In its latest round of sanctions against Iran, the U.S. Treasury Department targeted two firms based in Shanghai, China and Kuala Lumpur, Malaysia.
Both firms are accused of trading in export-sensitive goods and concealing that the buyers were Iranian firms barred under previous sanctions. And both firms risk having their any U.S.-based assets frozen and losing business ties with banks and companies under U.S. jurisdiction.
One of the firms is a large manufacturing and global trader with a business office in Shanghai, China.
Bochuang Ceramic, Inc., makes and sells a specialized chemical that can be used in military weapons, such as torpedoes, mines, aircraft and surveillance. According to Treasury, Bochuang Ceramic sold hundreds of thousands of dollars worth of sensitive chemical material to an Iranian firm named Electronic Components Industries, through a middleman. The mediator was an Iran-based firm named Pardazan System Namad Arman (PSNA).
In a similar vein, a telecommunications firm based in Kuala Lumpur, Malaysia is also on the new list. According to the Treasury department, Green Wave Telecommunication, acquired export-controlled technology in the United States and shipped it to an Iranian-based company sanctioned in October 2017.
“As a result of this action, all property and interests in property of those designated today subject to U.S. jurisdiction are blocked, and U.S. persons are generally prohibited from engaging in transactions with them,” the Treasury Department statement read.
Secondary sanctions target companies that do business with individuals, firms or government branches that are already on a sanctions list. They pose a risk for traders and bankers who unknowingly deal with sanctioned entities through their supply chains. Treasury’s Office of Foreign Assets Control regulates the dealings.
Another firm, Wuhan Sanjiang Import and Export Co., became subject to U.S. sanctions in October 2017. It had sold navigation-related equipment to an Iranian electronics industry, which fell under U.S. sanctions in 2008.
The import-export company has annual sales ranging from $20 million to $25 million, according to Global Sources.
Targeting Weapons Proliferation
The new sanctions are not directly related to the 2015 nuclear deal, JCPOA. On January 12, President Trump certified that Iran is complying with requirements under the deal. However, he continued to threaten to withdraw from the deal unless new restrictions are added. Specifically, he called on European signatories Britain, France and Germany to bar Iran from enriching uranium beyond 2025 and crack down on its ballistic missile program. Trump is required by U.S. law to review Iran’s compliance with the nuclear deal every 90 days.
The new sanctions primarily deal with restrictions against doing business with firms involved in selling weapons of mass destruction. Those sanctions come from an executive order former U.S. President Bush signed in 2005. (See more Executive Order 13382.)
However, the statement also cites “serious human rights abuses and censorship” in Iran. In total, it 14 Iranian individuals, including an Iranian judiciary chief, and two Chinese nationals.
Iran’s Ministry of Foreign Affairs issued a statement calling the sanctions against the judiciary chief a “hostile and illegal move.” It further called the reference to human rights a “disgrace to civilized nations and modern rule” and vowed to respond to the actions “in due time.”by sanctions