WASHINGTON (CN) – President Obama has issued an Executive Order authorizing the Secretary of the Treasury to impose sanctions under the Iran Sanctions Act against foreign individuals or entities that invest in the Iranian energy sector.
United States firms and individuals are prevented from investing in the Iranian energy sector under an executive order issued by former President Bill Clinton in 1996 after Iran opened its energy sector to foreign investment through a “buy-back” program, which gives investors a return on their capital without granting them any equity.
According to a 2009 report from the Congressional Research Service, up to that point no firm or individual had ever been sanctioned under the act.
President Obama’s order allows the Secretary of the Treasury to prohibit U.S. financial institutions from making loans or providing credits to, or performing foreign exchange transactions for, firms investing in Iran’s energy sector.
In addition, Treasury is authorized to block all assets of such firms or individuals that come into the jurisdiction of the United States.