The US State Department reacted to the creation of a new trading system called the Instrument in Support of Trade Exchanges (INSTEX) between Iran and the EU, saying it was “closely following” reports on the European mechanism.
“As the president has made clear, entities that continue to engage in sanctionable activity involving Iran risk severe consequences that could include losing access to the US financial system and the ability to do business with the United States or US companies,” the State Department added in its Thursday statement, according to its official website.
INSTEX is to be headquartered in Paris and overseen by a German banker.
EU Foreign Policy chief Federica Mogherini welcomed the registration of the SPV.
“The lifting of sanctions is an essential dimension of the JCPOA (Joint Comprehensive Plan of Action), the Iran nuclear deal. The instrument launched today will provide economic operators with the necessary framework to pursue legitimate trade with Iran,” said a statement from Mogherini’s office.
Late on Thursday, Britain, France and Germany on Thursday issued a joint statement on the creation of the new trading system and said, “INSTEX will support legitimate European trade with Iran, focusing initially on the sectors most essential to the Iranian population — such as pharmaceutical, medical devices and agri-food goods”.
Iranian Foreign Minister Mohammad Javad Zarif also hailed the new measure and said Iran remained “ready for constructive engagement with Europe on equal footing and with mutual respect.”