Central Bank of Iran

Iran’s Central Bank says to introduce company for facilitating INSTEX

Tasnim – The Central Bank of Iran (CBI) announced that it will soon name a company in the country for facilitating cooperation with the European Union based on its financial mechanism for trade with Iran known as the Instrument in Support of Trade Exchanges (INSTEX).

In a statement released on Saturday, the CBI’s public relations department said although INSETX is much less than what had been pledged by the EU to save the 2015 nuclear deal after the US withdrawal, Iran will soon introduce a corresponding company to demonstrate its intention to interact.

The establishment process of the company is underway and it will be introduced for cooperation with Europe, the statement read.

The CBI also welcomed a Friday decision by the Paris-based Financial Action Task Force (FATF) to extend the deadline for Iran until June 2019 to strengthen its anti-money laundering legislation, suspending counter-measures against Iran for another 4 months.

Last October, the global watchdog had given Iran until February to complete reforms or face consequences.

“The FATF decided at its meeting this week to continue the suspension of counter-measures,” it said in a statement on Friday.

On February 4, Council of the European Union issued a conclusion on the Islamic Republic, urging Iran to “adopt and implement the necessary legislation pursuant to its commitments under the Financial Action Task Force (FATF) Action Plan.”

The EU also voiced readiness to “continue cooperation with Iran in these areas, including by providing technical assistance for the implementation of the FATF Action Plan.”

Earlier on the same day, Iranian Judiciary Chief Ayatollah Sadeq Amoli Larijani stressed that the country would never accept the “humiliating conditions” of the European Union’s financial mechanism for trade with Iran, including Iran’s accession to FATF.

“The European countries have reportedly set two ‘strange conditions’ for the mechanism named the INSTEX,” the top judge deplored, saying, “The countries should be aware that Iran will by no means accept these humiliating conditions and will not accede to any demand at the expense of opening a small waterway such as INSTEX.”

INSTEX will be based in Paris and be managed by a German banking expert. Britain will head the supervisory board.

The European countries are reportedly going to use the channel initially only to sell food, medicine and medical devices in Iran.

In May 2018, the US president pulled his country out of the JCPOA, the nuclear deal that was achieved in Vienna in 2015 after years of negotiations among Iran and the Group 5+1 (Russia, China, the US, Britain, France and Germany).

Following the US exit, Iran and the remaining parties launched talks to save the accord.