Wednesday, May 26, 2021
In May 2018 the United States announced the reinstitution of sanctions against Iran that had previously been lifted pursuant to the Joint Comprehensive Plan Action (“JCPOA”).[1]
The U.S. sanctions on Iran that were revived by the U.S. action in 2018 include many that apply extraterritorially. Moreover, U.S. law allows the government to impose sanctions on non-U.S. persons (such as European companies) if the U.S. Treasury Department makes a finding that the non-U.S. person has provided goods or services in support of a Specially Designated National of Iran (such as Bank Melli Iran).
In November 2018 the German branch of Bank Melli Iran was notified by Telekom Deutschland GmbH that it was terminating its contract for telecommunication services to the Bank. Bank Melli responded to the termination by filing a lawsuit in Germany,
Thursday, May 20, 2021
Takeaways
The new law takes effect in later in 2021, but UK Government may look back at deals from November 2020 onward.
The Act is considered one of the most far-reaching systems in the world, carrying civil and criminal penalties for a failure to notify.
A notifiable acquisition completed without the approval of the Secretary of State is void (of no legal effect).
The UK Government has stated that it will work closely with investors to help ease the market into the new framework of investment rules.
In the broader context of governments all over the world scrutinizing foreign direct investments (“FDI”), the Act is meant to legislatively reform the UK national framework of transaction review, give the UK Government more power to investigate, and strengthen its control over FDIs that may implicate national security issues.