Commercial Risk Europe Cites Steptoe Advisory on Iranian Oil Sanctions

An International Law Advisory written by Steptoe?s Economic Sanctions team served as the sole source for an article published in Commercial Risk Europe on July 13.? The article discusses the European Union?s (EU) decision to prohibit its risk transfer sector from providing cover for the purchase, importation, and transportation of Iranian petroleum and crude oil.

The Foreign Affairs Council of the EU says it will not renew an exemption, which ended July 1, to allow EU insurers and reinsurers to provide environmental and third party liability coverage for Iranian crude oil and petroleum products destined to non-EU countries.

The council also decided not to renew a similar exemption applicable to any type of risk relating to the purchase, importation and transportation of Iranian crude oil and petroleum products destined to EU and non-EU countries.

However, the underlying Council Regulation 267/2012 appears to provide a limited exemption to allow reinsurance for shipments of Iranian crude oil or petroleum products where the underlying trade contract specifically provides that the supply of Iranian crude oil and petroleum products, or the proceeds derived from such supply, are to reimburse amounts outstanding to persons, entities or bodies under the jurisdiction of EU member states.

While the trade contract in question must have been concluded before January 23, 2012, any shipment will continue to be covered under this exemption as long as a reimbursement is required.

Guy Soussan, a Steptoe partner who is based in the firm's Brussels office, tells Commercial Risk Europe that the exemption will not be applicable to non-EU contracts since the beneficiaries of the reimbursements have to fall under the jurisdiction of the EU.

The practical effect at this time will likely be determined on a case-by-case basis, he says.

The full article can be read at Commercial Risk Europe.? The full client alert, authored by Mr. Soussan, Steptoe partner Ed Krauland, of counsel Jack Hayes and associates Michael Lieberman and Henry Smith, can be read at Steptoe?s publications page.

Source: http://www.steptoe.com/news-1171.html

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