Canada said it was lifting some sanctions against Iran, including a ban on financial services, imports and exports, thereby allowing companies such as planemaker Bombardier Inc to compete against rivals.
In a statement on Friday, the new Liberal government said all applications for export permits would be considered on a case-by-case basis, Reuters reported.
The European Union, the United States and other major nations have already lifted some of their own restrictive measures against Iran, leading to complaints that Canadian companies were being left behind.
Canadian Foreign Minister Stephane Dion said Bombardier, as well as oil, gas, chemical and agricultural companies, should benefit.
"For them, of course, it's great news," he told reporters, citing the importance of gaining access to a market of 80 million people.
Dion said last week that if Airbus can to sell to Iran, then Bombardier should be allowed to export there as well.
He said by maintaining sanctions against Iran, Canada is only hurting its own industries.
“If Airbus is able to do it, why (will) Bombardier not be able to do it? In which way (is it) helping Canada, or the Iranian people, or Israel, or anyone, that Canada is hurting its own industry?” Dion was quoted as saying by Reuters.
Iran announced plans in January to buy more than 160 European planes, mainly from Airbus.
The sanctions are being lifted as part of an international deal with Tehran to limit its nuclear program.
Dion says Ottawa would work to restore diplomatic relations with Iran gradually.
The former Conservative government cut all diplomatic ties with Iran in 2012. The Conservatives lost power to the Liberals in an October election.
