Posted 06/12/2011 by Nina Markovic
On 6 December 2011 the Australian Government
announced its intention to impose additional sanctions against Iran, ‘targeting additional entities and individuals for their involvement in Iran’s ballistic missile and nuclear programs’.
This follows the introduction on 21 November by the governments of the
United States (US),
Canada and the
United Kingdom (UK) of additional autonomous
sanctions against Iran in response to the International Atomic Energy Agency (IAEA) Board of Governors’
report about the advancement of Iran’s nuclear research and development program.
On 1 December the European Union (EU) foreign ministers decided to impose
additional EU financial and energy sanctions against Iran. The same day Michael Danby MP, Chair of the Joint Standing Committee of Federal Parliament’s Foreign Affairs Defence and Trade,
called on the Australian Government to impose additional sanctions against Iran.
IAEA reportOn 8 November 2011, the IAEA produced its most detailed report to date about Iran’s nuclear program, entitled
Implementation of the NPT Safeguards Agreement and relevant provisions of Security Council resolutions in the Islamic Republic of Iran. This report asserts that Iran’s capability to develop a ‘nuclear explosive device’ has significantly improved over the past few years, possibly with the help of foreign scientists. It alleges (p. 11) that:
…Iran may have planned and undertaken preparatory experimentation which would be useful were Iran to carry out a test of a nuclear explosive device.
On 18 November 2011, the IAEA adopted a
resolution supporting the report’s findings, expressing ‘deep and increasing concern about the unresolved issues regarding the Iranian nuclear program’.
Iran’s reactionsThe Iranian Ambassador to the IAEA, Ali Asghar Soltanieh,
dismissed the IAEA’s resolution, calling it ‘biased, illegal and politically motivated’. The Iranian Parliament
suggested to the Iranian Government that Iran’s ties with the IAEA be reviewed. Speaker of the Iranian Parliament and former key nuclear negotiator, Ali Larijani,
said that the IAEA report was ‘unrealistic’. He added that further international sanctions would not prevent Iran from pursuing nuclear technology, which he claims is for ‘peaceful’ or nuclear energy purposes.
The findings of the IAEA report have increased
diplomatic tensions in an already volatile Middle East region. Israel renewed its
threats to launch targeted military strikes against Iranian nuclear research facilities. The US Defense Secretary Leon Panetta
cautioned that should Israel exercise such a threat, there could be unintended consequences for Middle East security and ‘severe economic consequences around the world’.
Russia has expressed doubts about the IAEA’s November report, while
China voiced its concern about Israel’s threat of a military action against Iran.
UN Security Council sanctionsIn December 2006, the United Nations (UN)
Security Council Resolution 1737 introduced sanctions against Iran. On 23 December 2006 the Security Council
Sanctions Committee 1737 was established to monitor their implementation. The Committee is a
subsidiary organ of the Security Council and consists of all
members of the Security Council. Its 90-day reports are available
here.
The sanctions were extended under UN Security Council Resolutions
1747 (March 2007),
1803 (March 2008) and
1929 (June 2010) and previous measures reaffirmed with UN Security Council Resolutions
1887 (September 2009) and
1835 (September 2008). The
fourth round of sanctions, which Australia has fully implemented, came into force in June 2010.
Australia’s autonomous sanctionsAustralia imposed autonomous sanctions against Iran on
15 October 2008. These measures supplement the UN Security Council sanctions, and include financial sanctions against specific individuals and entities, travel restrictions against listed individuals, and arms and strategic goods embargo.
On
29 July 2010, the government announced additional measures against Iran, and publicly released a list of individuals and entities on
4 August 2010. Australia’s Autonomous Sanctions Regulations are currently under
review following the passage of the
Autonomous Sanctions Bill 2010. The Reserve Bank of Australia administers Australia’s financial
sanctions against ‘Iranian entities and persons who contribute to Iran's proliferation activities but are not already listed by the UN Security Council’.
As noted above, Australia
announced its intention to impose additional sanctions against Iran on 6 December 2011. According to the Minister for Foreign Affairs, Kevin Rudd, 'the measures will further restrict business with Iran's financial and petroleum sectors'.
Other autonomous measures (US, UK and Canada)On 21 November in a coordinated measure the
UK, Canada and the US imposed additional autonomous sanctions against Iran. The British Government’s decision to halt all financial transactions with the Central Bank of the Islamic Republic of Iran actively discourages trade with Iran. Her Majesty’s Treasury Department
said that was the ‘first time that the UK has used these powers to cut an entire country’s banking sector off from the UK’s financial sector’.
A Canadian statement on additional sanctions is available
here. The US State Department
reported the US is expanding sanctions against Iran and ‘identifying the Islamic Republic of Iran as a jurisdiction of “primary money laundering concern” under section 311 of the USA Patriot Act’.
While Iran and the US do not have official diplomatic relations, the Iranian Parliament
downgraded Iran’s relationship with the UK from the ambassador’s level to a charge d’affaires level. Following
mob attacks on the
UK embassy in Tehran on 29 November all British diplomatic staff had been withdrawn from Iran, and the UK Government also
expelled all Iranian diplomats from Britain leading to the
closure of Iran's embassy in London.
The Australian Minister for Foreign Affairs Kevin Rudd has
condemned the UK embassy attack. Several countries, including
France,
Germany and
Norway, have temporarily reduced their diplomatic representation in Tehran.
Other countermeasuresThe
Financial Action Taskforce, the global body responsible for anti-money laundering and anti-terrorist financing policies standards, has publicly identified Iran as a high risk nation since October 2007; and, since February 2009, has been calling upon its
members (which include Australia, the US, Canada, China, the Russian Federation and the UK) to implement and strengthen counter measures to
protect their financial sectors from money laundering and financing of terrorism risks emanating from Iran.
In March 2010, the Minister for Foreign Affairs and the Minister for Justice
jointly announced consultations on proposed regulatory measures to prohibit high risk transactions with Iran of AUD$20,000 or more. High risk transactions include international funds transfer, bills of exchange and promissory notes.
Individuals or businesses seeking to continue to deal with Iran would
need to seek an exemption from the Department of Foreign Affairs and Trade. The Government is currently considering responses to the draft regulation.
Conclusion Given Australia’s uninterrupted
diplomatic relations with Iran since 1968, it is unclear how additional measures would precisely affect Australia’s trade with Iran as well as existing
parliamentary relations between Canberra and Tehran.
Australia’s
merchandise exports to Iran in 2010–11 were valued at $157 million and merchandise imports at $121 million, while data on trade in services is unavailable. Recent media reports indicate that in the past two years the Department of Foreign Affairs and Trade has
referred ‘about 10 alleged breaches of sanctions to the Australian Federal Police’ whilst rejecting 11 applications to trade with Iran in 2010–11.