US enforces sanctions on Swiss-based Iranian subsidiary

State Department acknowledges sanctions will have little direct effect on company, but that it would discourage others from doing business with it.

By ASSOCIATED PRESS, HILARY LEILA KRIEGER
September 30, 2010 22:13
1 minute read.
The members of the U.N. Security Council vote on s

Iran sanctions 311. (photo credit: Associated Press)

 
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The United States on Thursday slapped sanctions on a Swiss-based Iranian company involved in Iran's oil and gas sector and claimed success in persuading several European energy firms to divest from the country.

The move comes as Washington steps up pressure on Iran to prove its nuclear program is peaceful and comes a day after it broadened its efforts to push reform in the Islamic republic by imposing financial and travel sanctions on eight senior Iranian officials accused of serious human rights abuses after last year's disputed presidential elections.

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In the latest step, the State Department placed the Naftiran Intertrade Company, a subsidiary of Iran's national oil company, on a financial blacklist. At the same time, it spared four large European multinationals — Total of France, Statoil of Norway, ENI of Italy and Royal Dutch Shell of Britain and the Netherlands — from the penalties because of their pledges to stop investing in Iran's energy sector.

In announcing the sanctions against Naftiran, the department acknowledged that the penalties — which bar it from doing business with or in the United States — would have little immediate impact as the firm has no commercial activity in the United States. But, it said the sanctions would deter foreign companies from doing business with it.

This "will raise the cost of Iran's refusal to meet its international obligations," Deputy Secretary of State James Steinberg told reporters, calling the measures "a significant setback to Iran."

The US congressman who authored sanctions legislation against Iran warned last week that the measure has only months to show it is effective in preventing Teheran pursuit of nuclear proliferation.

“We’re talking months, not years,” said Howard Berman (D-California), chairman of the US House Foreign Affairs Committee. “It’s in a matter of months... that we have to start seeing this working before people lose faith in this.”

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