Iranian frozen assets in international accounts are calculated to be worth between $100 billion [1] [2] and $120 billion. [3] [4] [5] Almost $2 billion of Iran's assets are frozen in the United States. [6] According to the Congressional Research Service, in addition to the money locked up in foreign bank accounts, Iran's frozen assets include real estate and other property. The estimated value of Iran's real estate in the U.S. and their accumulated rent is $50 million. [1] Besides the assets frozen in the U.S., some parts of Iran's assets are frozen around the world by the United Nations. [1]
As of January 2021, Iran had frozen assets in the following countries: $7 billion in South Korea; $6 billion in Iraq; $20 billion in China; $1.5 billion in Japan; $1.6 billion in Luxembourg. [7]
Iran's assets were first frozen by U.S. president Jimmy Carter in 1979, after revolutionaries overthrew the U.S.-allied Mohammad Reza Shah Pahlavi's administration and took American hostages. After the Iranian Revolution in 1979, the United States ended its economic and diplomatic ties with Iran, banned Iranian oil imports and froze approximately 11 billion 1980-US dollars of its assets. [8]
Many of the assets were then unfrozen in 1981 after the Algiers Accords were signed and the hostage crisis ended.[ dubious – discuss ] At the time of the 1979 revolution, the Pentagon re-sold some $400 million in Iranian military equipment already paid for by the deposed government, and the money was "placed in an escrow account". [1]
Much of the frozen cash includes Iran's income from selling a limited amount of oil prior to the lifting of the sanctions, when Iran could legally sell oil but could not transfer the money back to Iran, because doing so was illegal under U.S. sanctions. [2]
Some pages of the JCPOA were dedicated to the listing of individuals and entities whose assets would be unfrozen. [1] According to Nader Habibi, a professor of economics at Brandeis University, JCPOA will lead to the release of only about $30 billion worth of assets; a similar figure of about $32 billion was estimated by Valiollah Seif, the chief of Iran's central bank. [2]
According to the Washington Institute in 2015: [9] "...the pre-deal asset freeze did not have as much of an impact on the Iranian government as some statements from Washington suggested. And going forward, the post-deal relaxation of restrictions will not have as great an impact as some critics of the deal suggest."
The US government also has seized a Manhattan skyscraper belonging to the Iranian government worth over a billion US dollars.
Deborah Peterson and other plaintiffs brought a lawsuit in U.S. federal court against the Islamic Republic of Iran, and obtained a judgments against Iran for its role in the 1983 Beirut barracks bombings (in which 241 U.S. peacekeepers were killed) and for other acts of international terrorism. While foreign states usually enjoy immunity from claims in court, the plaintiffs invoked an exception to the Foreign Sovereign Immunities Act of 1976 that allows foreign states to be held liable for acts of state-sponsored terrorism. [10] The central bank of Iran, Bank Markazi, challenged the execution of the judgment on various grounds. However, in 2012, Congress passed, and President Barack Obama signed, the Iran Threat Reduction and Syria Human Rights Act of 2012, which specified that the judgment in the Peterson et al. v. Islamic Republic of Iran et al. would be subject to execution and also abolished Bank Markazi to the execution of judgment. [10] Bank Markazi challenged this statute as unconstitutional, arguing that Congress had unduly interfered with a judicial function by intervening in a specific case; however, the U.S. Supreme Court, in Bank Markazi v. Peterson , ruled 7-2 that Congress's act was constitutional. [10]
Iran had denied any involvement in any of the bombings. [11] Iranian president Hassan Rouhani called the action "blatant robbery". [12]
Since 1980, Iran has demanded that the US, European Union, and South Korea return all of the frozen assets to Iran, but their demands have largely been ignored. [13] Some of the seized assets have been resold to third parties, while many have been given to families of victims of the regime. [14] For example, in October 2020, $1.4 billion of frozen cash were awarded in punitive and compensatory damages to the family of Robert Levinson after his abduction and presumed death. [15] The return of assets to Iran has also been used as a negotiating tool by the United States. For example, in September 2023, the United States granted Iran access to nearly $6 billion of frozen assets in South Korea as part of a prisoner exchange. [16]
Iran and the United States have had no formal diplomatic relations since 7 April 1980. Instead, Pakistan serves as Iran's protecting power in the United States, while Switzerland serves as the United States' protecting power in Iran. Contacts are carried out through the Iranian Interests Section of the Pakistani Embassy in Washington, D.C., and the US Interests Section of the Swiss Embassy in Tehran. In August 2018, Supreme Leader of Iran Ali Khamenei banned direct talks with the United States.
Bank Melli Iran is the first national and commercial retail bank of Iran. It was considered as the largest Iranian company in terms of annual income with a revenue of 364 657 billion Rials in 2016. It is the largest bank in the Islamic world and in the Middle East. By the end of 2016, BMI had a net asset of $76.6 billion and a network of 3.328 banking branches; so it was known as the largest Iranian bank based on the amount of assets. The brand of BMI was recognized as one of the 100 top Iranian brands in 10th National Iranian Heroes Championship in 2013. The National Bank has 3328 active branches inside, 14 active branches and 4 sub-stations abroad, and it has 180 booths. The first managing director of BMI was Kurt Lindenblatt from Germany, the first foreign branch of BMI was opened in Hamburg, Germany in 1948.
The Central Bank of the Islamic Republic of Iran, also known as Bank Markazi, was established under the Iranian Banking and Monetary Act in 1960, it serves as the banker to the Iranian government and has the exclusive right of issuing banknote and coinage. CBI is tasked with maintaining the value of Iranian rial and supervision of banks and credit institutions. It acts as custodian of the National Jewels, as well as foreign exchange and gold reserves of Iran. It is also a founding member of the Asian Clearing Union, controls gold and capital flows overseas, represents Iran in the International Monetary Fund (IMF) and internationally concludes payment agreements between Iran and other countries.
Mohammad Javad Zarif is an Iranian career diplomat and academic. He was the foreign minister of Iran from 2013 until 2021 in the government of Hassan Rouhani. During his tenure as foreign minister, he led the Iranian negotiation with P5+1 countries which produced the Joint Comprehensive Plan of Action on 14 July 2015, lifting the economic sanctions against Iran on 16 January 2016. On 25 February 2019, Zarif resigned from his post as foreign minister. His resignation was rejected by Ali Khamenei and he continued as foreign minister.
The United States has since 1979 applied various economic, trade, scientific and military sanctions against Iran. United States economic sanctions are administered by the Office of Foreign Assets Control (OFAC), an agency of the United States Department of the Treasury. As of 2017, United States sanctions against Iran include an embargo on dealings with the country by the United States, and a ban on selling aircraft and repair parts to Iranian aviation companies.
Iran–Switzerland relations are foreign relations between the Islamic Republic of Iran and the Swiss Confederation.
There have been a number of international sanctions against Iran imposed by a number of countries, especially the United States, and international entities. Iran was the most sanctioned country in the world until it was surpassed by Russia, following Russia's invasion of neighboring Ukraine in February 2022.
The Joint Comprehensive Plan of Action, commonly known as the Iran nuclear deal or Iran deal, is an agreement on the Iranian nuclear program reached in Vienna on 14 July 2015, between Iran and the P5+1 together with the European Union.
The Iran nuclear deal framework was a preliminary framework agreement reached in 2015 between the Islamic Republic of Iran and a group of world powers: the P5+1 and the European Union.
Bank Markazi v. Peterson, 578 U.S. 212 (2016), was a United States Supreme Court case that found that a law which only applied to a specific case, identified by docket number, and eliminated all of the defenses one party had raised does not violate the separation of powers in the United States Constitution between the legislative (Congress) and judicial branches of government. The plaintiffs, in the case had initially obtained judgments against Iran for its role in supporting state-sponsored terrorism, particularly the 1983 Beirut barracks bombings and 1996 Khobar Towers bombing, and sought execution against a bank account in New York held, through European intermediaries, on behalf of Bank Markazi, the Central Bank of the Islamic Republic of Iran. The plaintiffs obtained court orders preventing the transfer of funds from the account in 2008 and initiated their lawsuit in 2010. Bank Markazi raised several defenses, including that the account was not an asset of the bank, but rather an asset of its European intermediary, under both New York state property law and §201(a) of the Terrorism Risk Insurance Act. In response to concerns that existing laws were insufficient for the account to be used to settle the judgments, Congress added an amendment to a 2012 bill, codified after enactment as 22 U.S.C. § 8772, that identified the pending lawsuit by docket number, applied only to the assets in the identified case, and effectively abrogated every legal basis available to Bank Markazi to prevent the plaintiffs from executing their claims against the account. Bank Markazi then argued that § 8772 was an unconstitutional breach of the separation of power between the legislative and judicial branches of government, because it effectively directed a particular result in a single case without changing the generally applicable law. The United States District Court for the Southern District of New York and, on appeal, the United States Court of Appeals for the Second Circuit both upheld the constitutionality of § 8772 and cleared the way for the plaintiffs to execute their judgments against the account, which held about $1.75 billion in cash.
The Joint Comprehensive Plan of Action, more commonly known as the Iran nuclear deal, was the international agreement reached on Iran's nuclear program in Vienna in 2015. The deal, made after several years of negotiation, set in place strict guidelines to regulate and oversee the Iranian nuclear program including the reduction of centrifuges, enriched uranium stockpiles, and an agreement to allow regular inspections of nuclear sites, among other aspects. The deal has attracted enormous criticism by certain political and media elements in the United States and Iran as the deal is viewed as conciliatory in nature by some factions in both countries. For example, President Donald J. Trump called the Iran deal, "the worst deal ever negotiated" and United States Senate Majority Leader Mitch McConnell characterized it as "flawed", while hardliners in Iran have indicated a desire to subvert it. Much of the criticism in the United States has been centered on the issue of appeasement and Iran's compliance, while in Iran many of the criticisms revolve around the issue of sovereignty and non-nuclear restrictions.
The United States announced its withdrawal from the Joint Comprehensive Plan of Action (JCPOA), also known as the "Iran nuclear deal" or the "Iran deal", on May 8, 2018. The JCPOA is an agreement on Iran's nuclear program reached in July 2015 by Iran and the P5+1 also called E3/EU+3.
Alleged Violations of the 1955 Treaty of Amity, Economic Relations, and Consular Rights is the formal name of a case in the International Court of Justice (ICJ). Iran filed a lawsuit with the Hague-based ICJ against the United States, on 16 July 2018, mainly based on the 1955 Treaty of Amity signed between the two sides on 15 August 1955 and entered into force in 1957, well before the Islamic revolution of Iran. Iranian officials alleged that U.S. re-imposition of the nuclear sanctions was a violation of the treaty. Iran also filed a request for provisional measures. In response, the United States asserted that the lawsuit as "baseless" and vowed to oppose it. Almost a month later, the ICJ heard the provisional measures request. On 3 October 2018, the International Court of Justice issued a provisional measures order requiring the United States "to lift sanctions linked to humanitarian goods and civil aviation imposed against Iran."
The Joint Comprehensive Plan of Action, commonly known as the Iran nuclear deal or Iran deal, is an agreement on the Iranian nuclear program reached in Vienna on 14 July 2015 between Iran, the P5+1, and the European Union.
Certain Iranian Assets is the formal name of a case in the International Court of Justice (ICJ). The application was lodged by Iran against the United States on 14 June 2016, on grounds of violation of Treaty of Amity, Economic Relations and Consular Rights, shortly after Bank Markazi v. Peterson was decided by the United States Supreme Court. The Iranian case seeks the unfreezing and return of nearly $2 billion in assets held in the United States. The case focuses specifically on assets seized from the Iranian national bank, Bank Markazi. These funds were seized to compensate victims of a 1983 suicide bombing of a Marine Corps base in Beirut, Lebanon, which has been tied to Iran. The attack killed more than 300 and injured many more, including U.S. military members. Iran has argued in the case that, among other things, the United States has failed to accord Iran and Iranian state-owned companies, and their property, sovereign immunity, and failed to recognize the juridical separateness of Iranian state-owned companies.
Marik String is an American attorney, national security expert, and U.S. Navy officer, who served as Acting Legal Adviser of the U.S. Department of State from 2019 to 2021.
The seizure of the Hankuk Chemi refers to the temporary seizure of the South Korean oil tanker Hankuk Chemi (한국케미) by the Islamic Republic of Iran in the Persian Gulf on 4 January 2021. Iran's Islamic Revolutionary Guard Corps Navy (NEDSA) stated that the tanker was seized because of "environmental and chemical pollution concerns." The tanker's South Korean owner denied any pollution had occurred. The ship was released on 9 April 2021 after South Korea agreed to unfreeze $1 billion in Iranian assets held in South Korean banks.
Seven resolutions have been approved by the United Nations Security Council (UNSC) relating to the nuclear program of Iran, although the only one currently in force is Resolution 2231, passed on 20 July 2015 endorsing the Joint Comprehensive Plan of Action on the Iranian nuclear program. It sets out an inspection process and schedule while also preparing for the removal of United Nations arms sanctions against Iran. In August 2020, the U.S. released a proposal to extend the UN arms embargo on Iran in the UN.
Maximum pressure campaign refers to the intensified sanctions against Iran by the Trump administration after the United States exited the Joint Comprehensive Plan of Action (JCPOA) in 2018. The campaign was aimed at pressuring Iran to renegotiate the JCPOA, adding more restrictions on Iran's nuclear program and expanding the scope of the agreement to cover Iran's ballistic missiles as well as other regional activities. This strategy was faced by Iran's counter pressure policy to thwart the U.S. maximum pressure campaign.
Following the full declaration of the Russian invasion of Ukraine, which started on 24 February 2022, institutions such as the United States, the European Union, and other Western countries introduced or significantly expanded sanctions covering Russian President Vladimir Putin, other government members and Russian citizens in general. Some Russian banks were banned from using the SWIFT international payments system. The sanctions and the boycotts of Russia and Belarus have impacted the Russian economy in various ways.