made to ensure the information and law is current as of the date of publication it should be stressed that, due to the passage of time, this does not necessarily reflect the present legal position. Gherson accepts no responsibility for loss which may arise from accessing or reliance on information contained in this blog. For formal advice on the current law please don’t hesitate to contact Gherson. Legal advice is only provided pursuant to a written agreement, identified as such, and signed by the client and by or on behalf of Gherson.