Britain, France and Germany have launched a European mechanism that allows the countries to trade with Iran, circumventing the US sanctions imposed on the Middle Eastern nation.
America’s biggest European allies were strongly opposed to US President Donald Trump’s decision to abandon the 2015 Iranian nuclear deal, which saw sanctions on Tehran lifted on the premise that it would curb its nuclear programme.
Iran has threatened to leave the deal unless European countries help it receive economic benefits. European leaders have said they would help companies trade in with Iran as long as it kept to the deal.
The UK Foreign Office said the Instrument for Supporting Trade Exchanges (INSTEX), was a “new mechanism for facilitating legitimate trade between European entities and Iran”.
Foreign secretary Jeremy Hunt said the new vehicle would be applicable to food, pharmaceuticals and consumer goods – meaning Iran’s main source of foreign exchange, oil, would not be covered.
In a statement, the US Embassy in Berlin said it did not expect the new payments system to “in any way impact our maximum economic pressure campaign” against Iran.