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EU moves to shield European firms from US sanctions against Iran

AFP  |  Brussels 

The EU launched formal steps today aimed at sparing European firms fallout from US sanctions on as part of efforts to preserve the nuclear deal with

The move to invoke the "blocking statute" had received the all-clear at a meeting of leaders in on Thursday as the transatlantic rift deepened.

The European Commission, the EU executive, said Friday it "launched the formal process to activate the blocking statute by updating the list of US sanctions on falling within its scope." US last week controversially pulled out of the 2015 international deal with that placed limits on its nuclear programme in return for easing economic sanctions.

The "blocking statute," which EU member states and the must still endorse, is aimed at easing the fears of European companies that invested in Iran after the deal.

"The blocking statute forbids EU companies from complying with the extraterritorial effects of US sanctions, allows companies to recover damages arising from such sanctions from the person causing them, and nullifies the effect in the EU of any foreign court judgements based on them," the commission said.

The commission said it hopes to have the measure in force before August 6 when the first batch of US sanctions take effect.

The commission also launched "the formal process to remove obstacles for (EIB) to decide under the EU budget guarantee to finance activities outside the European Union, in Iran," the said.

"This will allow the to support EU investment in Iran," it added, noting the measure could help small and medium-sized companies.

The "blocking statute" is a 1996 regulation originally created to get around Washington's trade embargo on Cuba, which prohibits EU companies and courts from complying with specific foreign sanction laws, and says no foreign court judgments based on these laws have any effect in the

However, the row was settled politically, so the blocking regulation's effectiveness was never put to the test, and its value may lie more in becoming a with

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Fri, May 18 2018. 17:00 IST