On the heels of a July Presidential Order authorizing additional sanctions, President Obama signed into law the Iran Threat Reduction and Syria Human Rights Act of 2012 on August 10, 2012.
The tough new measures target in particular non-U.S. companies that do business with Iran. From law firm Skadden Arps:
“The Act is the U.S. government’s latest response to Iran’s illegal nuclear program and the situation in Syria, and it reflects an intensified effort to counter perceived efforts by non-U.S. companies to help Iran in particular evade existing U.S. economic sanctions… The Act further expands the scope of the Iran Sanctions Act (ISA), as amended by the Comprehensive Iran Sanctions, Accountability, and Divestment Act of 2010 (CISADA), by expanding the sanctions imposed by the ISA and by imposing new sanctions, including sanctions targeting persons that (1) issue or purchase Iranian sovereign debt; (2) enter into joint ventures with the Government of Iran to develop petroleum resources outside of Iran; (3) construct infrastructure that can be used to transport Iran’s energy products; (4) support Iran’s production of petrochemical products; and (5) own, operate or insure vessels used to transport crude oil out of Iran.”
The latest actions strengthen the U.S. position on Iran in unprecedented ways. Law firm Orrick:
“First, they take the embargo on Iran-related activity by U.S. companies and individuals about as far as it can go. Second, they expand the types of activity by non-U.S. companies and individuals that can trigger secondary boycott sanctions by the U.S. government. Secondary boycott sanctions are sanctions imposed extraterritorially against particular non-U.S. companies and individuals in response to specified types of activity related to Iran. Secondary boycott sanctions do not involve traditional civil or criminal penalties but instead are measures designed to prevent non-U.S. persons from accessing the U.S. market or conducting business with U.S. persons. In this way, the U.S. ‘boycotts’ these entities based on their involvement with Iran.”
Read the updates:
• New Sanctions Against Iran: President Obama Signs the Iran Threat Reduction and Syria Human Rights Act of 2012 - Skadden, Arps, Slate, Meagher & Flom LLP
• United States Extends and Tightens Iran Sanctions - Orrick, Herrington & Sutcliffe LLP