On November 24, 2013 Iran and P5+1 (China, France, Germany, Russia, the United Kingdom and the United States) reached a deal on Iran’s nuclear program. The agreement, called Joint Plan of Action or the Geneva Deal, requires Iran to take specific steps to demonstrate the peaceful nature of its nuclear program. The P5+1 countries in return, undertook to suspend some of the existing sanctions imposed against Iran and to refrain from imposing new nuclear related sanctions against it until a comprehensive agreement is reached by further negotiations.
On several occasions after the Geneva deal, the United States added various Iranian nationals and entities to its list of Special Designated Nationals (SDNs), including some Iranian banks and financial institutions. While apparently in contradiction with the Geneva Deal, the United States argues that these designations should not be regarded as imposing new sanctions against Iran because the those nationals and entities have allegedly been involved in infringing and/or circumventing the existing sanctions.
Although this interpretation might seem consistent with the text of the Geneva Deal, it is clearly incompatible with its context. “The new listings by the Unites States should be regarded as breach of the object and purpose of the Geneva Deal” one of the Iranian chief negotiators says. The inclusion of new Iranian nationals to the SDN list could undermine the contractual balance behind the Geneva Deal. If Iran had known that nearly all of its banks and financial institutions would be included in the SDN list, it would not have consented to the existing Deal. Since only non-sanctioned Iranian banks and financial institutions are eligible to be involved in the financial channel mentioned in the Deal, listing them by the United States automatically excludes them form the financial channel. In other words, the inclusion of Iranian banks and financial institutions could narrow down the financial channel or even make it worthless. In such a case, Iran could invoke clausula rebus sic stantibus to refrain from complying with its own undertakings under the Geneva Deal. This clause is a customary international law rule recognized in the 1969 Vienna Convention on the Law of Treaties permitting the parties to a treaty to refrain from complying with their treaty obligations in cases of fundamental change in the circumstances.
The other argument against these listings is that general international law requirements have not been met by the United States while deciding on the inclusion of individuals and entities into the SDN list. These requirements enshrined in human rights law and echoed most frequently in the jurisprudence of General Court of the European Union, calls for designating states to respect the rights of the affected persons, including their right to property, fair trial and access to justice. In particular, the listed individuals and entities should be informed of the grounds for their designation and there should be clear procedures for judicial review of those designations upon the request of the affected persons. Breaching each of these rights could make the designation illegitimate. None of the people or entities designated by the United States after the Geneva Deal have been informed of the grounds for their designations except the general allegation that they have been involved in the activities prohibited by sanctions. But it has not been demonstrated when and how they have done that.
While IAEA has reported that Iran has fully complied with its obligations under the Geneva Deal, the United States has frequently added Iranians to its SDN list. Persistence of this trend could deepen the distrust of the Iranian side in the United States and make the attainment of the tangible results from the ongoing negotiations more difficult.
