Sanctions on Iran Grow

By Kerr, Paul; Boese, Wade | Arms Control Today, July/August 2007 | Go to article overview

Sanctions on Iran Grow

Kerr, Paul, Boese, Wade, Arms Control Today

During the past several months, the U.S. Departments of State and the Treasury have placed sanctions on several Iranian entities that they claim have engaged in activities related to Tehran's nuclear and ballistic missile programs. Meanwhile, the international community has moved forward in implementing other sanctions on Iran that were imposed in UN Security Council resolutions.

In June 2005, President George W. Bush authorized the Treasury Department in Executive Order 13382 to freeze the U.S. assets of foreign entities suspected of supplying or supporting the development of unconventional arms and ballistic or cruise missile programs. (See ACT, September 2005.) The order bars U.S. citizens, companies, and institutions from doing business or facilitating transactions with sanctioned entities, a term that encompasses individuals, private companies, or government agencies. Other foreign entities that do business with those already sanctioned risk being penalized as well.

The Treasury Department recently added a total of seven Iranian entities in three separate announcements. The first announcement was in April, the second and third in June. Earlier this year, the department added nine entities to the list, six of which were Iranian. (See ACT, March 2007.)

The U.S. government has designated a total of 43 entities under the executive order; 20 are Iranian. Of those, 15 are subsidiaries of five other entities.

Whether any of these designees have any assets under U.S. jurisdiction is unclear. Treasury Department spokesperson Molly Millerwise told Arms Control Today June 28 that the department does not disclose such information. Asked whether the assets belonging to subsidiaries of designated parent entities also are frozen, Millerwise explained that "all of" a designated company's "property and interests in property are blocked. Depending on the facts and circumstances, its investments in other companies may be considered blocked property."

Almost all of the recently designated entities are listed in an annex to UN Security Council Resolution 1737, which was adopted last December. The two exceptions are Iran's Aerospace Industries Organization and a related entity, Mizan Machine Manufacturing Group. The resolution imposed a series of sanctions on Iran, including restrictions on importing and exporting a variety of goods and technologies related to Tehran's nuclear and missile programs. (See ACT, April 2007.)

On April 3, the State Department designated Iran's Defense Industries Organization under the executive order for activities "that have materially contributed to, or pose a risk of materially contributing to, the proliferation of weapons of mass destruction or their means of delivery," according to an announcement in the Federal Register. The State Department provided no details, but the annex to Resolution 1737 describes the Defense Industries Organization as an "overarching" entity controlled by Iran's Ministry of Defense and Armed Forces Logistics. Some of the organization's "subordinates" have been involved in Iran's centrifuge and missile programs, according to the annex. The April 3 designation was the first such action by the State Department under the executive order.

On June 8, the Treasury Department designated two companies, Pars Tarash and Farayand Technique, for their involvement with Iran's gas centrifuge-based uranium-enrichment program. There is widespread concern within the international community that this program could be used to produce fissile material for nuclear weapons. Tehran maintains that the program is exclusively to produce fuel for nuclear reactors (see page 26).

The companies are connected to Iran's Atomic Energy Organization, the Kalaye Electric Company, or both, according to a department press release.

Bush included the Atomic Energy Organization, which the Treasury Department describes as "the main Iranian institute for research and development activities in the field of nuclear technology," in an annex to the original 2005 executive order.

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Sanctions on Iran Grow


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