10 Dec 2018
In order to ease trade with Iran in spite of the US sanctions, Germany and France will be hosting the EU’s trade mechanism – according to Wirtschaftswoche, a German weekly business news magazine.
The mechanism is said to be limited to trade in humanitarian goods, which include food and medicinal goods, but Iranian Foreign Minister Zarif emphasised on oil sales also forming part of the trade mechanism.
According to the German report, the company will be based in France and chaired by Germany.
Nine countries are reportedly interested in joining the Special Purpose Vehicle – including Italy, Spain, Austria, Belgium, the Netherlands and Luxembourg. However, the risk of US retaliation discouraged Austria, Luxembourg and Belgium, which were the three other potential candidates, from hosting the SPV.
The SPV has a high political value for Europeans, seeing as it forms part of the EU aiming to keep Iran in a nuclear deal which the US withdrew from in May. In order to keep trade moving smoothly with Iran in spite of US sanctions, another payment channel was offered. The SPV would allow a European exporter to Iran to be paid by a European importer from Iran, and will first start as a small entity – potentially obtaining a banking license in due time.
The German magazine quotes a diplomat as having said: "It is important for us to defend the interests of our companies and to underpin our economic independence from the US.”