Germany, France and Britain to set up European transactions channel with Iran

Iran's Deputy Foreign Minister Abbas Araghchi who is also a senior nuclear negotiator speaks with media in his press conference in Tehran Iran

Iran's Deputy Foreign Minister Abbas Araghchi who is also a senior nuclear negotiator speaks with media in his press conference in Tehran Iran

Britain, France and Germany are to launch a mechanism to allow European Union companies to continue trading with Iran, bypassing U.S. sanctions.

Washington's major European allies opposed last year's decision by US President Donald Trump to abandon the 2015 deal, under which global sanctions on Iran were lifted in return for Tehran accepting curbs on its nuclear program.

The three countries - the European signatories to the 2015 deal that curbed Tehran's nuclear ambitions in return for sanctions relief - launched the device, which has been in preparation for months, at a meeting of EU foreign ministers in Bucharest.

The Instrument in Support of Trade Exchanges, or INSTEX, will initially be used to facilitate the sale of food, medicine and medical devices - all humanitarian goods that the USA government has previously said it has no problem with.

Britain's Jeremy Hunt said the three countries were working closely with Tehran to finalize arrangements: "Registration is a big step, but there is still more work to be done", Hunt said.

Washington says that although Iran complied with the terms of the deal, the accord was too generous, failing to rein in Iran's missile programme or curb its regional meddling.

Iran will pay for the products via barter instead of using dollars, as most of its banks, including the Iranian central bank, were cut off from the SWIFT global financial network after the US pulled out from the nuclear deal with Iran last May.

France, Germany and the United Kingdom created a state company, known as a "special objective vehicle", to allow Iran to continue to trade vital goods like medicine and food, according to German media reports.

Iran cautiously welcomed the news as a "first step" but United States officials dismissed the idea that the new entity would have any impact on efforts to exert economic pressure on Tehran, and fired a fresh warning at anyone thinking of trading with the Islamic republic.

Coldest night of winter predicted amid Met Office snow and ice warnings
Mobile phone coverage could also be affected in rural communities, as well as a "small chance" of power cuts due to the weather. Commuters in many parts of the country were warned to leave work early on Thursday to ensure they got home.

A group of protesters chant slogans at the main gate of old grand bazaar in Tehran, Iran, Monday, June 25, 2018.

Iran has recently met with eight other leading nations to consider implementing a national cryptocurrency to circumvent US imposed sanctions.

A UN Security Council resolution enshrined Iran's 2015 nuclear deal with Britain, China, France, Germany, Russia and the United States in which Tehran curbed its uranium enrichment programme in exchange for an end to global sanctions.

The Brussels-based Society for Worldwide Interbank Financial Telecommunication, or SWIFT, blocked Iranian access to the global financial transaction system shortly after America reimposed its second round of sanctions in November.

Tehran has grown frustrated with the slow European response to the reimposition of United States sanctions, but has pledged to maintain its nuclear deal commitments so long as it receives the promised economic benefits.

A U.S. Embassy spokesperson in Germany warned that companies engaging in "sanctionable activity involving Iran risk severe consequences" but said the new organization would not in any way affect the U.S. campaign to apply maximum financial pressure on Iran.

The new entity acts as a sort of euro-denominated clearing house for Iran to conduct trade with European companies. The undiplomatic response by the Iranians came in response to a European demand that the Islamic Republic end its ballistic missile tests and stop its terror plots on European soil.

The US has also threatened to punish British, Dutch, French and German companies taking part in Russia's plan to build a new gas pipeline to Germany, called Nord Stream 2.

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