The Finance Ministers of Britain, France and Germany are reportedly working to establish a financial mechanism, on behalf of the European Union, that will allow for continued free trade with Iran, that despite international sanctions that were re-imposed on the Islamic Republic’s economy by the United States. According to reports published in the German media this morning, the European Union intends to bypass European commercial or national banks, which fear the consequences of doing business with Iran after the American sanctions come into force in November. By doing so, the EU will allow Iran to continue exporting oil and gas, the largest source of revenue for the Islamic Republic, in exchange for Tehran’s continued adherence to the Joint Comprehensive Plan of Action, which is the technical term for the 2015 nuclear agreement. According to the reports, the European powers are considering the option of setting up a special purpose vehicle in which all EU member states will be shareholders and that they will not be exposed to international sanctions, because those “special purpose vehicles” will not conduct business with The European Investment Bank. It is important to note that while EU governments are attempting to bypass the American sanctions, Central European banks have made it clear that they will not be able to continue transferring funds to Iran after the start of U.S. sanctions because they conduct business in the United States and are using the U.S. currency.
