Introduction - "German - Iranian Trade"
Ever since Iran’s revolution in 1979, a growing discrepancy between the Islamic Republic and the United Nations (UN) has incurred political developments that stagnated the prospects of business ventures with Iran significantly. As a result, sanctions and embargos set up as restrictive measures by the United States of America, the United Nations and the European Union (EU) act as barriers to access the market ever since 2007 in response to Iran’s nuclear and ballistic programs.
Ultimately, Iranian banks had to be cut off the Society for Worldwide Interbank Financial Telecommunication (SWIFT) network, resulting in limited options for payment transfers into and out of Iran. As such, all Iran related business activities nowadays carry a considerable risk.
These extraordinary circumstances cause a very unique business environment. Being excluded from the internationally most widely spread payment network, transfers are not processed through adequate payment channels any longer. Letters of credit (L/C) or payment guarantees that help establish business activities are despite great demand not accessible. Customs procedures are very bureaucratic and time consuming. A scrupulous adherence to complex regulations is a must and only experts should engage in business with Iran.
Iran is considered to be a very attractive market with great capital reserves and a high potential for business ventures. In order to operate in this complex arrangement of political influences, companies need to inform themselves about the current political developments and the resulting changes in EU regulations.
This report presents a condensed analysis on the legal, applicable, and available payment transfer services that can be used by German businesses. It presents essential information that is required to understand the context in which German-Iranian ventures are undertaken, such as the relevant sanctions, German authorities, Iran’s banks as well as current developments in Iran-UN-U.S. politics.