top of page


U.S. Exits Iran Nuclear Deal; All Sanctions Lifted or Waived under JCPOA to be Re-Imposed Within 180 Days

On May 8, 2018, the President announced that the United States is ceasing participation in the Iran nuclear deal, consisting of the 2015 Joint Comprehensive Plan of Action (JCPOA) scaling back U.S., EU and UN sanctions against Iran in exchange for Iran’s limitation of its nuclear program, and directed the Departments of State and Treasury to re-impose all U.S. sanctions against Iran that were lifted or waived in connection with the JCPOA within 180 days.  The Office of Foreign Assets Control (OFAC) has issued guidance detailing a framework for re-imposition of sanctions.

This action will effectively reset both primary and secondary U.S. sanctions against Iran to their pre-JCPOA status, following 90-day and 180-day wind-down grace periods.  Both U.S. and non-U.S. companies doing or considering business that directly or indirectly involves Iran should take note, as this development fundamentally changes the framework they have been working under for the past three years.  Some major, immediate implications are:

  • Effective May 8, 2018, new business involving Iran that was previously authorized or shielded by sanctions waivers under the JCPOA is no longer authorized or shielded from sanction.  Only transactions ordinarily incident and necessary to wind down pre-May 8 business undertaken in reliance on the JCPOA will continue to be authorized or shielded from sanction, for either a 90-day or 180-day period depending on the nature of the activity.

  • Secondary sanctions on foreign persons engaged in certain dealings in gold or precious metals, graphite, raw or semi-finished metals, coal, certain industrial software, Iran’s automotive sector, significant transactions in Iranian Rials, and some financial services will be re-imposed following a 90-day wind down period ending on August 6, 2018.

  • Secondary sanctions on foreign persons engaged in certain dealings in Iran’s shipping, shipbuilding, petroleum, petrochemical, and energy sectors, and other financial services will be re-imposed following a 180-day wind down period ending on November 4, 2018.

  • Effective immediately, U.S. persons (and other persons in transactions with U.S. nexus) can no longer obtain licenses authorizing them to supply commercial passenger aircraft and related parts and services to Iran for commercial passenger aviation.  The case-by-case licensing policy established under the JCPOA for such transfers has been rescinded.  OFAC will not consider pending or new license applications under the policy, and existing licenses issued under the policy will be revoked.  Wind down of activities under revoked licenses will be authorized until August 6, 2018.  A separate, non-JCPOA grounded case-by-case licensing policy for transfers to Iran for safety of civil aviation and safe operation of U.S.-origin commercial passenger aircraft is not affected and remains in effect.

  • Foreign entities owned or controlled by U.S. persons will once again be directly prohibited from engaging in most transactions involving Iran.  General License H, which to date has authorized such entities to do much business with Iran that U.S. persons cannot, will “as soon as administratively feasible” be revoked and replaced with a narrower authorization permitting only wind-down activities before November 4, 2018.


  • Persons and entities removed pursuant to the JCPOA from the Specially Designated Nationals and Blocked Persons List (SDN List) and other sanctions lists will be placed back on those lists, no later than November 4, 2018.  This will include numerous Iranian government-owned entities such as the Central Bank of Iran and National Iranian Oil Company (NIOC).  U.S. persons have been and continue to be prohibited from any dealing with such parties.  The re-listing will mean that non-U.S. persons will again face secondary sanctions exposure for knowingly engaging in certain transactions with such parties.


  • After the applicable wind-down period ends (August 6 or November 4), there will be some very limited ability for non-U.S., non-Iranian persons to collect outstanding payments for goods or services and outstanding repayment of loans and credits.  For the most part, however, after November 4, U.S. sanctions against Iran will be restored to their pre-JCPOA state. 


  • Some other changes include revocation of authorization for U.S. persons to import Iranian-origin carpets and foodstuffs, as well as re-imposition of sanctions applicable to foreign financial institutions supporting Iran that had been waived under the JCPOA.


Details of the above framework for re-imposition of sanctions will become more defined as OFAC and State issue implementing amendments and guidance.  Additionally, it is not immediately clear whether and to what extent the remaining portions of the JCPOA between Iran and the EU, China and Russia will remain in place, creating uncertainty for companies subject to both U.S. and EU sanctions regimes.  It is evident, however, that U.S. withdrawal from the nuclear deal will have significant, lasting ripple effects on economic activity worldwide.


In the coming days and weeks, some priorities for U.S. and non-U.S. companies alike will include: (a) reviewing and winding down any affected ongoing activities; (b) monitoring OFAC and State implementation of the re-imposition of sanctions; (c) re-assessing long-term business strategies to align with this shift in U.S. sanctions policy toward Iran; and (d) evaluating compliance processes to manage new or expanded exposure to risk of sanctions.

bottom of page