Monday, January 18, 2016

Nuclear Deal Brings Import - Export Trade Back to Iran as Sanctions End

UK Government Strives for Return to Normality
Shipping News Feature
UK – IRAN – With the lifting of most of the sanctions on Iran following the nuclear agreement drawn up in July 2015 and ratified this month, many exporters, and indeed importers, will be keen to normalise trade relations with a country which, until very recently, was subject to extensive UN as well as EU, US and third country sanctions. Not everything in the garden is lovely however and restrictions remain in place with regard to human rights, nuclear proliferation and Iran’s support for terrorism.

The UK government is however putting a positive spin on things and says it is keen for a rapid expansion of trade with the country. It has issued guidance in the form of a notice to potential shippers answering the barrage of questions, or FAQ’s, which the change in status will doubtless engender. It has also authorised UK Export Finance (UKEF), the country’s export credit agency, to reintroduce cover to support UK companies seeking to compete for business in Iran. To improve UK-Iran trade, UKEF will work directly with the Export Guarantee Fund of Iran and the Iranian Ministry of Economic Affairs and Finance.

Cover is now available on a case-by-case basis in Pounds Sterling and Euros. Within this, and in recognition of the UK’s place as a global centre of excellence for financial and professional services, UKEF will make available a £50 million facility guaranteeing payments to UK professional advisory service providers advising the government of Iran.

This facility can cover advice on areas such as: accounting standards; capital market development; compliance with global regulatory requirements; accessing and reducing the cost of financing; and facilitating new trade. UKEF will also consider applications for direct lending to purchasers of British exports to Iran.

The British government has stated that UK Trade and Investment (UKTI) will be engaging with UK businesses to provide support and assistance to help ensure UK business benefits from opportunities as they arise. UKTI based both in the UK and in the British Embassy in Tehran will play an important role in supporting trade and investment between both countries.

Doubtless further support will be available to members of trade organisations such as the British International Freight Association (BIFA), whose Director, Robert Keen has already been tweeting on the subject with unsurprisingly conservative notes from those such as lawyers Clyde & Co and Holman Fenwick.

Photo: The Seyyedoshohada Mosque in Khorramshahr after the Iran Iraq war. The port city was a major trading point before being devastated by the conflict and is now slowly building up to be once more a centre of commerce.