As the world seeks to come to grips with President Trump’s withdrawal from the JCPOA, it appears that the European Union will play one of its strongest cards by invoking its “Blocking Regulation“, which would prohibit European companies from complying with US sanctions against Iran. European Commission President Jean-Claude Juncker had this to say:
As the European Commission we have the duty to protect European companies. We now need to act and this is why we are launching the process of to activate the ‘blocking statute’ from 1996. We will do that tomorrow morning at 1030.
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We also decided to allow the European Investment Bank to facilitate European companies’ investment in Iran. The Commission itself will maintain its cooperation with Iran.
It remains to be seen exactly how the EU will activate the Blocking Regulation. The measure potentially could put European companies in a bind, as they could be forced to choose between compliance with the EU measure and US secondary sanctions against Iran.
More details will be available in the days to come. In the meantime, see here, here, and here for our previous commentary on the Blocking Regulation.