In this Saturday, Sept. 22, 2018, file photo, European Union foreign policy chief Federica Mogherini speaks at a news conference during a meeting of Women Foreign Ministers in Montreal. Five world powers and Iran agreed late Monday, Sept. 24, 2018, to establish a financial facility in the European Union to facilitate payments for Iranian imports and exports including oil, a key move sought by Tehran following the U.S. pullout from the 2015 nuclear deal and its re-imposition of sanctions. Mogherini told reporters after the closed-door ministerial meeting that the financial facility is also aimed at preserving the nuclear agreement. (Graham Hughes/The Canadian Press via AP)

In this Saturday, Sept. 22, 2018, file photo, European Union foreign policy chief Federica Mogherini speaks at a news conference during a meeting of Women Foreign Ministers in Montreal. Five world powers and Iran agreed late Monday, Sept. 24, 2018, to establish a financial facility in the European Union to facilitate payments for Iranian imports and exports including oil, a key move sought by Tehran following the U.S. pullout from the 2015 nuclear deal and its re-imposition of sanctions. Mogherini told reporters after the closed-door ministerial meeting that the financial facility is also aimed at preserving the nuclear agreement. (Graham Hughes/The Canadian Press via AP)

UNITED NATIONS (AP) — Five world powers and Iran agreed late Monday to establish a financial facility in the European Union to facilitate payments for Iranian imports and exports including oil, a key move sought by Tehran following the U.S. pullout from the 2015 nuclear deal and its re-imposition of sanctions.

Foreign ministers from Britain, France, Germany, Russia, China and Iran said in a joint statement that the so-called “Special Purpose Vehicle” will “assist and reassure economic operators pursuing legitimate business with Iran.”

The nuclear agreement is meant to prevent Tehran from developing nuclear weapons, but U.S. President Donald Trump announced in May he was unilaterally pulling out because he felt it wasn’t strong enough and didn’t cover other issues of concern to the U.S. and its allies, such as Iran’s military influence in the Middle East and ballistic missile program. The U.S. has also accused Iran of promoting international terrorism, which Tehran vehemently denies.

Iran’s economy is already suffering from the sanctions that Washington re-imposed after walking away from the nuclear agreement, and the U.S. has threatened to punish companies from other nations that continue doing business with Iran.

In sharp contrast, the five other world powers who signed the nuclear deal remain strongly committed to it, and the new financial facility is almost certain to anger the Trump administration.

European Union foreign policy chief Federica Mogherini told reporters after the closed-door ministerial meeting that the financial facility is also aimed at preserving the nuclear agreement. The EU and Iran say the deal is working, and the joint statement notes that the International Atomic Energy Agency has now certified 12 times that Iran is in compliance with its obligations.

“In practical terms,” Mogherini said, “this will mean that EU member states will set up a legal entity to facilitate legitimate financial transactions with Iran and this will allow European companies to continue to trade with Iran in accordance with European Union law and could be open to other partners in the world. ”

She said the agreement follows extensive exchanges and announced that a meeting of technical experts will be held to “operationalize” the new financial facility.

The joint statement said the six countries that signed the 2015 nuclear agreement “reconfirmed their commitment to its full and effective implementation in good faith and in a constructive atmosphere.” They called the agreement “a key element of the global non-proliferation architecture and a significant achievement of multilateral diplomacy.”

The participants reaffirmed their joint statement on July 6, “in particular to pursue concrete and effective measures to secure payment channels with Iran.” </s> Senior diplomats from Iran and five world powers are meeting in Vienna on May 25 to try to prevent the 2015 nuclear deal from collapsing after the United States pulled out of the agreement and reinstated sanctions against Iran this month.

Iranian leaders have said they will uphold their side of the deal, which involves strict curbs on their nuclear program, if Britain, France, Germany, Russia, and China uphold theirs by making sure that Iran can keep doing business with the world, despite the revived U.S. sanctions.

"It won't be easy, but we'll try," Iranian Deputy Foreign Minister Abbas Araqchi said ahead of the talks.

Iranian ministers are under orders from Supreme Leader Ayatollah Ali Khamenei to seek guarantees from the Europeans for Iranian oil sales and trade, as well as their agreement to spurn U.S. efforts to negotiate a stronger and broader deal with Tehran.

Khamenei laid out a series of conditions on May 23 that he said must be met for Iran to stay in the deal.

The European powers are expected to highlight EU efforts to legally shield European companies that have established ties with Iran from the U.S. sanctions so they can continue doing business in Iran.

Diplomats said the European Union is trying to make sure that such businesses are not affected in particular by U.S. sanctions prohibiting Iran from using the U.S. dollar or U.S. financial institutions to transact business.

Iranian officials are expected to carefully scrutinize the package of measures EU officials have cobbled together to try to counter the U.S. sanctions.

Some European officials have been openly skeptical that the measures will be effective in keeping businesses from fleeing Iran. Several major corporations, including France's Total and Germany's Allianz, already have announced they are leaving unless they receive exemptions from the U.S. sanctions.

"I think this is a moment of truth for the Europeans," EU chief diplomat Federica Mogherini said this week.

The meeting of foreign ministers is the first since U.S. President Donald Trump on May 8 abandoned the deal, formally named the Joint Comprehensive Plan of Action (JCPOA), which originally provided near-universal sanctions relief in exchange for curbs on Iran's nuclear activities.

In pullng out, Trump argued that the agreement would not stop Iran from eventually developing atomic warheads, and that it did nothing to check Iran's ballistic missile program or its involvement in regional conflicts in Yemen and Syria.

European and Russian leaders say the deal has accomplished its goal of preventing Iran from developing nuclear weapons while contributing to stability in the Middle East.

With reporting by dpa and Reuters </s> Paris/Vienna/Brussels/Dubai: The European Union asked for exemptions from expected US sanctions on Iran and the bloc’s lending arm balked at supporting Iranian projects, signs of the mounting difficulties in meeting a political pledge to stick with the landmark nuclear deal after President Donald Trump quit the accord.

The troubles emerged as a senior Iranian envoy demanded results from EU negotiations “very soon” and said a failure to provide economic guarantees would result in the resumption of Tehran’s nuclear activities. That threat quickly drew warnings from the US.

France, Germany, Britain and the EU as a whole are seeking a sanctions reprieve from Washington a month after Trump withdrew from the nuclear pact and vowed to sanction companies doing business with Iran, which holds the world’s second-biggest natural gas reserves. The EU has pledged to defend the agreement, protect European companies negatively affected by the US decision and offer alternate financing for Iranian investments.

“As allies, we expect that the U.S. will refrain from taking action to harm Europe’s security interests,” the three countries and the EU said in a letter to the US administration. In it, they argued that the accord with Iran remains the best way to prevent a nuclear-armed Iran and that the 2015 accord can only survive if Tehran receives economic benefits in return.

“U.S. secondary sanctions could prevent the EU from continuing meaningful sanctions relief to Iran,” they said.

In a sign of internal EU conflict, the bloc’s executive arm proposed on Wednesday that the European Investment Bank expand its lending remit to cover Iran, a plan EIB president Werner Hoyer immediately rejected as being risky and unwise.

The European Commission idea to let the EIB support Iranian projects could hamper the lender because around 30% of its €500 billion ($589 billion) in outstanding debt is denominated in dollars, said Hoyer.

“With this lever, the U.S. administration might have the tool to threaten the business model of the bank,” Hoyer said by phone from Luxembourg, where the EIB is based. “We are a capital markets-based institution, which differentiates us from all other EU institutions.”

He said the bloc’s national governments, which own the EIB, will likely heed its advice against lending for Iranian projects and urged the bloc to come up with “more intelligent” ways to keep the nuclear accord intact.

“We are not the right tool,” said Hoyer, who called the Iran deal one of the EU’s “major and finest” diplomatic achievements.

The letter from the EU countries was sent on 4 June to treasury secretary Steven Mnuchin and secretary of state Mike Pompeo, and was posted on the Twitter account of French finance minister Bruno Le Maire.

“As close allies we expect that the extraterritorial effects of U.S. secondary sanctions will not be enforced on EU entities and individuals, and that the U.S. will thus respect our political decision and the good faith of economic operators within EU legal territory,” the letter said.

Even before the US pulled out of the JCPOA, many European companies faced problems financing their Iranian investments because major banks didn’t want to risk US ire by working in Iran.

Some companies aren’t waiting to find out. France’s PSA Group, the maker of Peugeot and Citroen cars, said Monday it’s suspending its push into Iran, and has begun closing its joint ventures with Iranian carmakers. French energy companies Total SA and Engie SA have also said they’d stop some operations in Iran.

The window for the EU to convince Tehran to stay in the deal is quickly narrowing. Iran’s International Atomic Energy Agency (IAEA) ambassador, Reza Najafi, said on Wednesday in Vienna that he expects results from negotiations with the EU soon. The Persian Gulf country told inspectors they’re preparing uranium-enrichment feedstock and facilities to produce new centrifuges if the talks intended to save the Joint Comprehensive Plan of Action fail.

“They need to ensure that Iran is compensated unconditionally,” according to Najafi, who said Iran received “strong support from the overwhelming majority” of the 35 IAEA members meeting this week in the Austrian capital.

Until measures are worked out, IAEA inspectors shouldn’t count on any additional cooperation by Iran, Najafi said. The agency’s director general Yukiya Amano said on Monday that Tehran could do even more to facilitate verification, even after monitors called a record number of snap visits last year.

“As long as Iran isn’t benefiting from the deal, nobody should expect Iran to implement even more voluntary measures,” the envoy said. The IAEA reported for an 11th time this week that Iran has kept it’s side of the bargain by keeping its nuclear activities below allowable thresholds.

On Wednesday, Iran’s state television aired a live interview with Ali Akbar Salehi, head of Iran’s Atomic Energy Organization, from a centrifuge assembly center at the Natanz facility. Salehi, dressed in a white coat, spoke of Iran’s nuclear program and efforts to develop the technology as a pride-inducing project and an investment that had cost the nations some $6 billion over three decades.

Salehi said that his nation was working on developing the assembly center, which could if needed host newer, more efficient centrifuges. He reiterated that Iran would for the time being respect all limitations imposed by the nuclear accord. “We hope not to see a day’ when the nuclear deal falls apart, Salehi said.

Comments about boosting enrichment capacity prompted US secretary of state Mike Pompeo to issue a warning on Wednesday.

“We’re watching reports that #Iran plans to increase its enrichment capacity,” Pompeo wrote on Twitter. “We won’t allow Iran to develop a nuclear weapon. Iran is aware of our resolve.” </s> PARIS/WASHINGTON/BRUSSELS - US officials are touring the globe to pressure countries to shun trade with Iran following Washington's withdrawal from a nuclear deal between Tehran and world powers, a move that undermines European efforts to save the accord, sources said.



US State and Treasury Department officials have traveled to Japan and this week US diplomats are in eastern Europe as Britain, France and Germany scramble to save the 2015 pact and convince Iran that they can continue to do business with Tehran.





"The Americans are on a roadshow and going everywhere. They are dogmatic," said a senior European diplomat. "We were clear and told them: if you are coming to tell to us how to apply American laws here then you're not welcome," the diplomat said.Ministers from the three European nations and the EU foreign policy chief have written to US counterparts urging them to protect EU companies working in Iran from getting caught up in Washington's new sanctions on the Islamic Republic.In the June 4 letter, the foreign and finance ministers singled out areas where they expected exemptions for EU firms, including pharmaceuticals, healthcare, energy, automotive, civil aviation, infrastructure and banking.The letter appeared to accept that despite their efforts to circumvent secondary sanctions, the US action could prevent the EU from continuing "meaningful sanctions relief to Iran."The US roadshow suggests there is little appetite in Washington to compromise."We will hold those doing prohibited business in Iran to account," US Under Secretary of the Treasury Sigal Mandelker said in a blunt speech on Tuesday.A second EU official said the US was sending out such teams across the world with a private warning against doing business with Iran.Washington last month said it would impose new economic penalties after pulling out of the accord that world powers struck with Iran under which Tehran agreed to curb its nuclear activities in return for sanctions relief.One EU official said the United States had also pressed the European Investment Bank, which has never done business in Iran, not to invest in European firms doing business there, despite a European Commission proposal it start doing so.The European powers are trying to come up with a package to ring-fence trade with Iran against renewed US financial sanctions to dissuade Tehran from quitting the accord.But the global reach of the US financial system, forcing companies to choose between two irreconcilable options - selling to Iran or to the vast US market - is driving home the limits of European efforts to shield their revived trade with Tehran.According to two diplomats, Andrew Peek, deputy assistant secretary of state with responsibility for Iran and Iraq, was in the Czech Republic on Tuesday and Hungary on Wednesday."The State Department delegation to Europe seeks to garner support for our global effort to pressure Iran and to explain our sanctions policy," an US State Department official said."We are making stops to many countries and will expand our diplomatic outreach efforts worldwide in the coming weeks. Meanwhile, our engagement with the E3 (Britain, France, Germany) is on-going, including during this worldwide diplomatic engagement."Peek briefed senior EU diplomats in Washington in May and warned the bloc to cut investments in Iran, telling EU officials doing business with Tehran helped fund its missile program and support for proxies in Yemen and Syria, diplomats said.One diplomat said the focus on Eastern European nations might be designed to pressure those EU countries most dependent on US security assistance in the face of a resurgent Russia.However, another diplomat suggested the push could backfire."This escalation and strategy of confrontation is a serious mistake and risks provoking even more chaos and instability in the Middle East," said a diplomat aware of the roadshow, saying US efforts had begun to "irritate quite a few of its allies." </s> WARSAW, Poland — The Trump administration lashed out at some of America’s closest traditional allies Thursday, accusing Britain, France and Germany of trying to bust U.S. sanctions against Iran and calling on European nations to join the United States in withdrawing from the Iranian nuclear deal.

In an unusually blunt speech to a Middle East conference in Poland, U.S. Vice President Mike Pence slammed the three countries and the European Union as a whole for remaining parties to the landmark 2015 agreement after President Donald Trump withdrew from it last year and re-imposed tough sanctions on Iran.

The harsh criticism threatened to further chill U.S.-European ties that are already badly strained on many issues, including trade and defense spending. And it underscored the stark two-year trans-Atlantic divide over Iran that manifested itself again ahead of the Warsaw conference co-hosted by the U.S. and Poland.

France and Germany declined to send their top diplomats to the ministerial-level meeting. EU foreign policy chief Federica Mogherini also stayed away due to concerns it would become an anti-Iran vehicle. Britain, France and Germany, along with the rest of the EU, continue to support the nuclear deal as the best way to prevent Iran from developing atomic weapons.

At the close of the conference, Secretary of State Mike Pompeo and his Polish counterpart Jacek Czaputowicz both noted differences of opinion over policies toward Iran. But, they said all participants agreed on the threat posed by the country, which is celebrating the 40th anniversary of the Islamic Revolution this week.

“There was not a defender of Iran in the room,” Pompeo said, adding that the U.S. and Europe were still capable of working together on the issue.

Czaputowicz said the U.S. and Europe “share the same diagnosis of the situation,” which is “the negative role played by Iran.” But he also noted that the U.S. and Europe differ on how to approach the matter.

In his earlier speech, Pence showed just how sharp that difference is.

He was harshly critical of Britain, France and Germany for unveiling a new financial mechanism last month that U.S. officials believe is intended to keep the nuclear deal alive by evading American sanctions.

Pence praised other nations for complying with U.S. sanctions by reducing Iranian oil imports, but he said the Europeans fell short.

“Sadly, some of our leading European partners have not been nearly as cooperative,” Pence said. “In fact, they have led the effort to create mechanisms to break up our sanctions.”

He said the mechanism, a barter-type payment system that is designed to allow businesses to skirt direct financial transactions with Iran, is “an effort to break American sanctions against Iran’s murderous regime.”

“It’s an ill-advised step that that will only strengthen Iran, weaken the EU, and create still more distance between Europe and the United States,” the vice president said.

Pence then called for Europe to abandon the nuclear agreement altogether, making explicit a demand that Trump administration officials had previously only hinted at.

“The time has come for our European partners to withdraw from the Iran nuclear deal and join with us as we bring the economic and diplomatic pressure necessary to give the Iranian people, the region and the world the peace security and freedom they deserve,” he said.

Niels Annen, a German deputy foreign minister who participated in the conference, told reporters after Pence spoke that Europe has a common position on the need to preserve the nuclear deal, and he dismissed U.S. concerns about the new financial mechanism. He said Germany believes both pressure and nuclear deal need to be maintained.

“We believe we need both,” he said. “We need pressure on Iran ... but we also need cooperation on the basis of this international agreement and we will continue to pursue this together.”

Germany, Britain and France have vigorously defended the new payment system as necessary to preserve the Iran accord, under which Tehran was granted billions of dollars in sanctions relief in exchange for curbs on its nuclear program.

They are also highly unlikely to withdraw from the agreement, a signature foreign policy achievement of the Obama administration. Their governments have repeatedly expressed support for it since Trump declared the U.S. would pull out.

The U.N.’s atomic watchdog and Trump’s own intelligence chiefs have said Iran remains in compliance with the agreement despite the U.S. withdrawal.

Pence, however, said Iran’s adherence to the deal’s terms is irrelevant. He said the accord was fatally flawed to begin with as it does not prevent Iran from obtaining the technology or material to eventually develop a nuclear weapon over time.

“Compliance is not the issue; the deal is the issue,” he said, calling Iran the “single greatest threat” to security in the Middle East.

Iran was not invited to the Warsaw conference and called the event a “circus” aimed at “demonizing” the country.

Because of European reluctance to attend a conference focused only on Iran, Pompeo and other U.S. officials had sought to broaden the scope to include other Middle East topics. The schedule included sessions on the Israeli-Palestinian conflict, Syria, Yemen, cybercrime and terrorism.

“No one country will dominate the discussion today, nor will any one issue dominate our talks,” Pompeo said at the opening of the conference,

But Pence’s comments, as well as earlier remarks by Pompeo, made clear the meeting was largely focused on isolating Iran.

Before the event opened, Pompeo met with Israeli Prime Minister Benjamin Netanyahu and said, “You can’t achieve peace and stability in the Middle East without confronting Iran. It’s just not possible.”

Pence opened his keynote address by lauding the Trump administration’s commitment to fighting “radical Islamic terrorism,” a term he used in some form at least seven times.

He hailed gains made against the Islamic State group in Iraq and Syria, where the extremists are being ousted from their last remaining areas of control. Despite Trump’s abrupt decision to withdraw American troops from Syria, Pence said the U.S. would remain in the region to ensure the militant organization does not return.

“We will continue to hunt down the remnants of ISIS wherever and whenever they rear their ugly head,” he said.

No matter what the conference yields on Syria, the future of the country was more likely to be determined at a Thursday meeting between Russian President Vladimir Putin and the presidents of Iran and Turkey

The three leaders were in the Russian Black Sea resort of Sochi to discuss a Syria peace settlement as expectations mount for an imminent and final defeat of IS ahead of the U.S. pullout. </s> The commander of the Islamic Revolutionary Guard Corps (IRGC) has slammed the address made by US Secretary of State Mike Pompeo and "anyone who backs" Washington, saying that the Iranian people would deliver a "strong punch to the mouth" of the American official.

"The people of Iran should stand united in the face of this," Ismail Kowsari, the deputy commander of the Sarollah Revolutionary Guards base in Tehran added, as quoted by the Iranian Labour News Agency.

The statement comes a day after Pompeo delivered a speech dubbed "After the Deal: A New Iran Strategy," in which he promised that the US would apply unprecedented financial pressure on Tehran via "strongest in history" sanctions. While stating that Washington won't renegotiate the historic Iran nuclear deal, he also outlined 12 demands for Tehran, including the withdrawal of forces from Syria.

The Islamic Republic has slammed the address, with Iranian President Hassan Rouhani saying that the world cannot accept that Washington makes unilateral decisions for all nations.

READ MORE: Israeli PM Praises Pompeo's Iran Speech as 'Policy That Can Guarantee Security'

In its turn, the EU, which has been one of the brokers of the 2015 nuclear agreement, has also criticized the move: "Secretary Pompeo's speech has not demonstrated how walking away from the JCPOA (nuclear deal) has made or will make the region safer from the threat of nuclear proliferation or how it puts us in a better position to influence Iran's conduct in areas outside the scope of JCPOA."

The US relations with its major EU allies — namely Germany, France and Britain — members of the P5+1 group that reached the nuclear accord, have significantly deteriorated due to President Donald Trump's decision on the withdrawal from the accord, which he has long been as the "worst deal in history."

According to German media reports, the EU, Germany, France and Britain have invited Russia and China to discuss the future of the Iranian nuclear deal in Vienna, with the US representatives being sidelined from the upcoming meeting. </s> (Bloomberg) — U.S. President Donald Trump’s desire to isolate the Iranian economy seems to be working.

Within hours of Washington unveiling its first round of sanctions, German carmaker Daimler AG froze a plan to make Mercedes Benz trucks in Iran. That’s even after the European Union tried to salvage the Iran nuclear deal by pledging to protect firms from Trump’s assault.

“I wouldn’t be surprised if more companies were to follow Daimler out of Iran,” said Frank Biller, a automobile analyst based Stuttgart, Germany for Landesbank Baden-Wuerttemberg. “With the political situation right now, I’m sure a lot of companies are at least thinking about suspending their activities.”

Companies across Europe — from French energy giant Total SA and German carmaker Volkswagen AG — had initially announced plans to reestablish ties with Tehran following the 2015 deal that provided Iran with relief from economic sanctions in exchange for curbs on its nuclear program. Trade between the Islamic republic and Europe surged to more than $10 billion.

Yet while Trump’s European allies condemned his move because they regard the nuclear deal as crucial for international security, the challenge for businesses is that they now have to weigh the potential loss of American clients against economic ties with Tehran that are minuscule by comparison.

Even when Trump was just threatening to reinstate sanctions in May, Total said it couldn’t risk investing in Iran following the return of U.S. sanctions because of its large U.S. operations.

“Anyone doing business with Iran will NOT be doing business with the United States. I am asking for WORLD PEACE, nothing less!,” Trump said in a Twitter post on Tuesday. “The Iran sanctions have officially been cast. These are the most biting sanctions ever imposed, and in November they ratchet up to yet another level.”

Following an executive order signed by Trump, the U.S. imposed new restrictions intended to stop the purchase of dollar banknotes by Iran, prevent the government from trading gold and other precious metals and block the nation from selling or acquiring various industrial metals. The measures, which took effect at midnight in Washington, also targeted the auto industry and banned imports of Persian carpets and pistachios to the U.S.

The European Union condemned the move and announced it would be rolling out an updated version of its so-called Blocking Statute which bans any EU company from complying with U.S. sanctions and does not recognize any court rulings that enforce American penalties.

“We are determined to protect European economic operators engaged in legitimate business with Iran,” the EU said in a statement late on Monday.

In a televised address on Monday night, Iranian President Hassan Rouhani called on the EU and other countries to take concrete action to save the Iran accord — although he too acknowledged the limits.

“In my visits to Europe and China and Russia and in the talks I’ve had, I’ve seen that they’ve all promised that they will not pay attention to the sanctions,” Rouhani said. “But the problem is their companies, which are under pressure from the U.S. and are affected by the U.S. sanctions.”

To minimize the effect of sanctions, Rouhani said the government had widened the list of essential goods that could be imported and said Iran had enough foreign-currency supplies to meet society’s needs. Iran’s central bank, acting on the eve of the U.S. move, scrapped most currency controls introduced this year in a bid to halt a plunge in the rial that has stirred protests against the government.

The U.S. goal is to get the Iranian regime to stop meddling in countries from Syria to Yemen, halt its ballistic missile program and commit to stricter limits on its nuclear program, not to overthrow the government, the administration officials said.

Rouhani said he’d be open to negotiations if the U.S. is “sincere,” but he added that such talks would be meaningless while his nation is being hit with sanctions. Trump and his top aides have raised the possibility of face-to-face discussions with Rouhani with “no preconditions.”

For European companies, Iran became an investment hot spot following the 2015 accord because it’s home to 82 million consumers who were starved of most Western products for years under international sanctions.

Before dropping business in Iran for a first time in 2010 under those penalties, for instance, Daimler had sold as many as 10,000 vehicles there annually. The company hadn’t yet resumed sale or production of cars or trucks before the pullout announced Tuesday.

The U.S. is preparing another set of sanctions, which take effect in 90 days and will target Iranian oil exports. It is weighing case-by-case exemptions for some countries from those penalties, according to Trump administration officials who briefed reporters on Monday. </s> The European Union has updated legislation aimed at countering sanctions imposed by the United States on businesses operating in Iran as part of its pledge to uphold the nuclear deal after Washington pulled out.

The US announced its decision last month to exit the 2015 deal, which aims to prevent Iran from developing nuclear weapons in return for the lifting of sanctions that had stifled its economy.

Wednesday's development came as the EU and the other parties to the deal vowed to stick to the agreement if Iran continues to implement it.

The European Commission, the executive branch of the EU, revised the so-called blocking statute - legislation that seeks to shield EU companies that continue doing business with Iran, and gives them a framework to recover any damages suffered as a result of US sanctions.

It also authorised the European Investment Bank (EIB) to finance Iranian projects, while noting it was up to the bank to give the go-ahead for any investments.

EU governments and members of the European Parliament now have a period of two months to object to the two measures; otherwise, they will come into effect in early August, which is when the first round of US sanctions against Iran will take effect.

However, the EIB on Wednesday said it could not ignore US sanctions on Iran, rejecting the EU executive plan that it to do business there in an effort to save the 2015 nuclear deal.

The pushback from the European Union's lending arm underscores the limits of the bloc's ability to shield trade with Iran from the reimposition of US sanctions.

Despite its political role in supporting EU policy, the EIB said it "could not be the solution to the problem" of a push by the remaining parties to keep alive their promise of sanctions relief in exchange for curbs on Tehran's nuclear programme.

"The EU bank is not the right tool," an EIB spokesman told Reuters news agency, saying its business model "would be incompatible with ignoring possible sanctions against Iran".



Germany, France and the United Kingdom also appealed to Washington not to punish European companies for doing business in Iran, in a letter sent to US Secretary of State Mike Pompeo and Treasury Secretary Steven Mnuchin, dated June 4.

They requested exemptions for EU companies that struck deals in Iran after the nuclear deal came into effect, and for key sectors such as energy, civil aviation and infrastructure, as well as exemptions to maintain financing channels with Iran, among other things.

Besides the EU and the US, the Iran nuclear deal was negotiated by Britain, France, Germany, Russia and China. It was formally endorsed by the UN Security Council, incorporating it into international law.

Iran said on Wednesday it was in "preparatory works" to restart nuclear activities in the event of the failure of the 2015 accord.

In such a scenario, Iran could "restart its activities without any limits," Iran's ambassador to the International Atomic Energy Agency (IAEA) Reza Najafi told reporters on the sidelines of a meeting of its board in Vienna.

Iran is expected to top the agenda at the Group of Seven (G7) summit on Friday and Saturday in Canada, where seven of the world's most-developed countries will come together to discuss policy. </s> The U.S. campaign to rein in Iran has scored a victory in the German financial sector, after the Deutsche Bundesbank− the country’s central bank− imposed a rule stopping a $400 million cash delivery to Tehran.

Iran's cash-starved economy desperately needs hard currency ahead of crippling U.S. bank sanctions that will be introduced in November.

Germany allows the Iranian-owned European-Iranian trade bank (EIH) to operate in Hamburg. The EIH holds more than $400 million that Tehran wants to receive in cash ahead of a second wave of U.S. sanctions due in November that impact banks and Iran’s energy sector.

The Deutsche Bundesbank has cooperated with the EIH in the past to circumvent U.S. sanctions on Iran. The U.S. and the European Union previously sanctioned the EIH for its role in advancing Iran’s nuclear and missile programs. The sanctions on the EIH were lifted after the world powers reached an agreement to curb Iran's nuclear program in 2015.

IRAN CROWDS REPORTEDLY CHANT 'DEATH TO THE DICTATOR!' AS US SANCTIONS INCREASE ECONOMIC UNREST

But President Trump effectively tore up the “decaying and rotten” deal in May and vowed to impose greater sanctions on the regime.

The disclosure in July that German Chancellor Angela Merkel's government was seeking to circumvent the pending sanctions triggered the U.S. ambassador to Germany to urge her government to stop the massive payment transfer.

“We are grateful to our German partners for recognizing the need to act.

Iran’s malign activities throughout Europe are a growing concern,” Richard Grenell, the U.S. ambassador to Berlin, told FoxNews.com. Grenell, a former Fox News contributor, led the campaign to persuade German authorities to prevent the cash transfer.

The U.S. embassy to Berlin tweeted: "Close partnership = results. Thank you to our German counterparts for acting to stop Iran’s activities."

The German central bank's new anti-Iran rule is slated to go into effect on August, 25.

Chancellor Merkel's efforts to send more than $400 million to the mullah regime echoes the Obama administration’s 2016 delivery of $1.7 billion in cash to Tehran, as part of a ransom to secure the release of American hostages held by the Islamic Republic.

President Trump has repeatedly slammed his predecessor for sending the cash.

The United States government has classified the Islamic Republic of Iran as a top state-sponsor of terrorism. The Merkel administration is going to great lengths to promote trade with Tehran. The German Economy Ministry said on Monday “export guarantees and investment guarantees from the Federal Ministry of Economic Affairs are still available to companies” that want to operate in Iran.

Germany's government provides 57 companies with more than $1 billion in export and investment guarantees for their business with Iran.

TRUMP RENEWS 'BITING SANCTIONS' AGAINST IRAN, WARNS COUNTRIES DOING BUSINESS WITH TEHRAN

Major German multinational companies, however, are voting with their feet.

Automobile manufacturer Mercedes-Benz announced on Tuesday that it had frozen all business with Iran due “to applicable sanctions.” The first wave of U.S. sanctions kicked in on Tuesday and will impact Iran’s automobile sector, as well as trade in precious metals.

Sportswear giant Adidas meanwhile followed the lead of its U.S. competitor Nike and pulled the plug on its business with Iran.

Adidas said in a statement last week that it will not extend commercial agreements with Iran's soccer association. Iran's state- controlled media reported that Adidas withdrew from Iran's market because it fears damage to its business in the U.S.

Peter Kohanloo, the president of the U.S.-based Iranian American Majority organization, told FoxNews.com: “Germany, France and the UK always talk about human rights and democracy, but by resisting more sanctions, they’re actively opposing a growing revolution inside Iran to replace one of the most egregious human rights violating dictatorships in the world.

“Germany is making a huge mistake by injecting much-needed cash into the mullahs’ resistance economy as they murder Iranian protesters.”

In a joint statement on Monday, Federica Mogherini, the EU’s foreign policy chief, and the foreign ministers of Britain, France and Germany said: “We are determined to protect European economic operators engaged in legitimate business with Iran.”

The EU implemented a “blocking statute” to insulate EU companies active in the Islamic Republic from American sanctions.

The Association of German Chambers of Commerce and Industry said on its website that in the first five months of this year, exports to Iran dropped by four percent.

Over the last few years, 120 German companies have opened offices in Iran, according to the German industry group, but that trend is sinking.

German exports to Iran climbed to $3.96 billion in 2017, up from $2.89 billion in 2016.
The foreign ministers of Germany, Russia, the United Kingdom, France, China and Iran agree to the creation of a Special Purpose Vehicle, a financial facility in the European Union, to facilitate payments and continue trade with Iran after the US withdrawal from the Iran deal.