United States Imposes Sanctions on Iran, and Europe’s Dismaying Response (Source thetrumpet.com)
At 12:01 a.m. on Tuesday, August 7, the United States, following its exit from the nuclear deal in May, officially began its first batch of sanctions on Iran.
These sanctions will target financial transactions involving U.S. dollars, Iran’s car-manufacturing sector, the purchase of commercial aircraft, and metals including gold. A second tranche targeting Iran’s oil sector and its central bank is to be reimposed in early November. The goal is that with financial pressure, the Iranian regime will be coerced into changing its stripes. Or even better (although the U.S. has said this isn’t the goal) that the people of Iran will be affected so much that regime change is demanded by the population. Such an outcome would be good for Iran and the rest of the world but is highly unlikely
That fact is where it gets complicated, especially for many European nations who would still like to do business with Iran and keep the nuclear deal. As an expression of its disagreement with the U.S., the European Union has enacted an obscure 1996 law to demand that EU companies reject the U.S.’s demands. According to the “blocking law,” EU companies will be barred from pulling out of Iran due to pressure from the U.S. without the express approval of the European Commission. If they do so, they will be penalized by their respective governments. It also enables the EU to sue for damages against the entity that imposed the sanctions, which, in this case, is the United States. While this law sounds pretty impressive, many commentators agree that, in all likelihood, the European diktat will be almost impossible to enforce.
It’s more likely that EU companies will choose to do business with the U.S. over Iran any day of the week, even with such penalties. However, by even enacting this law, something far more damaging is taking place: It is further exacerbating the rift between the United States and its European allies.