Three European powers are set to make good on a plan to help companies trade with Iran, defying President Donald Trump with a bid to bypass U.S. sanctions, Bloomberg informs.
The plan, which could be presented as early as Monday, is key to the European Union’s effort to save a 2015 nuclear accord with Iran after Trump withdrew the U.S. Whatever the economic impact, the push by the U.K., France and Germany is another sign of European exasperation with the President.
A draft of an EU statement seen by Bloomberg welcomes the three-nation initiative as providing “a positive impact on trade and economic relations with Iran, but most importantly on the lives of Iranian people.” EU government envoys will discuss the statement in Brussels on Monday and may release it soon, if all 28 member countries agree, two diplomats added.
The initiative is designed to shield European companies keen to do business with Iran from U.S. sanctions that could result from dollar-based transactions.
The Trump administration has deemed the channel an attempt to evade its “maximum pressure” campaign against Iran, while questioning whether it’ll work. Sigal Mandelker, the Treasury’s top sanctions official, said in December she isn’t concerned “at all” that the mechanism can sidestep sanctions.
Since the U.S. left the nuclear accord, the deal’s remaining powers, China, France, Germany, Russia and the U.K., have struggled to provide the sanctions relief promised when Iran agreed to limits on its nuclear activities. The mechanism proposed by the European nations faced delays and skepticism that it can successfully persuade companies to trade, TIME noted.
As envisaged by the EU, the special purpose vehicle would accept payments from companies that want to trade with Iran, either by receiving waivers for oil imports or permissible trade in goods like food and medicine. With no direct transfer of funds between Iran and European actors, it would theoretically insulate firms from U.S. penalties.
Iran’s nuclear chief, Ali Akbar Salehi, said last week his country to resume nuclear enrichment with more advanced technology if the agreement fails. Iran is considering producing nuclear fuel used in naval propulsion, implying it may ramp up uranium enrichment levels closer to the purity needed for weapons, Bloomberg noted.