Iran Sanctions: The Carrot and the Stick
Shearman & Sterling's Barney Reynolds (London-Financial Institutions Advisory & Financial Regulatory), Dan Newcomb (New York-Litigation) and James Campbell (London- Financial Institutions Advisory & Financial Regulatory) have published an article in International Financial Law Review examining how snapback provisions in Iran's nuclear deal create real risk for foreign investors.
The nuclear deal struck between Iran and global powers in July of this year has caught the attention of many businesses looking to enter the Middle East’s second-largest economy, once it is legal to do so. Reynolds, Newcomb and Campbell advise that businesses must carefully weigh the risk of sanctions potentially destroying their investments as it is possible that the sanctions could snapback once lifted. The article explains the process of snapback, the exclusion of a “grandfathering clause,” and how businesses should consider dealing with sanctions snapping back in contracts signed with Iranians.
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