Update on US sanctions on Iran
In April 2019, we informed that the US would not renew any of the Significant Reduction Exceptions ("SRE"s) that previously had authorized eight countries – including China – to purchase oil form Iran without facing risk of US sanctions. Now, after the expiration of the SREs, the Trump Administration has shown that its maximum pressure campaign against the Iranian regime, and Iranian oil in particular, will be enforced – also against foreign parties.
Namely, on 22 July 2019, sanctions were imposed on the Chinese entity Zhuhai Zhenrong Company Ltd and its chief executive for knowingly acquiring Iranian crude oil. According to the US Department of State press release, the transaction took place after the expiration of China’s SRE on May 2, 2019, and in contravention to US sanctions. The parties were added to the Specially Designated National (SDN) List, which prohibits any US person from dealing with the parties' property or interest in property.
While announcing these sanctions, the US Secretary of State took the opportunity to underline that "[a]ny entity considering evading our sanctions should take notice of this action today. … All entities must do their diligence and stay well clear of sanctioned Iranian entities and sectors."