The United States on Thursday expanded its sanctions framework on Iran to cover the country’s automotive and rail sectors, while separately adding major Iranian automakers, railway companies and related businesses to its sanctions blacklist.
The US Treasury said the determination brought Iran’s automotive and rail sectors under its sanctions framework, allowing Washington to impose blocking sanctions on people or entities determined to operate in those sectors.
The measure took effect on October 1.
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The Treasury said the determination was aimed at addressing what Washington described as an “unusual and extraordinary threat” to US national security, foreign policy and the economy.
OFAC, the Treasury’s sanctions arm, also updated its Specially Designated Nationals (SDN) List with a number of Iran-linked entities.
Major Iranian automakers targeted
Among the companies added under the new automotive-sector sanctions were Iran Khodro, Iran Khodro Diesel, Pars Khodro, Saipa and Zamyad.
The list also included Niroo Motor Damavand and Niroo Motor Shiraz, along with Heavy Equipment Production Company (HEPCO) and its Shanghai-linked trading entity.
The designations extended beyond Iran. OFAC also named companies based in Hong Kong, China, the UAE, Indonesia, Germany and Turkey under the Iran sanctions programme.
Rail companies also sanctioned
The US also targeted several Iranian railway entities, including the Islamic Republic of Iran Railway Company, Raja Passenger Trains Company and Railway Transportation Company.
The action therefore covered both the production side of Iran’s vehicle industry and key companies involved in the country’s rail network.
Being placed on OFAC’s SDN List generally means that property and interests in property of the designated entity within US jurisdiction are blocked, while US persons are generally prohibited from dealing with designated parties unless authorised by OFAC. The sanctions framework can also create exposure for certain non-US persons and foreign financial institutions involved in significant transactions with designated Iranian entities.
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Not all auto, rail companies automatically sanctioned
The move did not mean every company operating in Iran’s automotive and rail sectors was automatically sanctioned. Instead, it gave the US the authority to impose sanctions on companies and individuals operating in those sectors, while OFAC separately named specific entities and people for sanctions.
The latest action also included two individuals and several companies linked to Iran’s commercial networks under separate US sanctions rules covering the country’s metals sector.
The US has used several sanctions measures to target different parts of Iran’s economy, including its energy, metals, automotive and rail sectors.
