World  Business and Economic Analysis 



The US Treasury Department’s Office of Foreign Assets Control on Thursday revised its Frequently Asked Questions guidance that concerns the reimposition of sanctions in the event of a sanctions snapback under the Joint Comprehensive Plan of Action.

The amended FAQs convey OFAC’s general view that should the US reimpose certain sanctions pursuant to a JCPOA snapback, the US government would provide a 180-day wind-down period for payments related to contracts entered into and executed during the JCPOA period.

In addition, OFAC also issued License J-1, which authorizes the temporary reexport of certain aircraft involved in code-sharing arrangements.

That guidance, in the form of two amended Frequently Asked Questions (M.4 and M.5), also clarifies that, "the United States will not retroactively impose sanctions for legitimate activity undertaken prior to any sanctions snapback."

The previous versions of FAQs acknowledged that the United States has historically made efforts to work with companies, both foreign and domestic, to minimize the impact of newly imposed (or re-invoked) sanctions on legitimate activities that companies undertook prior to the imposition of sanctions, but did not provide any assurance that this would take place in the event of a snapback under the JCPOA, stressing that OFAC would provide guidance at that time on its website.

Now, however, OFAC has amended the FAQs to state affirmatively that, consistent with this past practice, the US would provide a 180-day wind-down period following any potential sanctions snapback under the JCPOA.

In addition, if a non-US, non-Iranian entity has either provided goods or services, or extended credit to an Iranian entity prior to a JCPOA snapback, that party would be permitted to collect such payment, provided that no additional goods, services or loans were extended to Iranian entities following a JCPOA snapback.

Any such payments, of course, would still need to be fully compliant with US sanctions, and therefore would not be permitted to involve US persons or the US financial system—or, effectively, US dollars.

This grant of permission for non-US, non-Iranian companies, conducting business outside the United States, and in currencies other than the US dollar, provides some comfort to companies and banks engaged in high-value transactions that might be covered by reinstated secondary sanctions targeting particular sectors of the Iranian economy.

More consequentially, the amended FAQs also contain language applicable to US businesses that have reentered the Iranian market under the authorization of general or specific licenses issued by OFAC.

Any such entity would also be entitled to a similar 180-day wind-down period following any potential sanctions snapback under the JCPOA, which would necessarily revoke any licenses that had been issued in favor of those businesses.

In addition to the wind-down period, US businesses would be permitted to receive payments owed them under the terms of a written agreement, but would not  be entitled to deliver any additional goods or services, or extend additional loans or credit to an Iranian counterparty following a JCPOA snapback.

Any such conduct could result in the imposition of US sanctions against that US business.

Renewed Assurances

According to, OFAC’s decision to add language specifically calling for a wind-down period and subsequent permissibility of collecting payment from Iran entities is likely related to the coming change of administration in the United States.

As noted, the previous FAQs themselves recognized OFAC’s past practice of minimizing the immediate impact on permissible activities undertaken by non-sanctioned entities prior to the imposition of new sanctions programs.

Here, however, OFAC—or its superiors in the current administration—may have felt it necessary to attempt to embed this practice to provide reassurance to companies both in the United States and elsewhere that any policy changes with respect to the JCPOA after 20 January will not, notwithstanding heated campaign rhetoric and promises, completely ignore commercial realities to the detriment of those companies that acted in reliance on the international agreement and its implementation by the US and other countries.

It is not a coincidence that US Secretary of State John Kerry issued a statement on the same day that OFAC amended the FAQs announcing the United States’ continued commitment to the JCPOA and waiving the sanctions imposed under the newly renewed Iran Sanctions Act.

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کتاب عملیات بانکی در عرصه بین الملل -سرفصل ها،ضمائم ،توصیه صاحب‏نظران ارزی و مدیران ارشد بانکی

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