Guidance

Embargoes and sanctions on Iran

The UK government does not encourage trade with, or investment in Iran, and has withdrawn all commercial support for trade.

Introduction

This guide contains information about embargoes and sanctions on Iran. You can find more general information here on sanctions, embargoes and restrictions and a list of all the countries where there are current restrictions.

On 20 January 2014 the EU amended the sanctions against Iran. Read Notice to exporters 2014/03: changes to EU sanctions against Iran.

There are extensive trade and financial sanctions in place against Iran as a result of the UK’s foreign policy commitments and the imposition of EU and United Nations (UN) sanctions and embargoes. These include:

  • an arms embargo and a prohibition on the supply of equipment that could be used for human rights abuses
  • prohibitions on the sale, supply, transfer, import, transport or export of dual-use goods and technology
  • prohibitions on the provision of brokering services and technical and financial assistance related to any goods and technology whose supply is prohibited; prohibitions on investment in Iranian entities engaged in manufacturing those items
  • prohibitions on the sale, supply, transfer or export of key equipment and technology for the oil and gas industry (with a limited exemption for transactions required by, or obligations arising from, contracts that were in place before 27 October 2010); there are also specific exemptions on transactions for key equipment and technology for the petrochemical industry required by contracts which were in place before 23 January 2012
  • prohibitions on investment in Iranian entities or bodies engaged in the exploration or production of crude oil and natural gas, the refining of fuels or the liquefaction of natural gas
  • prohibitions on any new investment in the petrochemical sector in Iran or in Iranian or Iranian-owned enterprises engaged in that industry outside Iran
  • prohibitions on the sale, supply, transfer or export to, and the purchase, import or transfer from Iran of gold, precious metals and diamonds; also, the sale, supply, transfer or export of unissued or newly minted Iranian bank notes and coins to or for the benefit of the Central Bank of Iran
  • prohibition on the export of materials relevant to the Iranian nuclear and ballistic programmes or to industries controlled by the Iranian Revolutionary Guard Corps; this concerns the sale, supply or transfer to Iran of graphite, raw or semi-finished metals (such as aluminium or steel) and software of integrating industrial processes; the prohibition includes related technical or financial assistance - the specific items covered by this prohibition will be announced in a implementing Council Regulation which will be published by the EU in due course
  • prohibition on the sale or supply of key naval equipment and technology for ship-building, maintenance or refit; the specific items covered by this prohibition will be announced in a further Council Regulation
  • ban on the import of natural gas from Iran into the EU; this concerns the import, purchase and transport of gas as well as finance and insurance related to these activities
  • asset freezes against listed individuals and entities and a prohibition of making economic resources available to them (including by the supply of goods and services which may be used to obtain funds)
  • restrictions on transfers of funds to and from Iran, and restrictions on Iran’s access to the insurance and bond markets
  • restrictions on providing certain services on Iranian ships and cargo aircraft
  • prohibition on the supply of vessels designed for the transport or storage of oil and petrochemical products; participation in the construction of new oil tankers for Iran or for Iranian persons or entities is also prohibited; there is also a ban on flagging and classification services for Iranian oil tankers and vessels
  • prohibitions on the import, purchase or transport to EU member states from Iran of crude oil or petroleum products

The restrictive measures apply:

  • to acts carried out within the EU and to the activities of EU entities and nationals overseas
  • to the supply of goods and services directly or indirectly to Iran and to Iranian-owned or controlled entities or bodies outside Iran

The UK government does not encourage trade with, or investment in, Iran and has withdrawn all commercial support for trade. If you decide to trade with Iran, you do so at your own risk. Having weighed up the risks, the final decision on whether to trade with Iran lies with you. However, if your business dealings get into trouble, the government will not be able to assist.

This guide outlines relevant information about the restrictions on the supply of goods and related services to Iran only.

For information on financial sanctions, refer to the HM Treasury website and for information on the restrictions on Iranian ships and cargo aircraft please contact HM Revenue & Customs (HMRC). For restrictions on imports from Iran, refer to the Import Licensing Branch (ILB) part of the Department for Businss, Innovation and Skills (BIS).

Latest updates about Iran sanctions

Export control updates

If you intend to export to Iran you should keep yourself well informed of the current situation through the media and other information channels.

To keep informed with latest updates about arms embargoes and changes to strategic export control legislation, subscribe to the Export Control Organisation’s notices to exporters.

The ECO has issued a number of notices about sanctions imposed on Iran. These include:

Separate notifications are issued about financial and import sanctions by other parts of government. 

Read notifications about financial sanctions from the HM Treasury.

Read notifications about import sanctions issued by the Import Licensing Branch

Iran List

The ‘Iran List’ provides a listing of organisations in Iran of potential concern. See the guide on the Iran List: WMD End-Use Control.

If any exporter wants to export to, or is contacted by, any of the organisations on the Iran List, they should contact the Export Control Organisation (ECO) for specific advice (contact details under ‘further information’ below). If you have any concerns about exporting to an end-user in Iran, you should consider seeking advice from the ECO’s End-User Advice Service. See more information about this service in the guide strategic exports: when to request an export licence.

Restrictions concerning Iran’s nuclear programme

On 16 October 2012, the EU adopted a further set of restrictive measures against Iran as announced in Council Decision 2012/635/CFSP. These measures are targeted at Iran’s nuclear and ballistic programmes and the revenues made from these programmes by the Iranian government. The sanctions measures include:

  • prohibition on the sale, supply or transfer to Iran of graphite, raw or semi-finished metals (such as aluminium or steel) and software for integrating industrial processes. The prohibition includes technical or financial assistance.
  • prohibtion on sale or supply of key naval equipment and technology for ship-building, maintence or refit.

Specific items covered by export bans announced by this new measure will be announced in a further Council Implementing Regulation to be published in due course.

Council Regulation (EU) No 267/2012 of 23 March 2012 is the main legislation imposing restrictions on trade with Iran to reflect the EU’s concerns over the nature of Iran’s nuclear programme. It replaces Council Regulation (EU) No 961/2010.  Download the full text of  Council Regulation (EU) No 267/2012 from the Europa website (PDF, 1.96MB).

Goods whose supply is prohibited for human rights reasons (including equipment and technology which may be used for the monitoring or interception of the internet and telecommunications and related services) are listed in Council Regulation (EU) No 359/2011.

Council Regulation (EU) No 267/2012 contains a range of measures, including those detailed in the Annexes specified below.

Items banned for export

Prohibitions are in place on items listed in Annexes I, II of the Regulation. This concerns the:

  • sale, supply, transfer or export to Iran or to an Iranian entity or body outside Iran of listed dual-use goods and technology
  • provision of brokering services, and the provision of technical and financial assistance, related to the listed goods and technology
  • purchase, import or transport from Iran of listed items
  • investment in and financing of any Iranian person, entity or body engaged in the manufacture of listed items

Annex I is identical to Annex I of the Council Regulation 428/2009 (otherwise known as the EU Dual-Use List). This is with the exception of certain items listed in Category 5 (telecommunications and information security) which are not subject to the prohibition.  The ECO will continue to process licence applications for these Category 5 items in the usual way.

For more details about Council Regulation 428/2009, see the guide on controls on dual-use goods. The EU Dual-Use List forms part of the UK Strategic Export Control Lists.

Annex II is a list of additional dual-use items with significant potential utility to Iran’s nuclear and ballistic missile programmes.

Licensable items

Annex III is a further list of dual-use items which may have utility to Iran’s nuclear and missile programmes. 

  • A licence is required for the sale, supply, transfer or export to Iran or to an Iranian entity or body outside Iran of goods and technology listed in Annex IV
  • A licence is required for the provison of brokering services, of technical or financial assistance related to those items, or for investment in Iranian entities engaged in manufacturing those items

In line with the written minisiterial statement issued on 9 November 2010 by Mark Prisk, Minister of State for Business and Enterprise, a licence for Annex III (previously Annex IV of Council Regulation 961/2010) items will only be issued in exceptional circumstances - such as for humanitarian end-use - where there is manifestly no risk to diversion to Iran’s nuclear activities. Download Notice to Exporters 2010/40 about change to licensing policy of Annex IV (now Annex III) listed items 

Oil & gas restrictions 

Annex IV relates to the prohibitions of import, purchase or transport to EU Member States from Iran of crude oil or petroleum products.

Annex V lists petrochemical products which are banned from import into the EU if they originate in Iran or have been exported from Iran.

Annex VI lists key equipment and technology for the oil and gas industry in Iran, the export or supply of which is prohibited. This includes equipment and technology for:

  • the exploration and production of crude oil and natural gas
  • refining of crude oil and liquefaction of natural gas
  • the petrochemical industry 

Other measures

Annex VII is a listing of gold, precious metals and diamonds.

Council Regulation (EU) 267/2012 also specifies in Article 16 a prohibition on the sale, supply, transfer or export, directly or indirectly of newly printed or unissued Iranian denominated banknotes and minted coinage, to, or for the benefit of the Central Bank of Iran.

Restrictions on items that could be used for internal repression in Iran

The EU sanctions on Iran include human rights measures. These were originally adopted in Council Decision 2011/235/CFSP and implemented in Council Regulation (EU) No 359/2011 on 12 April 2011.

Following a review, the EU Council have renewed the Decision for a further year and also made a number of amendments which were adopted in Council Decision 2012/168/CFSP and Council Regulation (EU) No 264/2012. (which amends Regulation 359/2011). The Decision came into force on 23 March 2012 and the Regulation came into force on 24 March 2012.

Download the full text of  Council Regulation (EU) No 264/2012 from the Europa website (PDF, 1.01MB).

Download the full text of  Council Regulation (EU) No 359/2011 from the Europa website (PDF, 789K). 

Items banned for export

Prohibitions are on place on items listed in Annex III of the Regulation 359/2011 (as amended by Regulation 264/2012):

  • the sale, supply, transfer or export, directly or indirectly of equipment which might be used for internal repression to any person, entity or body in Iran or for use in Iran
  • the provision (direct or indirect) of technical assistance, brokering services, financing or financial assistance related to the above equipment

Both the above listed provisions were previously contained in Annex III in Council Regulation (EU) No 961/2010 which has now been repealed and replaced by Council Regulation No 267/2012. 

Licensable Items

Annex IV is a of equipment, technology or software which may be used for monitoring or interception or telecommunications. A prior authorisation (licence) shall be required:

  • to sell, supply, transfer or export, directly or indirectly items as listed in Annex IV to any person, entity or body in Iran or for use in Iran
  • for the provision of technical assistance, brokering services, financing or financial assistance related to the items listed in Annex IV to any person, entity or body in Iran or for use in Iran
  • for the provision of telecommunication or internet monitoring or interception services of any kind to or for the direct or indirect benefit of Iran’s government, public bodies, corporations and agencies or any person or entity acting on their behalf or at their direction

Restrictions on exporting to or financing Iran’s oil and gas industry

If you are intending to export any items which are listed on Annex VI of Council Regulation (EU) No 267/2012 or to provide brokering services or technical or financial assistance related to those items, you are advised to read this section carefully.

As of 27 October 2010, a range of restrictive measures which apply in the EU on exports to Iran’s oil and gas industry came into effect. These measures were updated on 23 March 2012. The measures target the industry in Iran and Iranian enterprises engaged in those activities outside Iran. The measures could apply to your business if you trade with Iran, or intend to trade in goods or technology relating to:

  • exploration of crude oil and natural gas
  • production of crude oil and natural gas
  • refining of crude oil
  • liquefaction of natural gas
  • petrochemical industry

 In particular Council Regulation (EU) No 267/2012, imposes a prohibition on:

  • the sale, supply, transfer or export of key equipment and technology for the oil and gas industry as listed in Annex VI of the Regulation
  • the provision of brokering services and of technical and financial assistance related to those goods and technology
  • investment (including the granting of any loan or credit facility, the acquisition or extension of a participation and the creation of a joint venture) in any Iranian person, entity or body engaged in the exploration or production of crude oil and natural gas, the refining of fuels or the liquefaction of natural gas and petrochemicals

To gain a fuller understanding, you can download the full text of Council Regulation (No 267/2012 from the Europa website (PDF, 1.98MB).

You should refer to Annex VI in Council Regulation No 267/2012 before you directly or indirectly sell, supply, transfer or export any item from the extensive listing to any Iranian person, entity or body or for use in Iran. 

Contractual exemption

There are specific exemptions from the restrictions on the Iranian oil and gas industry where the supply of goods and services is required by:

  • a trade contract that was in force on or before the 26 October 2010, or is an obligation arising from such a contract
  • in the case of an investment, the contract must have been in place before 26 July 2010

There are additional exemptions for the sale, supply, transfer or export of key equipment and technology for the petrochemical industry provided contracts have been concluded before 23 January 2012.

To benefit from these exemptions you must notify the details of the proposed transaction to the ECO at least 20 working days in advance. The notification must include sufficient details of the relevant contract and the associated transaction(s) to confirm that the exemption does indeed apply.

Please note that the cut-off date for transactions permitted under Article 10 of Council Regulation 267/2012 was 15 April 2013. Notifications after this date will not be considered until further notice.

If the goods and technology you intend to export are not listed on either Annex VI, there is no prohibition on their export under the oil and gas or petrochemcial provisions. However, you will need to check that the items are not controlled or prohibited under any other provision, such as the prohibition on the supply of dual-use goods. You should also check that the entity you are supplying is not subject to asset freeze provisions. 

Fiscal restrictions

In addition to a range of measures to freeze funds and economic resources, restrictions also apply to the financing of any of the prohibited activities relating to the exploration of crude oil and natural gas, production of crude oil and natural gas, refining, or liquefaction of natural gas, whether by an Iranian person, entity or body.

‘Financing’ includes investment, loans or the extension of credit.

More information on financial sanctions on the HM Treasury website.

How to claim a contractual exemption for specific items exported to Iran

Are the items listed in Annex VI?

The first question to address in determining whether you can claim a contractual exemption is whether the items that you intend to supply, or for which you intend to provide technical or financial assistance, are listed in Annex VI of Council Regulation 267/2012. Download the full text of Council Regulation (EU) No 267/2012 from the Europa website (PDF, 1.98MB). 

In most cases, you should be able to determine this yourself, but if you have tried this and really cannot do so, you can get advice from the ECO’s Control List Classification Advice Service.  

Apply for Control List Classification Service advice on the SPIRE website with the BIS. 

Note that this service can only advise whether or not goods or technology are listed in the Annexes to the Regulation. It cannot advise whether or not the contractual exemption applies to a specific transaction. For guidance on how to determine whether the contractual exemption applies, see ‘Exemption’ below.

If the equipment does not feature on Annex VI, there is no bar to exporting or providing assistance under the oil and gas provisions, but you will need to consider further aspects before your export can proceed. These are set out below.

If the equipment does feature on Annex VI, then you may be able to claim exemption from the prohibition - and thus proceed with the transaction - if you have a qualifying contract.

Exemption

The prohibitions do not apply to:

  • transactions required by a trade contract concerning key equipment or technology in the exploration of crude oil and natural gas, production of crude oil and natural gas, refining, liquefaction of natural gas (listed in Parts 1 and 2 of Annex VI) concluded before 27 October 2010
  • ancillary contracts necessary for executing such oil and gas contracts or by a contract or agreement concluded before 26 July 2010  and relating to an investment in Iran made before 26 July 2010
  • transactions required by a contract contract concerning key equipment or technology for the petrochemical industry (listed in Part 3 of Annex VI) concluded before 24 March 2012
  • ancillary contracts necessary for the execution of such petrochemical contracts or by a contract or agreement concluded before 23 January 2012 and relating to an investment in Iran made before 23 January 2012

In each case you also need to notify the relevant competent authority of such transactions at least 20 working days in advance. The UK competent authority is the ECO

What sort of ‘contracts’ can qualify?

Whilst a contract is no more than a binding agreement between two parties to provide goods or services for a consideration, for the purposes of the application of the exemption it will be necessary to provide robust evidence that it exists. Therefore, the contractual obligations must be clearly documented, and copies of such documents will need to be included with the notification to ECO. Relevant contracts can come in many different forms including a ‘purchase order’ or invoice but must:

  • be in written form (verbal contracts will not qualify)
  • include consignor, consignee and customer / end-user details as appropriate
  • have a date of issue
  • provide details of the transaction including the equipment or technology, or technical or financial assistance, to be provided

For more insight into when a contractual exemption might apply or not, see the page in this guide concerning frequently asked questions about sanctions on Iran.

Remember that ECO is the point to which contracts for which exemption is to be claimed are notified, along with satisfactory supporting evidence. ECO then examines the claim, gives a view on whether, on the evidence provided, your contract qualifies and notifies you of that view. The prime responsibility however, lies with you to determine whether a claim for exemption is warranted before contacting the ECO. If you are unsure whether or not you have a qualifying contract you should seek your own legal advice. 

If my contract is approved, does that give me the right to complete the transaction?

Not necessarily. If you know, have reason to suspect, or have been informed by the ECO that what you intend to supply might contribute to Iran’s WMD programme, then you will need to apply for an export licence from ECO. Such a licence may be refused regardless of whether you have a qualifying contract. For more details see the associated guidance on End-Use Controls.

Any supply to an Iranian person or entity listed in Annexes VIII or IX of the Regulation is also prohibited, because that would represent the provision of economic resources to one of those entities and this is prohibited under the financial sanctions against Iran for which HM Treasury is the competent authority.

Submitted export licence applications

The oil and gas restrictions are not a licensing regime. The export of these goods is prohibited and you should not submit export licence applications for items listed in Annex VI. 

However, if, for other reasons, you have already submitted a licence application that includes items listed in Annex VI, you will be advised that the export of those items is prohibited unless you can demonstrate contractual exemption. Please refer to the notification section above.

Restrictions on arms exports and end-use controls on Iran

Arms embargo

There is an arms embargo imposed against Iran.

This embargo is a ban on the export or supply of ‘arms and related material’ (ie military weapons, ammunition and equipment). The UK interprets the arms embargo on Iran as covering all goods and items on the UK Military List (which forms a part of the UK Strategic Export Control Lists).

End-Use Controls

If your items are not listed specifically as a result of specific sanctions regulations, you may still need a licence under so-called ‘End-Use Controls’. This aspect of export controls covers licensing of items that might potentially be used in a WMD programme or military goods.

These controls are outlined in Article 4 of Council Regulation 428/2009 (the EU Dual-Use Regulation) and in the ECO 2008. For more details see the guide, Overview of export control legislation.

For more information on End-Use Controls, see the guide on WMD End-Use Control and Military End-Use Control.

The ‘Iran List’ provides a listing of organisations in Iran of potential concern. See the guide on the Iran List: WMD End-Use Control. If you have any concerns about exporting to an end-user in Iran, you should consider seeking advice from the ECO’s End-User Advice Service. See more information about this service in the guide strategic exports: when to request a licence.

Applying for an export licence to Iran

Exporters can apply for an export licence for their goods or for other transactions subject to control. All applications will be considered by the government on a case-by-case basis in line with the provisions of the Consolidated EU and National Arms Export Licensing Criteria. Read the guide on assessment of export licence applications: criteria and policy.

However, many of the restrictions against Iran are prohibitions. That means that there is a complete ban on supply to Iran. Licences will not normally be issued where there is a prohibition in place. While there are some limited exemptions to the prohibitions, the ECO would expect to issue an export licence only in exceptional circumstances in line with the relevant exemption and after careful assessment on a case-by-case basis against the Criteria.

Licences for items listed on Annex III of Council Regulation (EU) No 267/2012 (previously Annex IV of Council Regulation 961/2010) will only be issued in exceptional circumstances as announced by Mark Prisk, Minister of State for Business and Enterprise on 9 November 2010. For more details, download Notice to Exporters 2010/40 about change to licensing policy of Annex IV listed items.

Further licensing guidance

For details on different export licences available see the guide on licences: export, trade control and transhipment.

If you are applying for or using any type of export licence, you will need to ensure that you are complying with the requirements of your licence and that you are meeting all of your responsibilities. For more information, see the guide on compliance and enforcement of export controls.

If you have any concerns about exporting to an end-user in Iran, you should consider seeking advice from the ECO’s End-User Advice Service. See more information about this service in the guide strategic exports: when to reqest an export licence. 

All export licences are considered on a case by case basis with reference to the Consolidated EU and National Arms Export Licensing Criteria, taking into account the prevailing circumstances at the time of the application. In particular, Criteria 1 and 2 will be applied to applications relating to exports of this nature. See the guide on assessment of export licence applications - criteria and policy. 

Iran sanctions key legislation

The arms embargo on Iran has been imposed by UN and EU laws, and adopted in the UK’s laws.

UN Security Council Resolutions

UN Resolution 1737 was adopted by the Security Council in December 2006. This embargo imposed a ban on the export to and import from Iran of certain technologies relating to nuclear weapons and missiles. This resolution has subsequently been extended, amended and modified by Resolution 1747 which extends the export ban to all arms and related material. Most recently the UN has imposed Resolution 1803(2008) and Resolution 1929 (2010) which further extends the embargo.

You can find copies of relevant UN Resolutions on the UN website.

EU legislation

The Council of the European Union implemented UN Security Council Resolution (UNSCR) 1737 by means of EC Regulation 423/2007 in February 2007. Following the adoption of UNSCR 1929, the European Council announced in its Declaration of 17 June 2010 that it would take further measures against Iran. These measures were confirmed by Council Decision 2010/413/CFSP of 26 July 2010.

Subsequently, Regulation 423/2007 was repealed and replaced by Council Regulation (EU) 961/2010 of 25 October 2010 which came into force on the 27 October 2010.

On 23 January 2012 the EU adopted new sanctions measures on Iran in Council Decision 2012/35/CFSP. This amends Council Decision 2010/413/CFSP.

On 23 March 2012, the EU adopted new implementing legislation - Council Regulation (EU) No 267/2012 (which repeals Regulation (EU) No 961/2010).

In response to the deteriorating human rights situation in Iran, the EU have also adopted Council Regulation (EU) No 359/2011 of 12 April 2011. This regulation has been amended by Council Regulation (EU) No 264/2012, which includes the Annex III list of equipment which might be used for internal repression and related services (eg financial, technical, brokering) and internet monitoring and telecommunications equipment and related services.

On 16 October 2012, the EU adopted new Council Decision 2012/635/CFSP. Specific details concerning export bans announced by this measure will be made in a further Council Implementing Regulation which will be published by the EU in due course.

You can access Common Foreign and Security Policy (CFSP) legislation on the Europa website.

UK legislation

The UK has had a national arms embargo in place on Iran since March 1993. The relevant statutory instruments implemented and in force in UK law are:

  • Export Control Order 2008 (SI 2008/3231) - Iran is a destination listed in this Order under Schedule 4, Part 1 (Countries and Destinations subject to stricter export of trade controls)
  • the Export Control (Iran Sanctions) Order 2012 (SI 2012/1243) - this is national legislation to provide for licensing, enforcement and penalty provisions in respect of EU Council Regulations 264/2012 and 267/2012 of 23 March 2012
  • the Iran (UN Sanctions) Order 2009 (SI 2009/886) as amended by the Iran (United Nations Sanctions Amendment) Order 2010 (SI 2010/2978) and the Iran (UN Sanctions Amendment) Order 2011 (SI 2011/2985)

For more information, see the guide on the Export Control Order. You can download copies of all UK legislation from the Legislation.gov.uk website.

Other restrictions on Iran

Iran is also subject to other sanctions.

These sanctions include:

  • a ban on certain investments
  • measures to freeze funds and economic resources
  • restrictions on giving financial assistance or concessional loans to the Government of Iran or to any listed targeted persons and entities
  • restrictions on financing of any of the prohibited activities relating to the exploration, production, refining or liquefaction of oil and gas by any Iranian person, entity or body 
  • restrictions on transfers of funds to and from Iranian persons, entities or bodies
  • restrictions on provisions of financial services and on insurance/re-insurance services
  • restrictions on provisions of certain services to Iranian vessels and cargo aircraft

You can:

Further information

UK Trade & Investment (UKTI) Enquiry Line

020 7215 8000

BIS ECO Helpline

For general export control queries please contact the ECO Helpline on 020 7215 4594 or email: eco.help@bis.gsi.gov.uk

Download the full text of Council Decision 2012/635/CFSP from the Europa website (PDF, 1.03 MB)

Download the full text of Council Regulation (EU) No 267/2012 from the Europa website (PDF, 1.98 MB)

Download the full text of Council Regulation (EU) No 264/2012 from the Europa website (PDF, 1.01 MB)

Subscribe to the Export Control Organisation’s Notices to Exporters

A to Z countries listing on the UKTI website

ECO performance reports and statistics on the ECO Reports and Statistics website

Security Council resolutions on the UN website

CFSP legislation on the Europa website

Official Journal of the EU on the Europa website

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