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5 Feb, 2019 14:11

Iran says it will never accept ‘humiliating conditions’ of EU’s new trade mechanism

Iran says it will never accept ‘humiliating conditions’ of EU’s new trade mechanism

The new payment system set up by France, Germany, and the UK last week to allow “legitimate trade” with Iran, has limited capacity and humiliating conditions, according to Iran’s judiciary chief, Ayatollah Sadeq Amoli Larijani.

The country will never accept that, he said while addressing a meeting with high-ranking judicial officials in Tehran.

“After nine months of procrastination and negotiation, Europeans have created a mechanism with limited capacity, not for exchanging money but for food and medicine,” Larijani was quoted as saying by Tasnim News Agency.

According to him, European countries have set two “strange conditions” for the mechanism named the Instrument in Support of Trade Exchanges (INSTEX).

Also on rt.com European firms ‘won’t dare’ use new EU payment system for trade with Iran out of fear of US

The first condition is that Iran should join the Financial Action Task Force (FATF) and the other is that the country should enter negotiations on its missile program.

“The countries should be aware that Iran will by no means accept these humiliating conditions and will not accede to any demand at the expense of opening a small waterway such as INSTEX,” the judiciary chief said.

The new payment channel for “humanitarian” trade with Iran was launched by France, Germany, and the UK in the wake of US sanctions. They said the system will initially focus on “the sectors most essential to the Iranian population”– such as food, pharmaceutical and medical devices.

They also hailed the future mechanism as an important step in preserving the Joint Comprehensive Plan of Action (JCPOA), saying it would help the European states to stay committed to their part of the treaty.

Some experts, however, said the mechanism was useless and won’t change anything for European companies as they cannot feel confident that they could do business with Iran without being subject to US sanctions.

The EU countries have been considering the idea of a special payment channel with Iran since last year, after the US’ dramatic withdrawal from the landmark nuclear deal, signed by Tehran and six world powers in 2015. Washington then reintroduced its sanctions against Iran.

Last month, the Swiss ambassador to Tehran said Switzerland and Iran were working on an independent payment channel.

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