637. Is it sanctionable for non-U.S., non-Iranian persons to engage in transactions related to the provision of humanitarian and consumer goods to Iran?
The United States maintains broad authorizations and exceptions under U.S. sanctions that allow for the sale of agricultural commodities, food, medicine, and medical devices to Iran from the United States or by U.S. persons or U.S.-owned or -controlled foreign entities. U.S. sanctions laws provide similar allowances for sales of food, agricultural commodities, medicine, and medical devices to Iran by non-U.S. persons. Broadly speaking, transactions for the sale of agricultural commodities, food, medicine, or medical devices to Iran are not sanctionable unless they involve persons on the SDN List that have been designated in connection with Iran’s support for international terrorism or proliferation of weapons of mass destruction, including designated Iranian financial institutions or the Islamic Revolutionary Guard Corps (IRGC), or activity that is subject to other sanctions. Additional guidance relating to these authorizations and exceptions can be found on the OFAC website here and here.
Transactions by non-U.S. persons related to the export to Iran of consumer goods that do not fall within these exceptions, but are not expressly targeted by U.S. sanctions, should not involve certain persons on the SDN List, including the Central Bank of Iran or a designated Iranian financial institution, unless an exception under Section 1245(d)(4)(D) of the National Defense Authorization Act of Fiscal Year 2012 (NDAA 2012) applies, or the IRGC. In addition, such transactions should not involve U.S. persons or transit the U.S. financial system, unless the activities and/or transactions are exempt from regulation or authorized by OFAC.
[Ed Note: see original FAQ for hyperlinks]
1) This FAQ, much like FAQ # 630, provides crucial guidance suggesting that agricultural commodities, medicine and medical devices are, at least in practice, if not as a technical legal matter, exempt from the "material assistance" sanction at Sec. 1(a)(iii) of EO 13846, even though there is no explicit exemption for such transactions in the EO. EO 13846 contains exemptions for TSRA-related items, but they do not apply to Sec. 1(a)(iii).
For more on the relationship between derivative designation criteria and TSRA generally, see General Note on Secondary Sanctions and “Derivative Designation” Criteria; Identification of the Gap Between the Theoretical and Practical Scopes of Authorities Targeting Transactions with no U.S. Nexus; Enforcement Risk Management (System Ed. Note).