Baku, Azerbaijan, Feb. 20
By Elnur Baghishov – Trend:
The INSTEX financial mechanism is not meant for negating and avoiding the US sanctions, Michael Klor-Berchtold, German Ambassador to Iran, told Tasnim News Agency, Trend reports.
According to the German diplomat, INSTEX was created to simplify trade relations between Iran and the EU.
"INSTEX is not against any country. Only legitimate purchases and sales are possible via INSTEX," he said.
Berchtold added that the EU believes that this mechanism will help companies whose trade programs have so far seen no progress.
"During the first stage, INSTEX aims to export medicines, medical products, food and agricultural products of the EU, and move onwards to exporting everyday products needed by Iranians during the second stage," he said.
According to Berchtold, this financial mechanism should uphold the international standards on combating money laundering and terrorism financing at all times.
Berchtold added that this issue is unavoidable for the private sector’s trust for INSTEX.
"The fact of the matter is that the contractual partner banks of the European companies Iran intends to cooperate with are committed to FATF's recommendations in the fight against money laundering and the financing of terrorism," he said.
The German ambassador added that the EU is trying to maintain the economic rules of the Joint Comprehensive Plan of Action (JCPOA) this way.
The JCPOA between P5+1 group (including 5 permanent members of the UN Security Council and Germany) and Iran came into force in January 2016. In May 2018, the US announced its withdrawal from the agreement and imposed sanctions on Iran in November.
EU member states which have signed the JCPOA (namely the UK, France and Germany) have set up with Iran a special financial mechanism called INSTEX to back this agreement.
Two of the four FATF bills have been approved in Iran. Two others – namely, Palermo and CFT bills – are awaiting approvals.