×
Newsmax TV & Webwww.newsmax.comFREE - In Google Play
VIEW
×
Newsmax TV & Webwww.newsmax.comFREE - On the App Store
VIEW
Tags: Europe | Iran | US | Sanctions

EU Companies Could Face Legal Action over Iran Contracts

Wednesday, 12 May 2021 08:01 AM

BRUSSELS (AP) — European companies doing business with Iran could face legal troubles if they have terminated their contracts with Iranian banks or firms solely because of fears about possible U.S. sanctions, according to a legal opinion handed down Wednesday by a top EU court advisor.

The case centers around then President Donald Trump’s 2018 decision to unilaterally pull the United States out of the Iran nuclear agreement. The move sparked a series of U.S. sanctions, some of them meant to prevent companies from doing business with Iran.

To protect European interests and help Iran’s moribund economy, the EU introduced a “blocking statute” shielding companies in the 27-nation bloc. However, many big firms do more business in the United States than in Iran and some quickly severed ties rather than risk running afoul of U.S. sanctions.

In Germany, Iran’s Bank Melli launched legal action against Telekom Deutschland after the telecommunications firm ended its contract with the Iranian bank’s branch in Hamburg without providing a reason.

In Wednesday’s legal opinion, Advocate General Gerard Hogan said that European companies should justify why they are cutting business ties with Iranian banks and enterprises to prove they aren't simply caving in under the threat of U.S. sanctions.

The opinion is nonbinding, but the European Court of Justice often follows such legal guidance and could well do so again when the Luxembourg-based court rules on the case involving Bank Melli, Iran’s biggest bank, probably in coming months.

According to a statement, Hogan “considers that it is for Telekom Deutschland to establish that there was an objective reason — other than the fact that Bank Melli Iran was subject to primary sanctions — which justified the termination of the contracts at issue.”

Telekom Deutschland says around half its turnover is made in the United States and argues that the EU blocking statute shouldn't stop it terminating a contract without reason. But Hogan says Iranian banks or companies may ask EU national courts to order that such contracts be upheld.

© Copyright 2021 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


GlobalTalk
European companies doing business with Iran could face legal troubles if they have terminated their contracts with Iranian banks or firms solely because of fears about possible U.S. sanctions, according to a legal opinion handed down Wednesday by a top EU court advisor.The...
Europe,Iran,US,Sanctions
330
2021-01-12
Wednesday, 12 May 2021 08:01 AM
Newsmax Media, Inc.
Join the Newsmax Community
Register To Comment Login To Comment
Please review Community Guidelines before posting a comment.
 
 
TOP

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
© Newsmax Media, Inc.
All Rights Reserved
NEWSMAX.COM
© Newsmax Media, Inc.
All Rights Reserved