The administration of US President Donald Trump has turned down a request by the three largest EU member states, Germany, France, and the UK, to make EU companies doing business with Iran exempt from the upcoming American sanctions over the Iranian nuclear program.

In May 2018, Trump abandoned the 2015 Iranian nuclear deal, and ordered that US sanctions be re-imposed on Iran as of August.

The July 2015 Iranian nuclear deal (known as the Joint Comprehensive Plan of Action, JCPOA) was signed by Iran and six other powers (US, China, Russia, UK, France, and Germany, with the involvement of the EU) to ensure that its nuclear program is for peaceful purposes only, and not for the development of nuclear weapons.

The agreement was championed by former US President Barack Obama and his Administration as one of its landmark foreign policy achievements. However, it came under severe criticism by the new US President Donald Trump long before his election and inauguration. The Iranian nuclear deal has been heavily criticized by some Republican members of the US Congress.

In spite of Trump’s decision to restore the American sanctions, the UK, France and Germany have vowed to keep upholding the 2015 deal, and to work to compensate the effect of the sanctions. Iran has also declared willingness to stay in the agreement if it gets the promised economic benefits.

Yet, key EU companies such as Total and Peugeot have begun to scale down their operations in Iran for fear of their US business being affected by sanctions.

The foreign and finance ministers of the UK, France, and Germany sent a letter to the Trump administration on June 4, 2018, asking for the exemption of EU companies from the future Iranian sanctions.

However, US Secretary of State Mike Pompeo and Treasury Secretary Steven Mnuchin have now responded negatively to the European request, and have declared the US will seek to exert “unprecedented” economic pressure on the Tehran regime, NBC News reports citing unnamed US and Western officials.

Pompeo and Mnuchin made it clear that the US government would allow only limited exemptions from the future sanctions against Iran based on national security or humanitarian grounds.

The Iran nuclear deal, which had imposed restrictions on Iran’s nuclear program in return for easing economic sanctions, had “failed to guarantee the safety of the American people,” the letter said, according to the cited US and Western officials.

The first wave of US sanctions against Iran is to enter into force by an August deadline, and then another wave will hit in November.

The administration planned to maintain sanctions on Iran until the United States sees a “tangible, demonstrable and sustained shift in the policies we have enumerated,” the Pompeo – Mnuchin letter said.

“We will seek to provide unprecedented financial pressure on the Iranian regime,” it added.

“[The United States is] not in a position to make exceptions to this policy except in very specific circumstances where it clearly benefits our national security,” it elaborated.

In 2017, the EU exported to Iran goods and services worth a total of EUR 10.8 billion, and imported from Iran goods and services worth EUR 10.1 billion.

A number of the largest European companies started doing business with Iran after the Iranian nuclear deal was struck more than 2.5 years ago.

Most of them, however, are now expected to withdraw from the country under the threat of seeing their US operations affected by the reinstating of the sanctions by the Trump administration.

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