Business World

Sunday 18 November 2018

Swift payment system bows to Iran sanctions

Rial talk: European Economic Affairs Commissioner Pierre Moscovici said the EU was opposed to US sanctions against Iran. Photo: Bloomberg
Rial talk: European Economic Affairs Commissioner Pierre Moscovici said the EU was opposed to US sanctions against Iran. Photo: Bloomberg

Sudip Kar-Gupta

THE European Union is opposed to the United States' decision to reimpose oil and financial sanctions against Iran, European Economic Affairs Commissioner Pierre Moscovici said yesterday.

"The European Union does not approve of it," Moscovici told Franceinfo radio, hours after further US sanctions on Iran came into force.

Washington decided to reinstate punitive measures that were lifted under a 2015 nuclear deal negotiated by the administration of President Barack Obama, and added 300 new designations in Iran's oil, shipping, insurance and banking sectors.

The Belgium-based Swift financial messaging service said it is suspending some unspecified Iranian banks' access to its messaging system in the interest of the stability and integrity of the global financial system.

Swift is used to send data, including money transfers, between banks.

In a brief statement, Swift made no mention of US sanctions coming back into effect on some Iranian financial institutions on Monday as part of US President Donald Trump's effort to force Iran to curtail its nuclear, missile and regional activities.

The Swift statement said suspending the Iranian banks' access to the messaging system was a "regrettable" step, but was "taken in the interest of the stability and integrity of the wider global financial system".

Having abandoned the 2015 Iran nuclear deal, Mr Trump is trying to cripple Iran's oil-dependent economy and force Tehran to quash not only its nuclear ambitions and its ballistic missile program but its support for militant proxies in Syria, Yemen, Lebanon and other parts of the Middle East.

Swift is caught between two contrary regulatory demands.

The US government has told Swift that it is expected to comply with US sanctions and it could face sanctions itself if it fails to do so. On the other hand, Swift is barred from doing so under the European Union's so-called blocking statute, which could subject it to European penalties for complying with US law.

Reuters

Irish Independent

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