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Members are referred to the Club’s previous advice issued in relation to Iran sanctions legislation and in particular the Club’s web circular of 29 October 2010 concerning Council Regulation 961/2010.
Needless to say, the above Regulation, as well as similar legislation in the US (see web circular of 2 July 2010), cause great implications to the shipping industry and members are advised to review their business and as appropriate seek advice from the Club or lawyers to satisfy that they are not involved in any activity which (1) may expose them to sanctions or (2) entails that insurance cover could be restricted.
Having said the above, the Club wish to highlight a particular feature with the Council Regulation which has great implications as far as members’ insurance cover is concerned in case of calling an Iranian port – Article 21 of the Regulation prohibits EU based entities to make payments in excess of EUR 40,000 to an Iranian person, entity or body unless the payment has been authorised by a competent authority. As far the Club is concerned, that authority is Swedish Financial Supervisory Authority. According the same Article consent will not be given in the event that the transfer of funds will contribute to any of the following activities:
• Iran’s heavy water related activities
• Development of nuclear weapons
• Other activities identified by IAEA
• Activities related to exploration or production of crude oil and natural gas and refining and liquidation of natural gas
Prima facie, this have the following practical implications should the Club decide to divert from the pay to be paid principle:
• There will be an inherent delay in the Club’s ability to deal with and particularly pay claims in Iran
• This delay will be particularly critical for the Member in case of a vessel arrest and a Club LOU is required for release of the vessel
• There is a risk that the Club will be unable to provide a LOU and make a payment to an Iranian person altogether
Members are invited to take due note of the above.
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