Risky Business: European Investment Bank Rejects Doing Business In Iran

Swiss Maritime Shipping Company Pulls Out Of Iran, Despite EU Efforts

The European Investment Bank (EIB), the European Union’s (EU) lending bank, has thrown cold water on the EU’s plan to circumvent U.S. sanctions. Speaking during a news conference last week, EIB President Werner Hoyer stated in unequivocal terms that doing business in Iran is “where we cannot play an active role.”

EIB’s comments come as the EU has become increasingly active in its efforts to salvage the Joint Comprehensive Plan of Action (JCPOA) and as the U.S.’ August 6 deadline for re-imposing sanctions approaches.

In recent days, however, the EU, despite the EIB’s position, has added Iran to the list of countries with which the EIB can deal with and attempted unsuccessfully to acquire broad-sector U.S. waivers for European businesses.  It has also considered passing a “blocking statute” whose purpose would be to try and void official U.S. actions in Europe.

“The EIB decision affirmed that it values its relationship with the United States over that of the world’s leading state sponsor of terrorism,” said UANI President David Ibsen.  “Since pulling out of the Iran deal, the Trump Administration has made clear that it would have little tolerance and heavy sanctions for companies still doing business with the regime. Both Europe’s business community and European Investment Bank are taking those risks seriously – it is strange that the European Union is not.”

Earlier this month, Switzerland-based maritime shipping company Suisse-Atlantique affirmed to UANI that it would cease all operations with Iran despite the EU’s initiatives.

Suisse-Atlantique wrote to UANI, “we have given clear instruction[s] to our chartering department to stop every future business with Iran and to exclude Iran as [a] destination from our charter party, even if [the] EU is still promoting the Iran Nuclear Deal and we are a Swiss and European company, and therefore shall not be oblige[d] to follow the US sanction[s].”

“Suisse-Atlantique’s seeming rejection of Iran, alongside the rolling exodus of other European-based firms, is a repudiation of EU policies,” said UANI Research Director Daniel Roth.  “The EU first tried to encourage European firms to invest in Iran, but they refused.  Now, the EU is trying to encourage its own bank to facilitate investment, but it refused.  Businesses have sent a message that they believe the risks simply are not worth it.”

Earlier this month, French reinsurance company Scor SE also confirmed that it was pulling out of Iran, citing the pending U.S. sanctions.

With the first set of snapback sanctions only weeks from implementation, companies such as Suisse-Atlantique have a limited window remaining to withdraw from Iranian operations.  Firms that already left have figured out something EU leaders in Brussels still have not – that it will be businesses that will suffer the legal, political, financial and reputational risks of doing business in Iran.